Equality of Terms – BMC Software v Shaikh

BMC Software v Shaikh – Equality of Terms


The claimant brought a number of claims against the respondent, including breach of the equality clause (ie equal pay); direct sex discrimination, including a claim of constructive discriminatory dismissal based on the protected characteristic of sex; constructive unfair dismissal and constructive wrongful dismissal.


The tribunal upheld the claim of breach of the equality clause because the claimant had a lower basic salary than her two comparators and the respondent had failed to make out a material factor defence.


What is an Equality of Terms claim?


Well, under the Equality Act 2010 there is an implication into every worker’s terms of work giving them a right to equal pay for equal work.


Therefore, Equality of Terms claims are contractual claims for breach of the implied sex equality clause.


A sex equality clause is defined as a provision that for example, if a woman is employed on work of equal value to that of a man but is paid at a lower hourly rate, her contract is treated as modified so that she is entitled to be paid at the higher rate. The same implication exists for paid sick leave.


Further, the Tribunal upheld all of the constructive dismissal claims on the basis that the equality clause was a fundamental breach of contract. This went to the heart of the relationship of trust and confidence between employer and employee.


The Respondent duly appealed, saying that the employment tribunal had mistakenly rejected various aspects of its material factor defence.


At the Appeal Tribunal, HHJ Hand QC deemed that the provisions from the Equal Pay Act 1970 (EPA 1970) and Sex Discrimination Act 1975 (SDA 1975) provided different remedies were available for each aspect of the discrimination.


This was because a claim under SDA1975 expressly provides a power to award compensation for injury to feelings under tort, whereas the EPA1970 does not, making the two statutes mutually-exclusive.


Under section 70 of the Equality Act 2010, where a claim can properly be brought under the equality of terms provisions in relation to a term in an employee’s contract the protection against direct or indirect sex discrimination by her employer is disapplied. This ensures that where the equality of terms provisions do apply, the same set of facts cannot also give rise to a direct or indirect sex discrimination claim, i.e. the action can only be brought as an equality of terms claim.


If you would like to seek some further advice on this matter, please contact a member of the HPC team who will be happy to advise:


T: 0844 800 5932



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