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You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Department for Environment Food & Rural Affairs v. Robertson & Ors [2003] UKEAT 0273_03_1012 (10 December 2003)
Cite as: UKEAT/0273/03, [2004] ICR 1289, [2003] UKEAT 0273_03_1012

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BAILII case number: [2003] UKEAT 0273_03_1012
Appeal No. UKEAT/0273/03

             At the Tribunal
             On 23 October 2003
             Judgment delivered on 10 December 2003







Transcript of Proceedings



© Copyright 2003



    For the Appellant MR N UNDERHILL QC,
    (one of Her Majesty's Counsel)
    Instructed by:
    The Department for Environment Food and Rural Affairs, Room 225 Nobel House
    Smith Square
    London SW1P 3TR
    For the Respondents MR M FORD
    (of Counsel)
    Instructed by:
    Messrs Thompsons
    Congress House
    Great Russell Street
    London, WC1B 3LW



  1. This has been the hearing of an appeal by the Respondent, the Department for Environment, Food and Rural Affairs ("DEFRA") against the Decision by the Employment Tribunal at London South, on the hearing of a preliminary issue, that the Appellants, Messrs Robertson, Alexander, Hartland, Holder, Windebank and Huish, and their two chosen comparators fell within the terms of the Equal Pay Act 1970 ("the EPA").
  2. Of the six Applicants, all were civil servants. There are 516,000 civil servants, and they are employed in many different Departments of Government, some in Ministries or Departments headed by a Government Minister, some in Agencies. The main issue before the Employment Tribunal and before us was whether a civil servant in one Department can compare himself or herself with a civil servant in another Department for the purpose of the EPA. All civil servants are technically and legally employed by the Crown, but, as will be seen, the structure which has been established by prerogative act since 1995 is that the terms and conditions of employment are individually negotiated in each Department and Agency. As it was put by Nicholas Underhill QC, Counsel for DEFRA, leading Bruce Carr (who appeared below) and Alan Paine, in their skeleton argument, is there
  3. "any reasons in justice why, say, a beekeeper in DEFRA and a prosecutor in the CPS should be entitled to choose one another as comparators, notwithstanding that it might be possible to prove that their work was of equal value within the terms of s1(2)(c) [of the EPA]"?

  4. All the six Applicants are male. Three of them are Executive Officers ("EOs"), namely Messrs Robertson, Hartland and Windebank. For reasons which will appear, they have played no part in this appeal. Three are Administrative Officers (AOs), namely Messrs Alexander, Holder and Huish. It is the position of the latter which has featured before us. All the Applicants have been represented before us by Michael Ford, who also appeared below, leading Sandra Fredman. As one would expect the presentation on both sides has been of the highest standard, and we have been greatly assisted by it.
  5. The AOs and EOs were, at the commencement of proceedings, employed in DEFRA, which is why it has been made the Respondent. The female comparators upon whom they seek to rely were both, for most of the material period, employed in the Department of Transport and the Regions (Central) (the "DETR(C)") as Senior Personal Secretaries ("SPS"), Mrs Sterno so far as Mr Huish is concerned and Mrs Cooper in relation to the other two AOs.
  6. The subsections of the EPA that have been in issue before us are as follows. We shall recite them with the references to men and women transposed (as is required by s.1(13) of the Act), as in this case it is a case of men claiming parity with women:
  7. "1(1) If the terms of a contract under which a man is employed at an establishment in Great Britain do not include (directly or by reference to a collective agreement or otherwise) an equality clause they shall be deemed to include one.
    1(2) An equality clause is a provision which relates to terms (whether concerned with pay or not) of a contract under which a man is employed (the "man's contract"), and has the effect that –
    (b) where the man is employed on work rated as equivalent with that of a woman in the same employment –
    (i) if (apart from the equality clause) any term of the man's contract determined by the rating of the work is or becomes less favourable to the man than a term of a similar kind in the contract under which that woman is employed, that term of the man's contract shall be treated as so modified as not to be less favourable, and
    (ii) if (apart from the equality clause) at any time the man's contract does not include a term corresponding to a term benefiting that woman included in the contract under which she is employed and determined by the rating of the work, the man's contract shall be treated as including such a term.
    1(5) A man is to be regarded as employed on work rated as equivalent with that of any woman if, but only if, his job and their job have been given an equal value, in terms of the demand made on a worker under various headings (for instance effort, skill, decision), on a study undertaken with a view to evaluating in those terms the jobs to be done by all or any of the employees in an undertaking or group of undertakings, or would have been given an equal value but for the evaluation being made on a system setting different values for men and women on the same demand under any heading.
    1(6) Subject to the following subsections, for purposes of this section –
    (a) "employed" means employed under a contract of service or of apprenticeship or a contract personally to execute any work or labour, and related expressions shall be construed accordingly;
    (c) two employers are to be treated as associated if one is a company of which the other (directly or indirectly) has control or if both are companies of which a third person (directly or indirectly) has control,
    and women shall be treated as in the same employment with a man if they are women employed by his employer … at the same establishment or at establishments in Great Britain which include that one and at which common terms and conditions of employment are observed either generally or for employees of the relevant classes."

  8. The EPA is the way in which the Government complies with its obligations under the Treaty of Rome, under what was Article 119 and is now Article 141, which at subparagraph 1 simply reads:
  9. "Each Member State shall ensure that the principle of equal pay for male and female workers for equal work or work of equal value is applied."

  10. It was established by the case of Defrenne v Sabena [1976] ICR 547 that this Article has direct effect. It can thus be relied upon in addition to the provisions of EPA, and so as to supplement or fill any lacuna in it. Indeed it has, as Mummery P described it in Scullard v Knowles [1996] ICR 399 at 405 "paramount effect". It is in very short and general terms, and it has been necessary for it to be authoritatively interpreted by a number of decisions in the European Court, to which we have been referred. They include, apart from Defrenne itself, McCarthys v Smith [1980] ICR 672, Enderby v Frenchay Health Authority [1994] ICR 112 and, most relevantly to our considerations, Lawrence v Regent Office Care [2003] ICR 1092, to which we shall refer specifically below.
  11. The reasoning of the Employment Tribunal for splitting its hearing into two parts, by way of the hearing of preliminary issues, is persuasively set out in paragraph 1 of its Decision, namely for the purpose of rendering it unnecessary for the Respondent to call evidence at the first hearing to establish a genuine material difference or factor (which evidence was said to be likely to be extensive), if it was established that the comparison sought to be made by the Applicants was not:
  12. "permissible as within the same employment (Equal Pay Act 1970) or establishment or service (Article 141 of the Treaty".

    In fact four separate issues can be spelt out, of which only two have been argued before us. They are:

    (i) Can civil servants employed in one Department compare themselves with civil servants employed in another Department? This central issue is raised by Mr Huish's assertion that he can be compared with Mrs Sterno, although at the date of the Originating Application on 14 August 2001 he was employed in DEFRA and Mrs Sterno in DETR(C). This is the "same employment or service" issue [Issue 1].
    (ii) If such comparison be permitted, was the work done by Mr Huish and his comparator Mrs Sterno rated equivalent within the meaning of subsection 1(2)(b) and (5) of EPA? The point was, it is accepted by both parties, overlooked by the Employment Tribunal, and has not been dealt with: and if the Applicants are successful on Issue 1, it is agreed by both sides that this issue must be remitted back to the Employment Tribunal for consideration.
    (iii) Was the work done by the other two AOs, Messrs Alexander and Holder, and by their comparator Mrs Cooper, rated equivalent in 1998 within the meaning of the above subsections? This is the "1998 job evaluation issue" [Issue 2].
    (iv) Are the EO Applicants (Messrs Robertson, Holder and Windebank) entitled to claim under EPA in respect of any period save October 8-12 2001? This was not addressed by the Employment Tribunal, by reason of the way that the issues emerged before it, and it is again common ground that this must be remitted to the Employment Tribunal, if it remains live. This is the reason why the EO Applicants have played no part in the appeal.

  13. The Employment Tribunal summarised the agreed facts in paragraphs 4-14 of its Decision, and we shall for simplicity repeat material parts of that summary:
  14. "8. Before 1991 negotiations in respect of pay (and other terms and conditions of employment) for the entire Civil Service were conducted centrally. A very lengthy pay scale was applied as a result. … In 1991 the Chancellor of the Exchequer announced that responsibility for pay bargaining could be delegated to individual departments. The statutory authority for such delegation was confirmed by the Civil Service (Management Functions) Act 1992. Central bargaining had proceeded on the basis of an incremental system depending on length of service. This was abolished in respect of all bargaining, whether delegated or not, from 1992 and it was replaced by performance related pay, determined by reference to annual appraisals. Such appraisals normally grade staff on a range between 1 and 4 in descending order. We have seen at least one subsequent delegated agreement which granted the same percentage increase to all staff except those graded 4, but we accept that generally different pay increases are awarded to each different grade. There is no delegation in respect of Senior Civil Servants.
    9. Delegation commenced in those large executive agencies with more than 2000 staff. That was extended to agencies with more than 500 staff. In 1994 it was announced that it was intended to delegate bargaining on pay and conditions to individual government departments. This was confirmed in 1995 and all central, treasury administered, bargaining ceased at the end of that year. From 1 April 1996 the function of establishing terms and conditions of employment was delegated to Ministers and, in turn, to Permanent Secretaries and Chief Executives of Agencies. The Civil Service Management Code was substantially revised to take account of these radical changes. ...
    11. Before and after delegation job evaluation exercises were conducted and most departments used a scheme negotiated by the Treasury Trade Unions in 1992 which we shall refer to as JEGS. That scheme specified eight factors for evaluation on a point scoring basis. Those factors are: knowledge and skills; contact and communication; problem solving; decision making; autonomy; management of staff; financial responsibility; and impact. It is of course to be noted that it is in the nature of job evaluation exercises that some factors are likely to be weighted by means of a higher score range than others. It is also to be noted that the awarding of points under each head permits those conducting the differing evaluations in different departments to emphasise attributes of individuals which are more important to the work being evaluated both generally and in respect of the particular department specialisations and requirements. There was an evaluation in the Department of the Environment in 1995 and in the Department of Transport in 1996.
    12 The process of transfer to new departments meant that groups of staff who had been subjected to different job evaluation exercises … were brought together and this necessitated pay and grading reviews in new and reorganised departments. In September 1998 all MAFF staff below Grade 5 were evaluated using the JEGS system as applied to 1240 benchmark posts. That is about 20% of the total of posts within that department. Included in benchmark selections were a number of SPS and PS posts. The following ranges were attributed to the posts with which we are mostly concerned:
    214 AO posts graded between 220 and 308, producing a confirmed boundary for this grade of 210 to 320.
    163 EO posts graded between 332 and 414, producing a confirmed boundary for this grade of 320 to 420.
    7 SPS posts graded between 234 and 284, producing a confirmed boundary for this post between 320 and 420.
    13 It is to [be] observed that there is clearly a considerable discrepancy between the scores achieved by SPS post holders and the established post boundary. In evidence it was accepted this could not be represented as the result of an analytical evaluation. SPS, work for Senior Civil Servants, mostly in Grade 3.
    14 It was decided that the result of the SPS and PS grading should be the subject of a "follow up operation", and it is a central issue of dispute in this case as to whether that follow up should be regarded as continuation of the same job evaluation exercise or as a new job evaluation exercise. Before the second stage of the evaluation those with personal secretaries were "advised" to "enhance" the work of those secretaries. The obvious intention was to establish higher scores for the post holders so as to bring them within the grade range. It is important to note, however, that the review not only took account the effect of this enhancement but was also motivated by the supposition that the original seven benchmark posts were not typical. The review individually evaluated all 17 SPS posts in the department and scores between 282 and 342 were achieved. Nine posts secured more than the minimum 320 points fixed for the grade. Only two posts scored below the highest score in the 1998 evaluation of this post. The score in each of those two cases was only two points below that highest previous score of 284."

