Part-time worker discrimination: Supreme Court settles long-running dispute

The Supreme Court has now answered that question in Augustine v Data Cars Ltd, bringing much-needed clarity to this area of the law. 

We look at the background to the case, the Supreme Court's decision and the key lessons for employers.

Facts

Mr Augustine worked for Data Cars Ltd on average 34.8 hours a week. The other drivers worked varying hours, but most worked more than 43 hours a week and some exceeded 60 hours. 

All drivers had to pay a ‘circuit fee’, which was a set rate of £148 a week for every driver. This circuit fee allowed the drivers access to the booking system. 

Mr Augustine argued that the fixed circuit fee was less favourable treatment of him as a part-time worker because it had the effect that he paid a higher fee per hour to drive than a comparable full-time driver. Mr Augustine compared himself to a driver who worked on average more than 90 hours a week. 

The law

Regulation 5 of the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 (the “regulations”) gives part-time workers the right not to be treated less favourably than full-time workers in relation to their contractual terms or any other detriment caused by their employer's actions or omissions.

The protection applies ‘only if the treatment is on the ground that the worker is a part-time worker’ and the treatment cannot be objectively justified. 

This does not mean employers must always treat part-time and full-time workers identically. For example, a part-time worker's pay and other benefits can be pro-rated so that it is adjusted proportionally based on their weekly hours compared to a full-time worker. 

The regulations implemented the Part-time Worker Directive 97/81 which stems from the ‘Framework Agreement on part-time work’. Clause 4 (1) of the Framework Agreement states:

“In respect of employment conditions, part-time workers shall not be treated in a less favourable manner than comparable full-time workers solely because they work part-time unless different treatment is justified on objective grounds.”

Unlike the regulations, the Framework Agreement refers to less favourable treatment occurring ‘solely because' a worker works part-time. 

That difference in wording ultimately led to the dispute before the Supreme Court. 

Employment Tribunal

The tribunal found that Mr Augustine had not been treated less favourably than a comparable full-time driver. It concluded that Data Cars Ltd applied the same circuit fee to all drivers and had therefore not treated part-time workers less favourably.  

The tribunal also found that, even if the fee had amounted to less favourable treatment, the claim would still have failed because Mr Augustine's part-time status was not the sole reason for that treatment. It accepted that Data Cars Ltd charged the fee as a means of generating revenue, rather than because Mr Augustine worked fewer hours. The tribunal also accepted that, at the relevant time, Data Cars Ltd may not have had software capable of operating a commission type arrangement instead of a fixed fee. 

The tribunal therefore dismissed the claim, and Mr Augustine appealed. 

EAT and the Court of Appeal 

The EAT disagreed with the tribunal's conclusion that the fixed circuit fee did not amount to less favourable treatment. It held that requiring all drivers to pay the same fixed circuit fee, regardless of the number of hours worked, placed part-time drivers at a disadvantage and therefore amounted to less favourable treatment. 

The EAT then turned to the question of whether a worker must show that their part-time status was the sole cause of the treatment, or whether it is enough that it was an effective cause of the treatment. 

Mr Augustine argued that the words “on the ground that” in regulation 5 of the regulations should be interpreted consistently with other areas of discrimination law, where the protected status or characteristic need only be an effective cause of the less favourable treatment and not the sole cause. 

Data Cars Ltd argued that the regulations should be interpreted in line with the Framework Agreement, which refers to the treatment occurring “solely because” a worker works part-time. 

Both the EAT and the Court of Appeal agreed with Mr Augustine's interpretation. However, they considered themselves bound by the earlier decision of the Inner House of the Court of Session (Scotland's appeal court) in McMenemy v Capita Business Services Ltd, which held that part-time status had to be the sole reason for the less favourable treatment. 

As a result, the issue ultimately reached the Supreme Court, which was asked to provide a definitive ruling on the correct interpretation of the regulations. 

Supreme Court

The Supreme Court found that Mr Augustine had suffered at least some less favourable treatment because of his part-time status. As a part-time driver, he inevitably took home a lower proportion of his earnings than a comparable full-time driver. 

As to whether it had to be the sole reason for the treatment, the Supreme Court concluded that it did not. A part-time worker only needs to show that their part-time status was an effective cause of the less favourable treatment, not the sole cause. 

The Supreme Court found that this interpretation is consistent with both the wording and purpose of regulation 5 of the regulations. Requiring part-time status to be the sole cause of the treatment would depart from the approach normally taken on causation in discrimination cases and could lead to uncertainty and unreasonable outcomes. 

The Supreme Court also referred to the EAT's observations about the realities of part-time work. The EAT recognised that less favourable treatment often arises because of factors linked to part-time status. Requiring part-time status to be the sole reason for the treatment would therefore risk excluding many cases where it was an effective, but not sole, cause.

To illustrate the point, the Supreme Court used a hypothetical example. If an employer denied a benefit to all “women over 6 feet tall”, an affected employee would be treated less favourably because of both her sex and her height. The fact that there were two reasons for the treatment would not prevent a claim for sex discrimination because sex would still be an effective cause of her treatment. The Supreme Court said the same principle should apply to part-time worker discrimination. If an employer denied a benefit to “part-time workers over 6 feet tall”, a worker should still be able to bring a claim because their part-time status was an effective cause of the less favourable treatment, even though another factor also contributed to the outcome. 

The Supreme Court accepted that other reasons for the treatment may still be relevant. For example, they may affect whether the employer can objectively justify the treatment or the amount of compensation awarded. However, the existence of other reasons does not prevent a worker from establishing that their right not to be treated less favourably on the grounds of part-time status has been breached.

The Supreme Court therefore held that the regulations prohibit less favourable treatment where a worker's part-time status is an effective cause of the treatment. It does not need to be the sole cause. 

What does this mean for employers?

Part-time workers may find it easier to bring successful claims following this decision, as they no longer need to show that their part-time status was the sole cause of the less favourable treatment. It is enough that it was an effective cause of the disadvantage they experienced. 

You should take this opportunity to review your contracts, policies and working practices to make sure that part-time workers are not treated less favourably than comparable full-time workers. Where part-time status is an effective cause of the less favourable treatment, there may be a risk of a claim, even if there are other factors present. 

Where differences in treatment exist, consider whether the pro-rata principle applies or whether the difference in treatment can be objectively justified. Taking these steps now may help you identify and address potential risks before they escalate.

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