Tyldesley v T M L Plastics Ltd

Factual and Procedural Background

This appeal arises from an equal pay claim brought by the Plaintiff against Company A, her employer. The Plaintiff was appointed as an Inspection Supervisor on 2nd April 1991, having previously worked as a part-time machine operator. Another Inspection Supervisor, a female employee, worked a different shift and was paid the same rate as the Plaintiff. In April 1992, that other supervisor transferred to different duties, and on 1st June 1992, a male employee was appointed to fill the vacancy at a higher salary than the Plaintiff. The Plaintiff claimed unlawful sex discrimination and unequal pay compared to the male comparator for the period from 2nd April 1991.

The Industrial Tribunal rejected the Plaintiff’s claim under the Sex Discrimination Act 1975 and also rejected the employer’s "genuine material factor" defence under the Equal Pay Act 1970. The Tribunal found the Plaintiff was engaged on like work with the male comparator from 1st June 1992 to 26th October 1992 and that her pay terms were less favourable. However, the Tribunal limited the period for equal pay adjustment to the comparator’s appointment date (1st June 1992), not the Plaintiff’s appointment date (2nd April 1991).

The Plaintiff appealed the Tribunal’s decision on the effective date of the equality clause in her contract and entitlement to arrears. The employer cross-appealed, contending the Tribunal erred in rejecting the genuine material factor defence under Section 1(3) of the Equal Pay Act 1970. The Tribunal agreed to hear the cross-appeal first and ultimately allowed it, remitting the case for re-hearing on the proper legal approach.

Legal Issues Presented

1. Whether the Tribunal erred in deciding that the equality clause in the Plaintiff’s contract should take effect from the comparator’s appointment date rather than the Plaintiff’s earlier appointment date.
2. Whether the employer established the "genuine material factor" defence under Section 1(3) of the Equal Pay Act 1970.
3. Whether the Tribunal erred in applying an additional test of "objective justification" beyond the statutory requirements to the genuine material factor defence.

Arguments of the Parties

Appellant's Arguments

• The Plaintiff argued that the equality clause in her contract had retroactive effect from her appointment date (2nd April 1991), entitling her to arrears of pay or damages from that date rather than from 1st June 1992.
• On the genuine material factor defence, the Plaintiff’s counsel submitted that the Tribunal correctly applied the test established in Rainey v Greater Glasgow Health Board, requiring the factor to be "significant and relevant" and "objectively justified."
• The Plaintiff contended that the difference in pay was not due to a genuine material factor; experience of Total Quality Management (TQM) was not causative of the pay difference.

Respondent's Arguments

• The employer contended that the Tribunal erred in requiring objective justification in addition to the statutory test in Section 1(3) of the Equal Pay Act 1970.
• It was argued that the correct legal test requires identifying a material factor, which must not be sex, and satisfying the Tribunal that it is a material difference between the woman’s and man’s cases, without any additional requirement of objective justification unless indirect discrimination is alleged.
• The employer submitted that the Tribunal’s approach imposed an additional legal burden not supported by the statute or relevant case law.

Table of Precedents Cited

Court's Reasoning and Analysis

The Court analysed the statutory provision under Section 1(3) of the Equal Pay Act 1970, which allows an employer to rely on a "genuine material factor" defence to justify pay differences unrelated to sex. The Court identified the key questions as:

1. What variation exists between the woman’s contract and the man’s contract?
2. To what factor is that variation genuinely due?

The employer must identify the factor (which must not be sex), prove it is material, and prove it is a material difference between the woman’s and man’s cases. The Court held that the Tribunal erred by imposing an additional test of "objective justification," requiring the employer to show that the factor corresponded to a real need and was necessary and appropriate.

This additional burden is not found in the statutory language of Section 1(3) and is only applicable in cases of indirect discrimination, where the factor disproportionately affects one sex and must be objectively justified to avoid unlawful discrimination.

Because no allegation or evidence of indirect discrimination was made in this case, the Tribunal’s requirement of objective justification was legally incorrect. The Court emphasised that a genuine material factor defence can succeed even if the explanation is a genuine mistake or perception, provided it is significant and relevant.

The Court supported its reasoning by reference to established case law, including Rainey, Jenkins, Enderby, Calder, Yorkshire Blood Transfusion, and North Yorkshire CC v Ratcliffe, distinguishing cases where objective justification is required from the present case where it is not.

The Court agreed with the employer’s submission that the Tribunal’s approach imposed an unwarranted additional burden and remitted the case for re-hearing applying the correct legal test.

Holding and Implications

The Court ALLOWED the cross-appeal, held that the Tribunal erred in law by requiring objective justification in addition to the statutory test under Section 1(3) of the Equal Pay Act 1970, and ordered that no order be made on the Plaintiff’s appeal.

The case was remitted to the Industrial Tribunal for re-hearing in accordance with the correct legal approach to the genuine material factor defence, which does not require objective justification absent indirect discrimination.

This decision clarifies the proper legal standard for the genuine material factor defence in equal pay claims under UK law, emphasizing that employers need only prove a material factor unrelated to sex, without additional objective justification unless indirect discrimination is alleged.