  15. The "legislative history" of the new structure for employment of the Civil Service is as follows:
  16. (i) Ministers of the Crown Act 1975 (the "1975 Act"). Section 1(1)(a) reads as follows:

    "Her Majesty may by Order in Council –
    (a) provide for the transfer to any Minister of the Crown of any functions previously exercisable by another Minister of the Crown.

    (ii) Civil Service (Management Functions) Act 1992 ("CSMFA"), described as an:

    "Act to make provision in respect of functions relating to the management of Her Majesty's Home Civil Service".
    "Delegation of Functions.
    1(1) This section applies to any functions delegated by Her Majesty with respect to the management of Her Majesty's Home Civil Service which has been the subject of a transfer of functions Order.
    (2) A Minister of the Crown in whom a function to which this section applies is vested may, to such extent and subject to such conditions as he thinks fit, delegate the function to any other servant of the Crown.
    (4) Without prejudice to any rule of law with respect to the carrying out of functions under the authority of a person in charge of a government department, where a function is delegated under subsection (2) above otherwise than to such a person, the person to whom the function is delegated may, subject to the terms of the delegation, authorise a servant of the Crown for whom he is responsible to carry out the function on his behalf.
    (5) In this section, "transfer of functions Order" means an Order in Council under section 1 of the Ministers of the Crown (Transfer of Functions) Act 1946 or section 1 of the Ministers of the Crown Act 1975 (transfer of functions from one Minister of the Crown to another.
    Power to authorise exercise of functions without approval etc.
    2(1) This section applies to any statutory power which-
    relates to the appointment or management of members of Her Majesty's Home Civil Service, and
    requires for its exercise the sanction of a Minister of the Crown (whether by way of approval, consent, agreement or otherwise).
    (2) the Minister whose sanction is required for the exercise of a power to which this section applies may, to such extent and subject to such conditions as he thinks fit, authorise its exercise without his sanction."

    (iii) The Transfer of Functions (Treasury and Minister for the Civil Service) Order 1995, which was made pursuant to s.1 of the 1975 Act, and came into force on 1 April 1995: Under the heading "Transfer of certain civil service functions from Treasury to Minister" the following subsections appear:

    "2(1) There are hereby transferred to the Minister the functions of the Treasury with respect to-…
    (d) the remuneration, expenses and allowances of persons employed in the service;
    holidays, hours of work, part-time working and other working arrangements in the service;
    (h) so far as not transferred by the preceding sub-paragraphs, the terms and conditions of service of persons employed in the service."

    The Minister referred to is defined by paragraph 1(2) as the "Minister for the Civil Service", who is in fact the Prime Minister.

    (iv) The Civil Service Order in Council 1995, which came into force on 1 May 1995, and was put before us in a form consolidated from that Order and some subsequent Amendment Orders, which made no material amendment from our point of view. The relevant paragraph, which again, as a result of paragraph 1 of that Order, referred to the Minister for the Civil Service, was:

    "10. The Minister may from time to time make regulations and give instructions
    providing for the number and grading of posts in the Service, the classification of all persons employed therein, their remuneration, expenses, allowances, holidays, hours of work, part-time and other working arrangements, retirement and redundancy, the reinstatement and re-employment of persons in the Service, the re-deployment of staff within the Service and the conditions of service of all persons employed in the Service.
    for controlling the conduct of the Service [including the making and amendment of a Civil Service Code …"

    (v) By a "Delegation/Authorisation under the Civil Service (Management Functions)

    Act 1992" dated 26 March 1996, the Minister for the Civil Service thereby:

    "delegated to Ministers … (b) to determine in respect of home civil servants in their respective departments the number and grading of posts outside the Senior Civil Service and the terms and conditions of employment in so far as they relate to the following:
    (ii) remuneration and allowances, with the exception of the Senior Civil Service … (v) holidays, hours of work and attendance." It continues: "2. This delegation is made subject to the condition that the delegate will comply with the provisions of the Civil Service Management Code as amended from time to time."

    (vi) The Civil Service Management Code ("the Code"), there referred to, has been put before us. In material part it reads as follows:

    This Code is issued under the authority of the Civil Service Order in Council 1995 … under which the Minister for the Civil Service has the power to make regulations and give instructions for the management of the Home Civil Service, including the power to prescribe the conditions of service of civil servants.
    This Code, on which the recognised trade unions have been consulted, sets out regulations and instructions to departments and agencies regarding the terms and conditions of service of civil servants and the delegations which have been made by the Minister for the Civil Service under the Civil Service (Management Functions) Act 1992 to Ministers and office holders in charge of departments, … together with conditions attaching to those delegations. … Where departments and agencies are given discretion to determine terms and conditions, the Code sets out the rules and principles which must be adhered to in the exercise of those discretions. It does not of itself set out terms and conditions of service. In the case of agencies, the presumption is that functions delegated to Ministers and office holders will (in respect of agencies), be exercised by Agency Chief Executives, but the precise extent to which Ministers and office holders may wish to allow the exercise of their powers by Chief Executives is a matter for them to determine.
    This delegation (which revokes all previous delegations) is made subject to the condition that recipients of delegation comply with the provisions of this Code as amended from time to time. However, it does not remove the obligation on departments and agencies to submit to the Cabinet Office proposals or arrangements which are contentious, or raise questions of propriety. Departments and agencies are reminded that the Government is committed to maintaining the reputation of the Civil Service as a good employer. The terms and conditions of civil servants must be determined with regard to: the general practice of large employers; value for money; and the provisions of "Government Accounting".
    6. When exercising the delegated powers permitted by this Code, departments and agencies should remember that existing rights cannot be altered arbitrarily. They must observe any legal constraints upon them as employers, consulting as necessary with their staff and the recognised trade unions. Any questions of possible detriment occasioned by the application of their delegated powers should be resolved locally. If uncertainty over entitlement is an issue, managers should consult their legal advisers and, if necessary, the Cabinet Office."

    Section 7 of the Code includes the following:

    7.1 Remuneration of Staff
    7.1.1 Departments and agencies have authority to determine the terms and conditions relating to the remuneration (excluding pensions) of their own staff outside the Senior Civil Service and the payment of allowances to all staff, subject to the following conditions.
    7.1.2 Department and agencies must develop arrangements for the remuneration of their staff which are appropriate to their business needs, are consistent with the Government's policies on the Civil Service and public sector pay, and observe public spending controls. … The arrangements for the remuneration of staff must be developed in conjunction with the arrangements for organisational change … and reward systems, and must reflect the following key principles:
    value for money from the pay bill;
    financial control of the pay bill;
    flexibility in pay systems; and
    a close and effective link between pay and performance;
    taking account of the inter-relationship between pay, pension provision, leave, and other terms and conditions.
    A department or agency proposing major changes to its pay and grading arrangements must submit a restructuring business case to the Cabinet Office."

  17. This formed part of a complete change of policy by the Government, which was announced and explained in two White Papers, the first presented in July 1994 called 'The Civil Service Continuity and Change' and the second presented in January 1995 and entitled 'The Civil Service Taking Forward Continuity and Change'. The central passages in the first such White Paper appear at paragraphs 3.23 to 3.27, especially as follows:
  18. "3.26 The Government proposes to extend this policy, so that by April 1996 responsibility for the pay and grading of staff below senior level should be delegated to all departments and the existing national pay arrangements replaced. ….
    Such delegation will be a very important step, assisting departments and agencies to achieve additional efficiencies, to improve delivery of services in accordance with the principles of Citizen's Charter, and to establish pay and grading arrangements which reflect the proper interests of staff. …"

    In the second White Paper, the Government described in paragraph 3.15 this:

    "delegation of responsibility for pay and grading of staff below senior levels
    to all departments",

    to be implemented with effect from 1 April 1996, as:

    "a key component in achieving a substantial improvement in performance".
  19. It can be seen that the Treasury's central role ended in 1995 with the transfer of its functions to the Minster for the Civil Service. Since 1996 each Department and Agency has carried out its own collective bargaining, and arrived at its own terms and conditions, and such terms and conditions of employment in each Department and Agency have inevitably diverged. In her witness statement on behalf of DEFRA, Ms Theresa Pollock of the Cabinet Office described this briefly in paragraphs 37 to 39:
  20. "37. As a result of Delegation, around ninety departments now have responsibility for determining the terms and conditions and pay of their own staff. Each department enters into separate negotiations with the Unions with a view to reaching a Settlement (both in terms of pay and other terms and conditions) that reflects [its] own business needs and the priorities of its staff. Neither the Treasury nor the Cabinet Office is involved in these negotiations and Treasury approval of final settlements is not required … This process has inevitably led to significant variations in the terms and conditions (including pay) that are applicable in different departments.
    38. The variations in salaries paid by different departments, to staff nominally at the same grade, highlight the extent to which terms and conditions diverged as a result of Delegation. Charts attached at Annex I show pay ranges for the current equivalents of the former 'Executive Officer' and 'Administrative Officer' grades in a number of different departments.
    39. These variations in salaries demonstrate the extent to which departments have actively used the discretion afforded by Delegation, to introduce pay systems and negotiate pay Settlements (with the Unions) that best suit their particular business needs."

  21. The Employment Tribunal recorded the following in paragraph 43 of its Decision:
  22. "… The degree of diversification is clear from the evidence before us. With some defined exceptions departments and agencies are free to negotiate and agree upon most terms and conditions of employment. Mr Carr graphically summarised the effect of this change by pointing out that 162 pages of the pre-delegation Civil Service Management Code had been reduced to 7 pages. Evidence had also shown that pay bands and minimum and maximum rates of pay now differ significantly from one department to another. Similarly, some departments establish only minimum and maximum and leave all points in between open to the effect of job performance factors. Other departments continue to provide a series of steps within each band. Specifically, in some departments holiday entitlement is expressed by reference [to] overall continuity of employment, whilst in others entitlement depends on grade of staff. A very considerable number of terms and conditions remain the same from department to department. Mr Carr, however, pointed out that most of this similarity was a matter of choice. This is particularly true of the type of job evaluation exercise to be applied. In [practice] the internally devised JEGS system is generally applied, but there is nothing mandatory about that. In any event it might make little difference to the question of discretion if JEGS was obligatory because it is likely that it could be modified from department to department to exclude, for instance, one or more of the eight elements of assessment it contains. It could certainly be modified by weighting those elements in the light of their importance to the work of a particular department."

