Abdulla & Ors v Birmingham City Council

Factual and Procedural Background

The Defendant made an application under CPR Rule 11 seeking a declaration that the court has no jurisdiction or should not exercise its jurisdiction in the present equal pay claims, pursuant to Section 2(3) of the Equal Pay Act 1970 ("EPA"). The claims arise from 174 former employees of the Defendant, predominantly women, alleging failure to pay in accordance with contracts varied by an equality clause implied by the EPA. The Claimants assert that their roles were graded under a Job Evaluation Scheme and that they were paid less than male comparators in equivalent roles, contrary to the equality clause provisions of the EPA.

The Defendant contends the claims could more conveniently be disposed of by an Employment Tribunal and seeks strike out of the claims on that basis. The Claimants commenced proceedings in the Court, although their employment terminated more than six months before the claim was issued, which impacts the time limits for presenting complaints to Employment Tribunals. The issue arises as to the construction of Section 2(3) EPA and whether the Court should decline jurisdiction or strike out claims that could be more conveniently dealt with by an Employment Tribunal.

Legal Issues Presented

1. What is the proper construction of Section 2(3) of the Equal Pay Act 1970 regarding the Court’s jurisdiction to strike out claims that could more conveniently be disposed of by an Employment Tribunal?
2. Does the Court have a discretion to strike out such claims, or is there an obligation to do so if convenience favors the Employment Tribunal?
3. How should the Court consider the time limits for presenting complaints to Employment Tribunals in deciding whether to exercise jurisdiction?
4. Does applying Section 2(3) to strike out claims that are out of time at the Employment Tribunal stage offend the principle of equivalence under European Community law?

Arguments of the Parties

Defendant's Arguments

• The term "conveniently" in Section 2(3) EPA requires the Court to consider the nature of the claim, specialist expertise of Employment Tribunals, procedural rules, and the interests of justice and court resources.
• Employment Tribunals have specialist training, detailed procedural rules, and powers (such as appointing independent experts) suited to equal pay claims, making them the more convenient forum.
• Striking out claims that should be brought before Employment Tribunals is appropriate even if it results in claimants being out of time, as time limits are well known and some claimants may have deliberately concealed facts or suffered disability exceptions.
• Section 2(3) was designed to allocate complex equal pay claims to Employment Tribunals, not to allow claimants to "forum shop" for more favorable limitation periods.
• Reference to prior decision in Ashby & Others v. Birmingham City Council supports striking out claims despite time bar at the Employment Tribunal stage.
• The complexity of equal pay claims, including issues relating to comparators and the GMF defence, indicates the Employment Tribunal is the appropriate forum.
• Reliance on the House of Lords decision in Preston v. Wolverhampton Healthcare NHS Trust & Others (No. 2) to support that time limits for Employment Tribunal claims do not breach the principle of equivalence and justify the Defendant's interpretation of Section 2(3).

Claimants' Arguments

• Equal pay claims are contractual in nature and can be brought before Courts as well as Employment Tribunals, as recognized by case law.
• The phrase "disposed of" in Section 2(3) contemplates a determination on the merits, not a dismissal for time bar.
• It is not more convenient for claims to be disposed of by Employment Tribunals if they would be refused jurisdiction due to time limits.
• The Court is capable of handling complex claims and can refer issues to Employment Tribunals if necessary.
• The claims are not complex because they are based on work rated as equivalent, and the GMF defence has been provisionally rejected in related proceedings.
• The balance of hardship favors the Claimants because striking out would leave them without remedy, whereas the Defendant’s burden is manageable.
• Reliance on the principle of equivalence under EC law requires that procedural rules for equal pay claims not be less favorable than comparable domestic claims, which would be breached by the Defendant’s interpretation.
• Subsequent legislation and case law support the dual jurisdiction of Courts and Employment Tribunals and the ability to bring claims before Courts despite time limits applicable to Tribunals.

Table of Precedents Cited

Court's Reasoning and Analysis

The Court undertook a close textual and contextual construction of Section 2(3) of the EPA. It noted that at the time of the EPA's enactment, Industrial Tribunals had no jurisdiction over contractual claims, and equal pay claims were contractual by statutory deeming. Section 2(1) EPA conferred an option to present claims to Employment Tribunals, but did not require claimants to do so, preserving the right to pursue claims in Courts.

The Court observed the short six-month time limit for complaints to Employment Tribunals (Section 2(4)) and the absence of any power for Tribunals to extend this period, indicating that Court proceedings were intended as a viable alternative for claimants.

The Court held that the term "disposed of" in Section 2(3) contemplates a disposal by determination on the merits, not a refusal of jurisdiction due to time bar. It rejected the Defendant’s narrow construction that convenience should be judged abstractly by the claim’s nature, instead requiring consideration of whether the Employment Tribunal could actually determine the claim on its merits.

The Court emphasized that the discretion to strike out claims in Section 2(3) is unfettered and not linked to the time limits applicable to Employment Tribunals. If the Defendant’s interpretation were correct, it would produce arbitrary results, with complex claims subject to a six-month limit and simpler claims subject to a six-year limit, contrary to legislative intent.

The Court rejected the argument that the risk of forum shopping justified the Defendant’s construction, noting the Court’s ample powers to prevent abuse and to refer issues to Employment Tribunals as appropriate.

Regarding the principle of equivalence, the Court found the Defendant’s reliance on Preston not determinative because Preston concerned limitation on Tribunal claims, not Court claims. The Court reasoned that the Defendant’s construction would create an impermissible procedural disadvantage for female claimants compared to comparable contractual claims by male employees, thus offending equivalence.

Finally, even if the Defendant’s construction were correct, the Court would exercise its discretion against striking out claims that have a real prospect of success and are within the six-year limitation period for Court proceedings, especially given the power to refer issues to Employment Tribunals.

Holding and Implications

The Court DISMISSED the Defendant’s application to strike out the claims under Section 2(3) of the EPA.

The direct effect is that the claims may proceed before the Court rather than being struck out on the basis that they could more conveniently be dealt with by an Employment Tribunal, particularly where the Tribunal would be time-barred from hearing them. This decision preserves claimants’ access to Court remedies notwithstanding the short time limits applicable to Employment Tribunal complaints.

No new precedent was established beyond the Court’s interpretation of Section 2(3) EPA and its application to the facts before it.