    Issue 1

  23. The Employment Tribunal concluded as follows:
  24. (i) that contrary to the contentions of the Applicants, it was not sufficient that all civil servants were employed by the Crown and were to that extent in the same employment. That was plainly so, so far as the EPA is concerned, by reference to the express terms of s.1(6) which we have set out above, and with which condition plainly Mr Huish and Mrs Sterno could not comply. But the Employment Tribunal concluded that within Article 141 also, employment is not sufficient. The central words upon which the Employment Tribunal rested its conclusion are the words of the European Court in Lawrence, particularly at paragraph 18, whereby the pay and conditions of the relevant workers must be "attributed to a single source" and that there must be a "body which is responsible for the inequality and which could restore equal treatment". The Tribunal's conclusion was recorded in paragraph 36 as follows:

    "In our view ... the decision in Lawrence v Regent Office Care Ltd has sufficiently clarified the meaning of the application of Article 141 to "establishment or service" to permit us to say that that test requires existence of a common source of terms and conditions which can be said to be responsible for the terms and conditions which have been applied to employees (and in this sense responsible for the inequality) and capable of rectifying that inequality. We will consider in the next section our conclusion as to whether such a common source exists in respect of the Civil Service."

    The Applicants cross appeal that conclusion ("Issue 1A").

    (ii) that there is such a common source. The Employment Tribunal considered (paragraph 41) that:

    "sufficient emerges from the decision in [Lawrence] for us to say that the test there stated requires it to be shown that both claimant and comparator are within the control of a single legal entity which can be said to be both responsible for the alleged inequality and able to remedy it. We shall refer to this, as have others, as the control test": and (at 42) "In the present case we are required to apply the control test to a situation where there was once a single source of terms and condition in all senses of the word but where there is now, as a result of delegation, a variety of different sets of terms and conditions. Determination of terms and conditions has been delegated, we are told, to around 90 separate units comprising government departments and executive agencies. In the present case we are primarily concerned to establish whether, within the same employment, the element of central control no longer exists. If it does not then comparison between one delegated unit and another is not permissible". It concluded that (paragraph 48) "We are left in no doubt that the Treasury has the power to remedy any inequality that arises in terms and conditions of employment. The more difficult question is whether it can be said to be responsible for that inequality" and finally at paragraph 49:
    "In our view the Treasury, on behalf of the Crown, retains, and probably necessarily retains, ultimate total control. It has specifically retained, and continues to exercise, indicators of this control. A number of the indicators of this control operate, over and above any argument of central funding which we do not consider relevant to this decision. If we are right in our view of the nature of the control test we have no doubt that the Treasury gathers together all departments and agencies by its element of control into a single establishment or service within the meaning of Article 141. We have not mentioned, thus far, the placing on any emphasis on the word "service". We did note in our discussion of this decision the fact that different departments provide different particular services. That consideration does not get us far since, upon another interpretation of the word they all provide the service of government. In our view, however, the word service is not to be interpreted in its ordinary dictionary meaning. It had become, in the hands of the ECJ, part of a term of art which, as we have said, we regard as interpreted by the decision in Lawrence as overall control of the process of producing the equality and the ability to control its rectification."

    DEFRA appeals that determination ("Issue 1B").

  25. So far as concerns Issue 1B, Mr Ford on the Applicants' behalf has not laid great emphasis upon, although he has not abandoned, the conclusions of the Tribunal about the role of the Treasury. His case has been put considerably more broadly, both by reference to arguments which he made below but which did not specifically feature in the Employment Tribunal's Decision and, as we shall see, arguments which he did not run below. If it is not enough (as he primarily contends) that the Civil Servants are in the same employment, then it must be shown that the terms and conditions can be attributed to a single source, and he has submitted as follows:
  26. (i) "Control". Such is the case because the Crown – perhaps through the Treasury as per the Employment Tribunal's conclusion, but more broadly in accordance with Mr Ford's submissions – retains control, notwithstanding its delegation. This is the basis upon which in general terms the Employment Tribunal found in favour of the Applicants. The Employment Tribunal defines what might more properly be called "the single source test" as the "control test", as we have set out in our quotation from paragraph 41 of its Decision above. Mr Underhill QC has understandably criticised that formulation, and Mr Ford has not per se sought to support it, but submitted that the Tribunal was simply using it as shorthand for the single source test. Whether or not such formulation led the Employment Tribunal into error, Mr Ford in any event relies only in part upon the Tribunal's conclusions for the success of his proposition.

    (ii) Revocability. Further or alternatively this is the case because the Crown (or rather the Minister for Civil Service) could take back what it has delegated by a simple act of revocation in the same form as the 26 March 1996 delegation/authorisation itself.

    (iii) Retention of Powers. This is the case because the Crown/the Minister has in fact retained that which it delegated. This is a new argument, not run below, and consequently offending against the important and binding principles of Kumchyk v Derby County Council [1978] ICR 1116: nor did it feature in the Applicants' cross appeal. It emerged and became polished during the course of Mr Ford's oral submissions in response to Mr Underhill QC, and it became apparent to us that, if it was to be run, then an amendment to the Respondent's notice required to be formulated and a decision as to whether the new argument should be permitted. In the event, after taking instructions, Mr Underhill QC concluded that as the issue would at some stage have to be faced, it might as well be addressed in these proceedings and invited us not to take any Kumchyk point against the Applicants, provided that his clients were not prejudiced as a result. Apart from the question of reservation of costs, it became clear that this could only be done by granting an adjournment of the hearing on 27 October over to a further date, during which both parties could research any necessary authorities, and DEFRA could, if so advised, as they have in fact done, obtain a further witness statement from Ms Pollock. The issue is now before us, and it is accepted that Ms Pollock's witness statement can be admitted without cross-examination: and there has now been full argument on the adjourned hearing on 24 November. As will be seen, it revolves around the effect of the delegation, namely whether by the March 1996 Delegation/Authorisation the Minister delegated (subject to a subsequent power to revoke) all his powers, or whether he was simply enabling the delegates to exercise his powers while retaining the concurrent right to exercise them himself.

    Issue 1A

  27. Mr Ford submits that, within Article 141, employment by the same employer is sufficient to entitle comparison. He points to:
  28. (a) the broad statement and purpose of Article 141.
    (b) the European Court's statement at paragraph 13 in its judgment in McCarthys Ltd, which was a case where the comparison was sought to be between an employee and a former employee of the same employer, namely (at 690g):
    "13. Thus the answer to the first question should be that the principle that men and women should receive equal pay for equal work, enshrined in article 119 of the EEC Treaty, is not confined to situations in which men and women are contemporaneously doing equal work for the same employer."
    (c) the fact that in Town Investments Ltd v Department of the Environment [1978] AC 359, a landlord and tenant case, Lord Diplock stated, for the purpose of construing counter-inflationary legislation relating to business tenancies that (at 385e):
    "I think that in exercising the functions of government the civil servants of the Crown are all engaged in carrying on a single business on behalf of the Crown, i.e., Her Majesty's government in the United Kingdom."
    (d) the fact that the existence of separate collective bargaining processes relating to groups within the same employer may (or may not – see Enderby at 162) amount to justification for differences in pay, but would not be a ground for denial of comparability.
    (e) (contrary to the apparent view of the Tribunal in paragraph 30 of its Decision) British Coal Corporation v Smith [1996] ICR 515 does not in fact support the proposition that Article 141 is so limited, but can be explained by the fact that the parties did not seek to argue the point under Article 141 because the applicants in that case chose to rest their case solely on the EPA (see 534c). This argument is simply intended to knock away one of the props, as he saw it, for the Tribunal's conclusion.

  29. Primarily Mr Ford relies upon Lawrence. He refers to paragraphs 17 and 18 of the judgment of the European Court (at 1108g-1109a):
  30. "17. There is, in this connection, nothing in the wording of article 141(I) EC to suggest that the applicability of that provision is limited to situations in which men and women work for the same employer …
    18. However, where, as in the main proceedings here, the differences identified in the pay [and] conditions of workers performing equal work or work of equal value cannot be attributed to a single source, there is no body which is responsible for the inequality and which could restore equal treatment. Such a situation does not come within the scope of article 141(I) EC. The work and the pay of those workers cannot therefore be compared on the basis of that provision."

    He submits that it is clear that the European Court is concluding that comparability does apply where men and women work for the same employer, but that it only applies where they work for different employers if the test in paragraph 18 is established. He refers further to the Advocate General's opinion in Allonby v Accrington & Rossendale College [Case C-256/01] unreported (on reference from the Court of Appeal [2001] ICR 1189) in which Advocate General Geelhoed said as follows:

    "40. In the recent Lawrence (…) judgment the Court noted that there is nothing in the wording of Article 141(I) EC to suggest that the applicability of that provision is limited to situations in which men and women work for the same employer. To that extent a comparison between her and a comparator at the College would thus be possible.
    41. However, the Court also held in that judgment, as I also stated in my Opinion in that case, that where the differences identified in the pay conditions of workers performing equal work or work of equal value cannot be attributed to a single source, there is no body 'which is responsible for the inequality and which could restore equal treatment'. … Such a situation does not come within the scope of Article 141(I) EC."

  31. We are satisfied that the statements of the European Court and of the Advocate General above referred to are not intended to be prescribing, or making fresh statements about, the position where there is common employment, but are addressing, in both those cases, situations in which there is not common employment, and providing for that situation. In our judgment, the Tribunal was right and the submissions of Mr Underhill QC are right that the simple fact of common employment is not sufficient for Article 141, any more than it is sufficient for the purpose of EPA, although of course the test for the latter is derived from the statute itself, whereas the former is governed by the European Court's jurisprudence. It is clear to us that what the European Court is setting out is a justification, a principled basis upon which responsibility for difference and discrimination can be pinned. This basis is that the:
  32. "differences identified in the pay conditions of workers performing equal work or work of equal value [can] be attributed to a single source", that "there is [a] body which is responsible for the inequality and which could restore equal treatment."

    This is almost invariably the case where there is a common employer: the best example of such a single source of such a body is a common employer. But the justification can be found not in the common employment but in the single source, and if there is not such single source, no such body, then common employment is not sufficient, as the Tribunal found. This can be supported from a close consideration of Lawrence. The headnote in the ICR at 1092 reads as follows:

    "School catering and cleaning staff employed by a local authority were, after a process of compulsory competitive tendering, transferred to the employment of the respondent companies, who paid them less than their previous wages. The applicants, female staff so transferred and other employees of the respondents, brought proceedings seeking equality of pay with male comparators still employed by the local authority whose work had been rated of equal value in a job evaluation study. An industrial tribunal held that the applicants could not rely on article 119 of the EC Treaty (subsequently article 141 EC) as giving them the right to bring claims comparing themselves with staff currently employed by a different employer, and the applicants' appeal was dismissed by the Employment Appeal Tribunal. On further appeal by the applicants, the Court of Appeal referred to the Court of Justice the question, inter alia, whether the applicants could rely on article 141(I) EC in the circumstances."

  33. The Advocate General's opinion must then be considered:
  34. "36. … The United Kingdom Government and [the respondent] also do not exclude a comparison with employees working for other employers as such, but take the view that there must be a common source from which the terms of conditions of employment at issue in the specific case can be derived, such as is the position where different employers are required to apply the same collective bargaining agreement in the case of a group of undertakings or authorities under common control, or where those terms and conditions have been laid down by statute or regulation. In such cases "cross-comparisons", in which employees of more than one establishment or undertaking may be involved, are indeed possible".

  35. The reference is not simply to the:
  36. "group of undertakings or authorities under common control"

    but the requirement

    "to apply the same collective bargaining agreement.
    37. … Where the pay terms of different employers cannot be traced to a single source, the United Kingdom Government submits, pay discrimination on grounds of sex cannot be confirmed on the basis of a purely legal analysis …."
    38. The second problem that has been alluded to is that an employer who is accused of pay discrimination on the basis of sex, on the ground he pays his workers a lower rate than that received by comparators working for another employer, is not in a position to explain that difference or to explain why the difference in pay is objectively justified. For that reason also the Commission, [the respondent] and the United Kingdom Government take the view that a difference in remuneration must be traceable to one source alone. …"
    40. … With regard to the 'same service', the United Kingdom notes that the Court of Justice has never defined that concept, although it follows from the wording used by the court in a number of judgments that, at least in the private sector, it has had in mind a single undertaking."

    Certainly one could not describe the different departments of the Civil Service with any ease as a "single undertaking".

    "46. It is not evident from the wording of article 141 EC that the comparison must be confined to one and the same employer. Its case law demonstrates that the court has consistently stood by its requirement that for a finding of direct discrimination there must be a clear difference in pay vis-ΰ-vis male co-workers working in the same 'establishment or service' … or that that difference in pay must have its origin in legislative provisions or provisions of collective labour agreements."

    This of course is what is repeated in paragraph 17 of the European Court's judgment.

    "48. The applicants, the United Kingdom government and the Commission are in agreement that the argument that a comparison with employees outside a specific undertaking can never be made is untenable."

    Note again the reference to a "specific undertaking".

    "49. Three categories are involved. The first comprises cases in which statutory rules apply to the working and pay conditions in more than one undertaking, establishment or service. By way of example, one may think of the salaries of the nursing staff working for a service such as the National Health Service. Secondly there are cases in which several undertakings or establishments are covered by a collective works agreement or regulations governing the terms and conditions of employment. Finally, the third category concerns those cases in which the terms and conditions of employment are laid down centrally for more than one organisation or business within a holding company or conglomerate.
    50. In all of those cases it is possible, going beyond the boundaries of the individual undertaking or service, to compare male with female employees in order to determine whether there is discrimination prohibited by article 141EC.
    51. The feature common to the three categories is that regulation of the terms and conditions of employment actually applied is traceable to one source, whether it be the legislature, the parties to a collective works agreement, or the management of a corporate group.
    52. Advocates General Cosmas and Lenz, and now the United Kingdom Government, were right to stress that as being an essential criterion. Why? Article 141 EC is addressed to those who may be held responsible for the unauthorised differences in terms and conditions of employment. In the cases mentioned, they are the legislature, the parties to a collective works agreement and the management of a corporate group. They may be held accountable in this regard. On the other hand, if differences in pay arise as between undertakings or establishments in which the respective employers are separately responsible for the terms and conditions of employment within their own undertaking or establishment, they cannot possible be held individually accountable for any differences in the terms and conditions of employment between those undertakings."
    The Advocate General's emphasis appears to us to be important, that Article 141 is addressed to "those who may be held responsible for the unauthorised differences in terms and conditions of employment".
    "54. It is clear from the foregoing that the direct effect of article 141 EC extends to employees working for the same legal person or group of legal persons, or for public authorities operating under joint control, as well as cases in which, for purposes of job classification and remuneration, a binding collective agreement or statutory regulation applies. In all those cases the terms and conditions of employment can be traced back to a common source."

    This last sentence is obviously again significant.

  37. Of course it is, as is normal, the much more streamlined judgment of the European Court which binds us. But it appears to us that the European Court is in fact following and adopting the reasoning of the Advocate General, and applying it in more concise terms to the particular problem before it, making it entirely plain that the first matter which distinguished the present case from others was that (paragraph 15)
  38. "the persons whose pay is being compared work for different employers".

    We conclude that Lawrence is not authority for the proposition that common employment is sufficient. It is rather authority for the proposition that what underlines the applicability of Article 141 is that which is ordinarily exemplified by common employment, namely the existence of a common source, the existence of a central responsibility for terms and conditions. If that is absent, then comparability is not available.

  39. As to Mr Ford's submissions, set out in paragraph 16 above, the breadth of Article 141 is subject to the exposition in the cases and its underlying purpose as explained: the passage in McCarthys is nothing more than a starting point, as it was in Lawrence. The dictum in Town Investments, if relevant at all, is overtaken by the events of 1995, which plainly occurred as a result of the deliberate change in policy, as is clear from the White Papers; and the references to Smith and Enderby take the argument no further. Mr Ford suggested that if there were some additional requirement over and above common employment, this would be an encouragement for employers to create a situation in which they could allege that they had no responsibility for terms and conditions in a particular department or branch. Mr Underhill QC has responded that this position is already the case by virtue of s1(6) of EPA, which has not been suggested to offend against Article 141, and further that any sham or artificial situation created by employers could and would be disregarded. We have already referred to paragraphs 36 and 52 of the Advocate General's Opinion in Lawrence. We are satisfied that what is important for the purpose of Article 141 is reality, and that an artifice would be no answer. It is obvious that there will be an evidential burden on an employer to displace the ordinary conclusion that the existence of common employment would fulfil the "single source" test. But we entirely agree with the conclusion of the Employment Tribunal that common employment of itself is not sufficient, and we dismiss the cross-appeal.
  40. Issue 1B


  41. This is the first of the three ways in which the matter was argued, to which we have referred in paragraph 15 above. The Tribunal rested on five matters:
  42. (i) Senior Civil Servants. (Paragraph 17 of the Decision)

    "Senior grades remain subject to such central control."

    At paragraph 44 they state:

    "Senior grades in the Civil Service remain subject to central Treasury salary and terms fixing. Whilst it may be suggested that we are concerned only to [consider] the effect on those staff whose terms and conditions have been delegated it is our view that control of senior grades is bound to have a certain amount of effect on the ceilings available for negotiation in lower grades".

    (ii) The Remit. (Paragraph 17) …

    "each Department [must] submit to the Treasury an annual remit showing how proposed changes in terms and conditions, and particularly in pay are to be funded. The Treasury will scrutinise the remit to ascertain whether it is affordable within administrative costs limits and will not 'trigger other spending concerns'. Each bargaining unit will be expected to justify the level of remit and the proposed remuneration package against the guidelines on reform, pay policy and affordability." At paragraph 44: "It is also true that the Treasury requires submission, before each negotiating round, or a 'remit'. It is said that the Treasury will only exercise a monitoring function in relation to that remit by ascertaining whether it complies with certain general principles. In evidence one example was put before us where it appeared that the Treasury had gone beyond this, but so far as we know that example stands alone. We would be surprised if departments submitted remits to the Treasury without careful consideration of whether they would be accepted. The fact, therefore, that it does appear that the Treasury specifically asks only for satisfaction on general principles is, in our view, by no means conclusive of the fact that that is all the Treasury is interested to ascertain. It seems to us unlikely that the Treasury would fail to question apparently unreasonable distribution of the available finance for the total wage bill across the range of staff. There is no doubt in our mind that it would have power to do so if it wished. The detail required in a remit would not necessarily reveal unreasonable distribution, but it seems to us likely in practice that the remit would be capable of raising suspicions of such inequality if it occurred."

    There was no evidence at all in this regard, and Mr Underhill QC refers to it as pure (and unfounded) speculation. Indeed insofar as there was evidence it was to the contrary, as can be seen from paragraphs 48 and 49 of Ms Pollock's witness statement:

    "48. If the Treasury/Cabinet Office is satisfied with the business case put forward, the pay remit will be submitted to the Chief Secretary for approval. On receipt of approval, departments can then commence formal negotiations with the Unions, with a view to securing a pay settlement. As has already been stated above, neither the Treasury nor Cabinet Office is involved in those subsequent negotiations between departments and the Unions. Departments are required, however, to negotiate their settlements within the broad parameters agreed with the Treasury/Cabinet Office.
    49. It is then up to departments to determine the detail of their pay arrangements. This will include, for example, the number of pay ranges; the progression arrangements for each pay range, including any progression points and target rates; the range minimum and maximum; how performance pay should be applied including the distribution between pay ranges and the sums involved, etc. Although departments should notify the Treasury of the outcome of their negotiations with the Unions, there is no requirement for their final Settlements to be approved by the Treasury."

    (iii) The Code. (Paragraph 17)

    "The Management Code specifically states that bonuses, where payable, should be linked to achievement. [Restructuring] will also be checked by the Treasury to see how it is meeting the criteria for reform and on what time scale, and it will be necessary before a remit is processed for the department to comment on any previously imposed conditions and planned reforms. It was emphasised that this degree of control was concerned with general policy and not with individual assessment. Nevertheless control obviously goes further than simply saying that providing the cost is within spending limits the department may do what it likes." At paragraph 45: "Delegation is also subject to the general principles set out in the Civil Service Management Code to which we have earlier referred. On behalf of the Respondent it was said that these were broad general statements of principle. That argument cuts both ways. The very broadness of the principle indicates the range to which it might be applied. As an example, and possibly in particular, the requirement of a link between pay and performance gives considerable scope to the Treasury to call in for consideration particular settlements."

    (iv) Pensions. (Paragraph 18)

    "Pensions and associated matters are reserved for central control". At paragraph 46: "Pensions and associated issues of disability payment are among the relatively few items which are still directly centrally controlled within the Treasury. This can be presented as an isolated reservation, but it can also be said to have a potentially significant effect on other negotiated terms and conditions. Outside the Civil Service, pension provision may well be an item in wage negotiation. The absence of department ability to include that element is bound to affect the scope of available negotiations."

    (v) Changes to Departments. (Paragraph 19)

    "It is obvious, as we have already pointed out, that the movement of large numbers of staff from one set of terms and conditions to another, occasioned mostly by machinery of government changes makes essential review and revision of terms and conditions at the departmental level in respect both of the supplying and receiving departments."

    It is not quite clear what this means, but it is obviously a reference to the regular changes of nomenclature and/or functions of Departments, which can result in the movement of civil servants from one department to another. Although the Tribunal does not mention it, there is a Cabinet Office Statement of Practice, relating to Staff Transfers In The Public Sector, issued in January 2000, described as containing "Guiding Principles" to which the "Government is committed", which provides in material part as follows:

    In order to meet these guiding principles the Government believes that there must be a clear and consistent policy of the treatment of staff, founded upon the provisions of the Transfer of Undertaking … Regulations ... (TUPE). This Statement of Practice sets out the framework that the Government expects all public sector organisations to work within to achieve this aim …
    Transfers and Reorganisation within the Civil Service
    21. Reorganisations and transfers between central Government departments and agencies (i.e. within the Civil Service) do not involve a change in employer and TUPE therefore cannot apply.
    However terms and conditions of employment do vary between different departments and many of the considerations addressed in the Statements for other types of transfer may also apply.
    22. As a matter of policy, therefore, such reorganisations and transfers between central Government departments will be conducted on the basis that –
    (a) as a general rule, when functions are transferred from one department to another staff will be transferred with the work; …
    (b) departments should ensure that wherever possible the principles of TUPE are followed. The existing terms and conditions of staff cannot be changed unilaterally; …
    (c) over time, the receiving department may aim to move, through negotiation with staff, toward fuller alignment of the terms of transfer of staff to those of the main body of staff."

    At paragraph 47 of the Decision the Tribunal states:

    "Finally, the government demonstrates that it is the government not least by relatively frequent 'machinery of government' changes. As we have seen in this case, large blocks of staff are moved and merged with staff who have been working under different terms and conditions. Subsequently the terms and conditions of one or more such groups will have to be assimilated with other groups. The fact of such centrally inspired movement does not directly affect the fact of delegation to the department which has to make the assimilation. Nevertheless it seems to us that the need to make that assimilation significantly and adversely affects the extent of that delegation."

  43. Mr Ford adds the following to this:
  44. (i) He places greater emphasis on the fact that the Delegation/Authorisation was made expressly on the basis that the delegate would comply with the provisions of the Code as amended from time to time. This he submitted, together with the fact that the Code could be so amended, emphasised the retention of control and trammelled the powers of the delegates.
    (ii) He points to two particular pieces of evidence from which an inference could be drawn of continuing control:
    (a) a Mr Nash of the DETR(C) explained how in some years he was asked by the Treasury to clarify the remit, and for the 2001 settlement he was called to a meeting with the Treasury to justify the spending;
    (b) a Mr Lewtas, Senior National Officer of the Union PCS, said that on one occasion the Treasury asked to see an offer letter containing the actual pay settlement before it was sent to the Unions.

  45. We are satisfied that the conclusions of the Employment Tribunal, even as amplified by Mr Ford, do not begin to support a case that the terms and conditions of all civil servants can be "attributed to a single source" or that there is any:
  46. "body which is responsible for … inequality and which could restore equal treatment."

    There are a number of errors in the Tribunal's conclusions:

    (i) It is in our opinion not helpful to define, as the Tribunal does in paragraph 41, the "single source" test as the "control test", because that inevitably leads the Tribunal to concentrate on the wrong question, namely, as it is put in paragraph 42, whether:
    "the element of central control no longer exists".
    In that paragraph the Tribunal itself recognises that
    "there was once [our underlining] a single source of terms and conditions in all senses of the word, but … there is now, as a result of delegation, a variety of different sets of terms and conditions",
    and it thereafter sets out to see whether there is still "an element of central control". Of course the Treasury does have some control, in the sense of overall budgetary control, but that does not mean that the Treasury can possibly be described as the:
    "single source or the body which is responsible for the inequality and which could restore equal treatment:"
    not least when the Tribunal has (correctly in our view) started from the premise that there is no longer a "single source"
    (ii) This leads on in paragraphs 44, 48 and above all 49 of the Decision to the Tribunal laying all its emphasis on the existence of some control in the Treasury. Quite apart from the fact that there is what Mr Underhill QC has referred to as speculation in these paragraphs, the very evidence to which the Tribunal refers underlines the absence of any evidence at all that the Treasury can be said to be the single source of the terms and conditions. The Tribunal refers, in paragraph 44, to the assertion that the Treasury will only exercise a monitoring function in relation to the remit by ascertaining whether it "complies with certain general principles" (with a reference to the one example – presumably the occasion referred to by Mr Lewtas – when it appeared that the Treasury had gone beyond this "but so far as we know that example stands alone"). The Tribunal therefore accepts that:
    "it does appear that the Treasury specifically asks only for satisfaction on general principles"
    but this, the Tribunal suggests, is:
    "by no means conclusive of the fact that that is all the Treasury is interested to ascertain".
    We do not understand how, given that no details of the breakdowns are given to the Treasury, the Tribunal can come to the conclusion that it:
    "seems to us unlikely that the Treasury would fail to question apparently unreasonable distribution of the available finance for the total wage bill across the range of staff … there is no doubt in our mind that it would have power to do so if it wished ... the detail required in a remit would not necessarily reveal unreasonable distribution but it seems to us likely in practice that the remit would be capable of raising suspicions of such inequality if it occurred."
    None of this, nor the passages in paragraph 48 that we have quoted above, begin to explain how the Tribunal can reach the conclusion in paragraph 49 that the Treasury "retains ultimate total control". Certainly none of it suggests that the Treasury is the "single source" of the terms and conditions. And in any event, albeit that the Treasury is responsible for the budget, and receives the remit, it lost any position in relation to terms and conditions of employment upon the transfer of its functions to the Minister for the Civil Service in 1995, a matter which the Tribunal appears to have overlooked.
    (iii) Insofar as the Tribunal used as part of its conclusory process in paragraph 48 of the Decision a view that:
    "United Kingdom legislation has considered it appropriate to assign responsibility in the sense of comparability to the holding company"
    this statement is difficult to understand, and is certainly inconsistent with s1(6) of EPA.

  47. So far as concerns the Employment Tribunal's five factors, we do not consider it relevant to note [(i)] that senior grades in the Civil Service are still dealt with centrally, because that would simply emphasise the reverse position in relation to the civil servants in question in these proceedings: nor do we find it persuasive [(iv)] that pensions are the one aspect of terms and conditions, otherwise not dealt with centrally, which remain so dealt with. The fact that [(v)] on a reshuffle of functions between Ministries, there may be transfer of civil servants between departments but on the basis that, by analogy with TUPE, they retain their previous department's terms and conditions, again seems in our judgment to emphasise the diversity and divergence of such terms and conditions, and the independence of each department's position, rather than the reverse: and as Mr Underhill QC has pointed out, it was done by guidance and expectation rather than by directive – it was not even incorporated by amendment of the Code as a term of the delegation.
  48. The question of the submission of the remit to the Treasury [(ii)] must be taken together with the point made by the Tribunal, and expanded by Mr Ford, by reference to the fact [(iii)] that the delegation was made expressly subject to the Code, to which we have referred and from which we have quoted. The "key principles" contained in the Code which must be complied with by the individual departments are very general. The most specific is encouragement of performance related pay, by reference to key principle (d). They certainly trammel the absolute freedom of the department's power to settle, or to negotiate with the unions, the terms and conditions of their staff, by laying down general guidance. They do not however impact on the individual figures, and in particular they do not impact on questions of comparability between men and women.
  49. With regard to the specific matters raised by Mr Ford:
  50. (i) The very rarity of the occasions when a query of the kind evidenced in respect of Messrs Nash and Lewtas referred to in paragraph 23 above arises can be said to emphasise that it is the "exception which proves the rule". In particular we found it significant that the 'Remit Pro Formas', which we were shown, are, as one would expect, based on total figures, and do not record at all any details of payments to individuals, so that they could give no opportunity for the Treasury to have any input in that regard.
    (ii) The budgetary restraints and guidance exerted by the Treasury are not surprising, and do not begin to argue for the Treasury being the source of the terms and conditions.
    (iii) The Code is to facilitate such restraints and guidance. The fact that the Delegation is subject not only to the existing Code but to any amendments does not, in our judgment, affect the position. We accept Mr Underhill QC's submissions that the incorporation into the Delegation of a provision for amendments to the Code should be read and construed as authorising the incorporation of future similar general guidelines, and not the reinstitution of central control, which would be wholly inimical to the delegated scheme – and would constitute a reversal of the policy described in two White Papers.
    (iv) We are fortified by the existence in the 26 March 1996 Delegation/Authorisation of paragraph 3:
    "3. Where the sanction of the Minister for the Civil Service is required for the exercise of a statutory power which relates to the management of home civil servants, I hereby, on behalf of the Minister, authorise its exercise without his specific sanction to the extent specified in paragraph 1 and subject to the condition in paragraph 2."
    This is plainly an operation of the Minister's power under s2 of the CSMFA, set out in paragraph 10(ii) above, and it emphasises the more that the Minister has taken all the steps he can to emphasise the independence of the departments and agencies, in respect of the decisions delegated to them.

  51. We conclude that the Tribunal erred in law in concluding that the Treasury had material control over the terms and conditions, or that such was an answer to the "single source" test. In the light of the evidence that was before the Tribunal, and upon the basis of the present legal structure described above, it is quite clear to us that no other answer can be given but that it is the individual departments, which fix the terms and conditions, which are responsible for any inequality and which can restore equal treatment, and that in the present state of diversity of terms and conditions there is no single source, certainly not the Treasury, and not the Minister for the Civil Service, to which the
  52. " differences identified in the pay or conditions of workers performing equal work or work of equal value can be attributed."


  53. The second question can be put very shortly. In our judgment, the fact that the present situation could be changed, that the delegation could be simply revoked, is of no significance if it has not been. A new situation would then arise, which has not arisen. This is not a sham (as it might be for example if a company sought to argue that it had divested itself of the power to control the terms and conditions of its workers), but a recognition of reality. The same would apply if, contrary to our conclusions, there could be amendments to the Code which could reinstate central control, although it would appear probable that that would amount to an implied revocation of the delegation.
  54. Retention of Powers.

  55. We turn to the new argument, which seeks not to interpret or analyse the delegation, but to disregard it. The submission by Mr Ford, which we permitted him to run before us, notwithstanding that it had not been argued below, in the circumstances described in paragraph 15(iii) above, was that, notwithstanding the Delegation/Authorisation dated 26 March 1996, the Minister for the Civil Service retained his powers, and thus continued to be the single source or body responsible within paragraph 18 of Lawrence. Mr Ford's submission is not by reference to the particular facts of this case, or the particular delegation, whether by reference to the CSMFA or otherwise, but is based upon what he submits to be the ordinary legal consequence of delegation. He submits that a delegor retains all the powers he (or she – we shall use the former pronoun only) delegates, no doubt unless the contrary is expressly stated, and is thus able, and entitled, to exercise such powers concurrently with his delegate, and without notice. Mr Underhill QC's submission is that the contrary is the case. A delegor delegates all his powers to the delegate, save where there is an express or implied retention of all or any powers. In this case there was no express or implied retention (save of course for the powers which the Minister expressly retained, relating to Senior Civil Servants and pensions etc.).
  56. Both Counsel contend that their arguments are common sense and straightforward, but both have buttressed them by reference to the relatively limited authorities and academic references to which we have been referred. The starting point is Huth v Clarke [1890] 25 QBD 391. In this case there were two judgments, in a two judge Divisional Court. The issue revolved around the Sixth Schedule to the Contagious Diseases (Animals) Act 1878. The relevant clauses were:
  57. "3. A local authority may delegate all or any of their powers, except the power to make a rate, to a committee, with or without conditions or restrictions.
    A local authority may revoke or alter any power given by them to a committee.
    A local authority may, if they think fit, appoint and designate one committee as their executive committee.
    An executive committee shall have all the powers of the local authority, except the power to make a rate, and may, if they think fit, appoint a sub-committee or sub-committees, and delegate to them all or any of the powers of the executive committee, with or without conditions or restrictions, and from time to time revoke or alter any such delegation, and appoint the number of members by whom the powers of a sub-committee may be exercised, and add to or diminish the number of the members of a sub-committee, or otherwise alter the constitution thereof, and fill up or provide for the filling up of vacancies therein, or revoke the appointment thereof and appoint another sub-committee or other sub-committees, and lay down rules for the guidance of a sub-committee, who shall act accordingly."

  58. In Huth the executive committee, to which the powers had been delegated by the local authority, sub-delegated to local sub-committees its powers under the Act. The executive committee then issued regulations itself, which were said to be consequently invalid. Lord Coleridge CJ delivered the first judgment, and it is plain that the basis of his conclusion is that the executive committee was entitled to "resume" its powers. This is of course entirely consistent with Mr Underhill QC's submissions:
  59. "[at 394] It is suggested, however, that, because there was another authority which might (had it chosen) have violated good sense by making an inconsistent order, the executive committee had no power to make the regulation in question. But delegation does not imply a denudation of power and authority; the 6th schedule of the Act provides that the delegation may be revoked or altered and the powers resumed by the executive committee. The word 'delegation' implies that powers are committed to another person or body which are as a rule always subject to resumption by the power delegating, and many examples of this might be given. Unless, therefore, it is controlled by statute, the delegating power can at any time resume its authority.

  60. Wills J however considered that the executive committee had never parted with its powers, supporting the Ford thesis:
  61. "Delegation, as the word is generally used, does not imply a parting with powers by the person who grants the delegation, but points rather to the conferring of an authority to do things which otherwise that person would have to do himself. The best illustration of the use of the word is afforded by the maxim, Delegatus non potest delegare, as to the meaning of which it is significant that it is dealt with in Broom's Legal Maxims under the law of contracts: it is never used by legal writers, so far as I am aware, as implying that the delegating person parts with his power in such a manner as to denude himself of his rights. If it is correct to use the word in the way in which it is used in the maxim, as generally understood, the word 'delegate' means little more than an agent. The notion, therefore, that the use of the word 'delegate' implies that the executive committee parted with their own authority is misconceived."

  62. In Gordon, Dadds & Co v Morris and Others [1945] 2 AER 616, Lynskey J, referred to both the judgments in Huth, and plainly preferred Wills J's formulation (at 621 E-H). However he in any event concluded (at 622A) that:
  63. "the Ministry expressly retain[ed] the authority to decide whether the particular premises should be requisitioned or not. In my view a delegation made in these terms and subject to these conditions did not amount to any denudation of any powers in the Ministry of Health."

  64. Slade J in Manton v Brighton Corporation [1951] 2 KB 393 again recited both judgments in Huth, similarly preferring Wills J's formulation, but concluding that in that case the Corporation had the power to revoke the delegation and had done so.
  65. The Court of Appeal considered the question in Blackpool Corporation v Locker [1948] 1 KB 49. This was a case where the Minister had delegated the power to requisition to the local authority, and the local authority had exercised that power wrongfully: and the Minister then sought to rely upon his subsequent letter dated 20 August 1943 to validate the requisition on a number of bases, including the case that he was entitled to exercise the power of requisition (and to do so lawfully) notwithstanding having delegated the power. Evershed LJ concluded that the 20 August letter did not in any event amount to a requisition, or indeed a ratification of the earlier act by the Authority: his reflections upon Huth were limited (at page 391) to disagreeing with Wills J's proposition that:
  66. "the word 'delegate' means little more than an agent".

  67. Scott LJ in his judgment, with which Asquith LJ agreed, referred to the relevant Regulations (the Defence (General) Regulations 1939), by which the relevant Minister (in this case the Minister of Health) could delegate: such delegation was effected by circulars addressed by him to certain local authorities, or their clerks, including the Blackpool Corporation. The Corporation in effecting the requisition acted in breach of such circulars. Counsel for the Corporation contended (at page 360) as follows:
  68. "… even if the original requisition were invalid as having been made in excess of the powers delegated by the Minister to the local authority, their action was subsequently ratified by the Minister. The position between the Minister and the local authority was that of principal and agent or is a position so analogous thereto as to make the ratification good. The Minister could not transfer his status as a competent authority to the local authority. What he could, and did, do was to delegate to the local authority his function to take possession of land. But a delegation does not divest the Minster of his powers, and, therefore, the Minister himself retained the powers to requisition the land himself or to ratify the requisition by the local authority done in excess of authority. See Huth v Clarke where Lord Coleridge CJ said 'Delegation does 'not imply a denudation of power and authority' and Wills J said 'The word 'delegate' means little more than 'an agent'."

  69. Scott LJ, like Jenkins J, did not accept the agent and ratification argument, but he also rejected the argument based on Huth. He concluded that the circulars were not (page 367):
  70. "mere executive directions but delegated legislation with statutory force, conferring powers on the corporation which they would not otherwise have possessed" and that (at page 369) "I cannot help thinking that much of the legal misconceptions in the minds both of the Ministry of Health and of the corporation about the extent and scope of the powers remaining vested in the Minister, after he had delegated almost all of them to the corporation, was due to the mistaken belief that he was … still retaining a general power of supervision".

    In that context he ruled, after dismissing the agency point, on the retention of powers point at 377 – 8:

    "In any area of local government, where the Minister had by his legislation transferred such powers to the local authority, he, for the time being, divested himself of those powers, and , out of the extremely wide executive powers, which the primary delegated legislation contained in reg.51, para 1 had conferred on him to be exercised at his discretion, retained only those powers, which in his sub-delegated legislation he had expressly or impliedly reserved for himself."

  71. He summarised his rejection of the:
  72. "view of the learned judge that by the letter … of … August 20, the Minister of Health himself requisitioned and thereby came into possession … on the ground: (a) that he had not in his sub-delegated legislation reserved powers so to act"

    [the Huth contention rejected];

    "(b) that neither the corporation or its town clerk was acting as his agent"

    [the agent and ratification point rejected];

    "and (c) that he did not in fact then requisition, or take possession"

    [the point alone relied on by Jenkins J]."

  73. The Locker decision was addressed by the Court of Appeal in Metropolitan Borough and Town Clerk of Lewisham v Roberts [1949] 2KB 608, another requisition case. The issue here was not whether the delegor, once again the Minister of Health, had retained concurrent power with his delegate. The issue was as to the validity of the delegation itself, which was in this case a specific delegation to the town clerk of the Minister's functions under the same Regulations, for the purpose of requisitioning a specific property. The case that was made was that such delegation was not valid, because it was carried out by a letter sent from the Ministry of Health by a general inspector, a Ministry Official, stating that he was directed by the Minister to say that such functions were so delegated. The contention that this delegation was not valid was because it was asserted that the delegation was a legislative act, and that the Minister was required to delegate personally, and could not act by an authorised official of the department. This was rejected by the Court of Appeal, by reference to the principle in Carltona Ltd v Commissioner of Works [1943] 2 AER 560, where a Minister is entitled to act by an authorised official. It was also found to be an administrative not a legislative act. Reliance had been placed on Locker in this regard. Bucknill LJ did not consider that the nature of the act made any difference to the operation of the Carltona principle. Jenkins J said as follows (at 630):
  74. "Reference was made to the case of [Locker], but the court had there to consider the effect of a general delegation to local authorities of the minister's power of requisitioning affected by circulars which laid down what amounted to a code of regulations and restrictions governing the exercise of the delegated powers. I do not think it follows from that case that every delegation of power to requisition, however specific, and in particular even a delegation of power to requisition one particular house, is a legislative act. Still less does it follow that the power of delegation … can only be exercised by the minister himself personally, the mode in which the power should be exercised … being an aspect of the matter with which the case of [Locker] was not, as I understand it, concerned."

    He, consequently, concluded that the sending of a letter in that case was not a legislative act, that Locker could be distinguished, and that in any event the difference between an administrative and legislative act made no difference to the Carltona principle, as had Bucknill LJ. Denning LJ, after dealing with and disposing of, in the same way as his brother judges, the Carltona point, so concluded, and then continued as follows (at 621 to 622):

    "The minister is not bound to give his mind to the matter personally. That is implicit in the modern machinery of government: see [Carltona] …. It is sufficient if one of the officials of that department brings his mind to bear on the propriety of it. When the government department delegates its functions to a town clerk … it is really only putting someone in its place to do the act which it is authorised to do. The town clerk is, so to speak, an agent of the department and a sub-agent of the Crown. [A contention raised by Wills J in Huth which had not found favour with the Court of Appeal in Locker and was in any event not a part of the conclusion of either of the other two judges in Roberts.] The delegation to the town clerk is simply administrative machinery so as to enable the ministry's function of requisitioning to operate smoothly and efficiently; and, like all administrative functions, the act of delegating can be exercised by any authorised official of the government department. The delegation, whether general or specific, is not a legislative act, but an administrative one …; and it does not divest the government department of its powers (see [Huth] ... and [Gordon Dadds]). Having regard to those authorities, I cannot agree with the observations of Scott LJ to the contrary in [Locker]. They were, I think, unnecessary for the decision, which turned on the fact that the town clerk there acted outside his actual authority and his action could not be ratified."

  75. There are no further relevant authorities: neither party sought to say that the only other authority before us, Winder v Cambridgeshire County Council 76 LGR 549 (CA) added anything. We have however considered four learned academic writings:
  76. (i) De Smith, Woolf and Jowell's Principles of Judicial Review (1999). The relevant passage was at 229, which reads:
    "Nevertheless, it has sometimes been stated that delegation implies a denudation of authority
    [there is a footnote reference to Locker, to two academic writings which have not been referred to me and to Winder].
    "This cannot be accepted as an accurate general proposition. On the contrary, the general rule is that an authority which delegates its powers does not divest itself of them – indeed if it purports to abdicate it may be imposing a legally ineffective fetter on its own discretion – and can resume them."
    No authority is cited for the so called "general rule", to the contrary of the Court of Appeal authority in Locker (unless the reference to resumption is considered as reimporting Lord Coleridge CJ).
    (ii) Halsbury's Laws of England (4th Edition 2001 Reissue) Vol (1) [General Editor M Supperstone QC]. At paragraph 31, page 47 there is stated:
    "In general, a delegation of power does not imply a parting with authority
    [apart from a specific statutory provision in the local authority's field, there is only reference to Winder: Locker is referred to in the footnote but it is stated "This view is at variance with basic principles"].
    "The delegating body will retain not only power to revoke the grant, but also power to act concurrently on matters within the area of delegated authority [there is a footnote reference to Huth] except in so far as it may already have become bound by an act of its delegate."
    No authority is stated for the so called "basic principles" to the contrary of the Court of Appeal in Locker.
    (iii) Administrative Law (5th Edition) by Professor Craig. At page 525, he refers to Locker and states:
    "The case has been criticised by writers
    [the only reference is to one article in 1952 68 LQR 363 by R Jackson entitled "County Agricultural Executive Committees", to which I have not been referred]
    "and doubted in the courts"
    [there is no footnote reference here so it is to be assumed that the only reference is to Roberts which follows in the text].
    "In Roberts, Denning LJ on similar facts, stated that the town clerk was an agent of the ministry, that the delegation whether general or specific was not a legislative act and that it did not divest the government of its powers. The Locker case was said to turn on the inability of the Minister to ratify the act of an agent who had exceeded the assigned authority. The opinion of Denning LJ is to be preferred: the relationship resulting from the lawful delegation was analogous to one of principal/agent, with the former possessing power concurrently with the latter. However the essence of what Scott LJ was saying in Locker should not be dismissed so easily. We saw that the ordinary model of the agent acting on behalf of the principal did not fit easily into a delegation or sub-delegation of legislative power, where the delegate or sub-delegate would normally exercise power in his or her own name. By extension of the same reasoning, where the power delegated or sub-delegated is legislative then it makes sense that the delegator should not have concurrent powers."
    (iv) Administrative Law by Sir William Wade (8th Edition). At page 322 there is stated:
    "A statutory power to delegate will normally include a power to revoke the delegation when desired. While the delegation subsists it may be arguable whether the delegating authority is denuded of its power or is able to exercise it concurrently with the delegate."

    There is then reference to the various cases to which we have referred at length in this judgment.

  77. In our judgment, whereas the judges in Huth each put forward a conflicting basis for rejecting the contention that the executive committee's act was invalid, Lord Coleridge CJ supporting the Underhill proposition and Wills J supporting the Ford thesis, and two subsequent puisne judges preferred the Wills J formulation but neither needed it for their conclusion, the Court of Appeal decision in Locker is binding upon us. It appears to us clear, so far as Roberts is concerned, that:
  78. (i) Locker was only indirectly relevant to the issue which the Court of Appeal there had to decide. An entirely different issue was before it, namely based on the Carltona principle, to which the question whether the minister's delegation (through his authorised official) was legislative or administrative was not in the event decisive. But certainly the issue as to whether the Minister by such delegation had denuded himself of his powers did not arise.
    (ii) Neither Bucknill LJ nor Jenkins J in fact doubted Locker even on the question, limited as it was, as to whether the minister's delegation through official circulars could be described as a legislative rather than an administrative act. In any event, as Jenkins J pointed out, delegation of a general power through a circular could be differentiated from delegation of a specific one-off requisition through a letter.
    (iii) Denning LJ was of the view that the exercise of delegation in the Roberts case was administrative not legislative, and was not of the view, as Scott and Asquith LJJ had been in Locker, that delegation even of a general power by circular would be legislative delegation. But:
    (a) The other two judges in Roberts did not agree with him in this regard. Nor does it seem from the report at page 615 that distinguished Counsel for the plaintiffs (Messrs Parker and Pearson) had argued this point, contenting themselves with the submission that in Locker the court had:
    "had to consider the effect of a general delegation to local authorities of the minister's power of requisitioning effected by circulars containing a code of regulations":
    unlike the case in Roberts.
    (b) We are satisfied that it is not right for Denning LJ to say (as referred to by Professor Craig) that Locker "turned on the fact that" the town clerk's action could not be ratified. The fact that the minister had not retained his powers once they had been delegated was plainly also ratio.
    (c) In any event, we are satisfied that the precise nature of the delegation, whether it was in fact administrative or legislative, did not matter for the decision in Locker. What was concluded in Locker, Huth being cited to the court, as we have pointed out in paragraph 38 above, was that delegation did involve denudation.
    (iv) Insofar as Denning LJ went further than disagreeing with the majority in Locker as to the legislative or administrative nature of the delegation, and disagreed with it in relation to Huth, and the conclusion that delegation did "divest the government department of its powers", such disagreement was plainly both obiter (or, adopting his own words against him, "unnecessary to his decision"), the point not being in issue in the case before him, and also a minority view, the other two not expressing any opinions.

    We have seen nothing in the academic authorities to persuade us that Locker is not binding upon us and consequently does not represent the principle which we should adopt.

  79. Irrespective of whether we are, as we conclude, bound by Locker, in any event we prefer the Underhill proposition, namely that, in the case of such a delegation as this, the ordinary consequence is divestment of the delegor of the powers delegated, unless there is an express or implied retention either of some powers or of all powers (whether with or without a provision for notice to the delegate), rather than the Ford thesis of the retention of power being the norm unless something is stated to the contrary:
  80. (i) None of us has seen, nor has there been any reference in any authorities to, a delegation which expressly provides that the delegor is not entitled to perform any of the delegated powers. The absence of such an accepted practice tends to suggest that it does not occur, which casts doubt at least on a fallback position for Mr Ford, and thus would drive him to the stance that all delegations divest. The Underhill proposition has the advantage of the inclusion within it of the availability of express or implied retention of some, or indeed all, of the powers delegated.
    (ii) The nature of the actual dispute between Denning LJ and Scott LJ is somewhat arid, namely whether the delegation is a legislative or administrative one. This aridity is the greater given that (i) the distinction between what is administrative and what is legislative is now the more blurred (see Wade's reference to a "hazy borderline between legislation and administration" at page 839) and (ii) in our case the delegation was by way of a prerogative act, which may be said to be quasi legislative. If it is to be determinative that the delegation was legislative rather than administrative, then it might be thought that this case falls on the legislative side of the line.
    (iii) But Professor Craig, while preferring the opinion of Denning LJ, was of the view that:
    "the essence of what Scott LJ was saying in Locker should not be dismissed so easily".
    This it seems is on the basis of a distinction, not as to whether the delegation is legislative or administrative, but whether the power delegated is legislative. We can see no ground for this distinction. Although it is obviously of greater import if the power is to issue a regulation, and it makes it even less sensible for there to be two concurrent powers to issue such regulations, nevertheless it does not seem to us that there is any real distinction to be made from a delegated power to perform possibly irrevocable and far reaching administrative acts, or indeed delegated prerogative acts.

  81. In any event we are of the view that, in ordinary parlance, delegation does imply denudation and that ordinarily (leaving aside instruction of a non-exclusive estate agent) it will not be regarded as appropriate for a delegor to go off and do himself, without notice to the delegate, what he has just delegated. There are dangers and uncertainties, in our judgment, in such concurrent authority. Mr Ford sought to distinguish a concept of transfer (such as is referred to in the 1975 Act), which he accepts does divest the transferor of powers, from that of delegation which he submits does not. We do not see that distinction. In our judgment a transfer would ordinarily imply an irrevocable horizontal transfer of powers, whereas delegation would imply a vertical transfer, very often, if not normally, accompanied by an express or implied retention of powers, but not so as a matter of course.
  82. Mr Ford made the following submissions, to which Mr Underhill QC responded, and as to which we conclude as follows:
  83. (i) Locker did not overrule Huth. There is no need for an express overruling by the Court of Appeal. In any event the decision in Huth was not challenged, but it was right on the reasoning of both judgments, and it was only the judgment of Wills J and not that of Lord Coleridge CJ which was inconsistent with Locker.
    (ii) The concept of denudation must apply as much to sub-delegation as to delegation, and this renders its applicability unlikely. Mr Underhill QC accepts that it must apply to both, and does not have any concern (Huth involved sub-delegation). We agree with Mr Underhill QC, although we consider that, in the event of a sub-delegation, an express or implied retention of rights by the sub-delegor may be more likely.
    (iii) Mr Ford submits that the Underhill proposition stretches the ultra vires doctrine, but we do not agree with this. Any legislative or administrative act by a delegor who no longer has the powers would be as invalid as such an act by a delegate whose delegation has been revoked.
    (iv) Mr Ford submits that Parliamentary scrutiny would be reduced if a Minister did not retain powers which he delegated. We do not agree. He is still answerable to Parliament, irrespective of the delegation.
    (v) Mr Ford submits that the fact that there is specific power to dissolve a government department under s.1(b) of the 1975 Act indicates that there must be retention of powers to cope with such a situation. This would only occur in the event of an Order in Council being made pursuant to that subsection. In such event, although all such civil servants may be in a moment of limbo, they would speedily transfer to another department (on the analogous TUPE basis). No power over their terms and conditions requires to be reserved for this purpose.

  84. We conclude that the delegation here was of the divesting or denudatory kind and that there is no sign of any implied or express retention of powers, over and above those that were expressly retained, to which we have referred. As we have indicated earlier in this judgment, the fact that the minister's power under s,2 of the CSMFA was operated so as to remove the need for his sanction where it would otherwise have been required, that the delegation was made expressly subject to the Code so that some limited oversight was ensured, that the policy was the subject of White Papers and express statutory creation, and the absence of any continuing role for the Minister of the Civil Service, fortify us in such conclusion.
  85. In any event we are satisfied, whatever the proper resolution of any jurisprudential dispute about the ordinary nature of delegation:
  86. (i) that this delegation did not involve any retention of powers over the pay conditions of the Applicants.
    (ii) that the Minister of the Civil Service has not, since the transfer of powers from the Treasury in 1995, been a single source or body responsible, for the purposes of Article 141.

  87. In those circumstances the third way in which Mr Ford puts his case also failed, and we allow the appeal in respect of Issue 1.
  88. Issue 2

  89. The question here is whether Mrs Cooper's job was rated equivalent to that of the AOs in the September 1998 JEGS job evaluation review of certain jobs in MAFF (the Ministry of Agriculture, Fisheries and Food). This exercise was described in paragraphs 11 and 12 of the Tribunal's Decision, set out in paragraph 9 above. It was a benchmarking exercise, i.e. not all posts were evaluated. Such an exercise was described by Phillips P, giving the judgment of the Employment Appeal Tribunal in Eaton Ltd v Nuttall [1977] ICR 272, to which there was annexed (at 278b) as an Appendix a note on the principal methods of job evaluation. Under "Job Classification" the following explanation was given:
  90. "… the grading structure is established first and individual jobs fitted into it. A broad description of each grade is drawn up and individual jobs considered typical of each grade are selected and 'benchmarked'. The other jobs are then compared with these benchmarks and the general description, and placed in their appropriate grade."

  91. The Tribunal dealt with this as follows:
  92. "38. The Applicant contends that the 1998 and 1999 JEGS exercises in MAFF constituted two separate job evaluation exercises and that, under the first, the AOs in these proceedings (Mr Alexander and Mr Holder) are entitled … subject to possible genuine material factors to comparison with Ms Cooper. The Applicants accept however that if they are right in this contention the second job evaluation exercise in 1999 re–graded Ms Cooper, and from that date the AOs will be unable to seek further comparison with her. …
    39. Mr Carr submits that it is legitimate for a job evaluation process to identify a fault in the benchmarking or other aspect of the analytical process and to rectify that fault, by reassessment if necessary. He also draws attention to evidence before this Tribunal that, as regards Ms Cooper, no changes were made in the contents of her job between its comparison in 1998 with seven benchmark jobs and its individual assessment in 1999. This is consistent with evidence supporting the submissions that at least one reason for the reassessment in 1999 was the feeling that the benchmark [s] chosen in 1998 were not representative of the thirty or so SPS posts in MAFF and that it was this flaw that the 1999 survey revealed …
    50. Our conclusion is that there were, within MAFF, two separate job evaluation exercises, one in 1998 and another in 1999. The 1999 evaluation of SPS posts reflected the enhancement that had taken place in that grade. It is that change in job content which, in our view, separates it from the 1998 review. We do not consider it relevant that any particular post was, or was not, significantly enhanced. The exercise was one of evaluating the grade to which the posts were attached. It follows that Ms Cooper was evaluated in 1998 subject to the benchmarked evaluation exercise [it seems common ground that this should read "Mrs Cooper's job was evaluated in 1998 as part of a benchmark evaluation exercise"] and that her post, as differently constituted, was re-evaluated in 1999. We do not consider that it can be said that the 1998 evaluation had not come to any conclusion upon the evaluation of SPS. They were then evaluated in the same way as all other posts. Upper and lower and average values were declared for them. The so called 'enhancement' of the number of posts within that grade necessarily gave those posts different content and, therefore, gave to the grade, as was intended, an entirely new range of scores."

  93. DEFRA submits that this does not set out any or any sufficient reasoning for the Employment Tribunal's conclusion, so as to offend against the principle in Meek v City of Birmingham District Council [1987] IRLR 250, but in any event that the Tribunal did not apply the correct approach in law by reference to ss1(2)(b) and (5) of EPA and the authorities to which we shall refer; and that insofar as a correct approach was adopted, the conclusion was perverse. Mr Underhill QC 's case is that:
  94. (i) Ms Cooper's post was not included in the 1998 Review. This is common ground: in relation to SPSs, seven posts were evaluated, not including Ms Cooper's.
    (ii) The work in respect of SPSs was not completed, in the sense that no conclusion was reached, so that within s1(5) of EPA, on a study undertaken with a view to evaluating the jobs, the work on the SPSs was incomplete and no final decision reached even in relation to the seven benchmark jobs, not to speak of Ms Cooper's individual job to be derived therefrom, so that it could not be said that Ms Cooper's job was given a value, so that her job and that of the AOs were not given an equal value.

  95. Helpful guidance can be derived from two cases. The first is Eaton, in which Phillips P said as follows at 277e ff
  96. "During the course of the argument upon the appeal we heard several submissions upon the construction of s1(2)(b) and s1(5) of the Act. We think that it might be useful to mention one point upon which we have reached a conclusion, in case it is argued before the Industrial Tribunal that there was in existence here an evaluation study within subsection (5). We were told by [Counsel for the employers], upon the tentative instructions available to him at the time, and it may be that this will not be found to be wholly accurate, that the evaluation study in force at the material time produced a series of salary grades in respect of which there was a minimum, a middle and a maximum point. Those instructing him were under the impression, and this is the matter of doubt, that the point at which a particular employee was placed within the range of his relevant salary grade depended not only upon such factors as merit or seniority but upon such other factors as degree of responsibility, which, as we have already pointed out, are usually included within an evaluation study. It seems to us that subsection (5) can only apply to what may be called a valid evaluation study. By that, we mean a study satisfying the test of being thorough in analysis and capable of impartial application. It should be possible by applying the study to arrive at the position of a particular employee at a particular point in a particular salary grade without taking other matters into account except those connected with the nature of the work. It will be in order to take into account such matters as merit or seniority, etc, but any matters concerning the work (e.g. responsibility) one would expect to find taken care of in the evaluation study. One which does not satisfy that test, and requires the management to make a subjective judgment concerning the nature of the work before the employee can be fitted into the appropriate place in the appropriate salary grade, would seem to us not to be a valid study for the purpose of subsection (5)."

  97. The other authority is that of Bromley v H & J Quick Ltd [1988] ICR 623, also in the Court of Appeal. The relevant passage is in the judgment of Woolf LJ, as he then was, at 638 fff:
  98. "(a) The reason this appeal succeeds is that with the exception of Mrs Bromley and Mrs Owen it was not established that any of the applicants' jobs and any of their respective comparators' … were ever evaluated under various headings as required by s1(5). However subject to this critical defect in my view the employers' study complied with s1(5). If both an applicant's job and her comparator's job had been the same job as any of the 23 benchmark jobs or 73 representative jobs, the study in relation to that applicant's and comparator would have fulfilled the requirements of s1(5). (b) In order to comply with s1(5) it was not necessary for employers to have arranged for every single job performed by their employees to be subject to the same exhaustive process as took place and is described by Dillon LJ in relation to the 73 and 23 jobs. Such a requirement would make a bench-mark study wholly useless and place an immense burden on many employers. The employers can identify a group of jobs which when evaluated under the headings have no material difference. Then one of that group of jobs can be evaluated under headings and slotted into the rank in that appropriate position having taken into account the factor value and that job can then represent the other jobs within the group. It is possible , as the 73 were chosen as typical, that this is what in fact happened in the case of the applicants and their comparators but if it did there was no evidence of this and as the onus is on the employers to satisfy section 1(5) [on the particular facts of this case] the absence of evidence is fatal to their case. (c) If however a system of choosing a representative job for a group of jobs is adopted then in relation to a job, which has not been evaluated under headings, it will be open to an employee to contend that his or her job is materially different from the alleged representative job and if this is the case the study will not comply with section 1(5). (d) Although the appeal provision in this case did not assist the employers, if on the appeals which did take place both the applicant's and the comparator's job had been evaluated under headings, which could be by reference to the bench-mark study, this could, depending on the circumstances on the appeal, have complied with section 1(5). (e) While the requirements of sections 2A(3)(2) and section 1(5) are highly technical it is "without prejudice to the generality" of section 2A(3)(1)(a) and a defective study could still, at least in theory, assist in establishing that there are no reasonable grounds for determining that the work is of equal value.

  99. There was some oral evidence. The only significant passage from the point of view of resolving this issue was in paragraphs 28 to 30 of the evidence of Mr Stephen King, employed in the Conditions and Job Evaluation Team, which is part of the Cabinet Office's Corporate Development Group. They read as follows (and it was common ground that no material difference emerged in oral evidence):
  100. "28. The 1998 JEGS report indicated that the 7 SPS posts, selected as benchmark jobs, did not appear to be doing work that MAFF would normally require of an SPS and that the JEGS scores of the individual benchmark posts varied considerably. In my view, this could have occurred for one or more of the following reasons:
    (a) The design of the post may have changed since they were originally appointed as SPSs;
    (b) The posts may have remained the same, but the business, and the jobs relative value within it, has changed;
    (c) The post holders may not be undertaking the job to the level at which it is designed;
    (d) The posts selected as benchmarks are not typical and more job evaluation evidence is required (this is particularly relevant to secretarial type roles where job content and, therefore, job quality can vary a great deal.
    29. In such a situation, it is common practice for a further wider ranging assessment to be carried out. Such an assessment would look at a larger number of the posts in question so as to provide a more accurate assessment of the average weighting of the post.
    30. This was in fact what MAFF decided to do. A further review of all 17 SPS posts in MAFF's headquarters was carried out in 1998/1999. In this review the same JEGS standards as those in the initial review were applied. The SPS review compared the jobs and resultant JEGS scores to the original benchmark jobs used in the initial review. It is therefore possible to directly compare the JEGS scores of both the initial and subsequent review as this was an extension of the original job evaluation study (see (v) A JEGS 'Single Study')."

  101. Mr Ford refers to the chart showing the results of the 1998 study. This contains all the 23 jobs which were evaluated, and in respect of each one the table recites the original grading, the sample size, and the average score given as a result of the study. Such table records that in relation to the SPSs (of which, as we have said, the sample was 7), their original grade range was 320 to 420, and the average score was only 258: 100% of the scores for the seven samples were below grade, whereas with three exceptions (two of which were minimal) every single other job was scored 100% within grade. Mr Ford submits that this anomalous or surprising result was irrelevant. The fact is that the SPS job was graded, and although Ms Cooper's job was not itself rated, because this was a benchmarking exercise it could have been deduced. The fact that MAFF carried out another review in 1999 does not prevent there having been a concluded review, and a concluded rating of Ms Cooper's post, in 1998.
  102. The central consideration must be given to the actual Report, so far as it relates to the SPS job, at paragraph 4.5.6 of the Review. This reads as follows:
  103. "Senior Personal Secretary; 7 posts were evaluated – the scores ranged from 234 at the lowest to 285 at the highest. The average score for the grade was 258. All posts were assessed as below grade. Some posts were only marginally better than their PS counterparts. Those in Legal Group were better quality, where the SPS, unusually, had staff to manage. SPS posts when assessed against grading guidance should be expected to carry out around 50% equivalent EO duties: this was not evident in the posts evaluated. Further work involving a wider, or possibly 100%, sample will be required."

  104. The consequence of this is clear from MAFF's instructions for a further JEGS exercise in a letter dated 28 October 1999, which reads in material part as follows:
    The background to the exercise is that as part of the 1997 Pay and Grading Review, SPS posts were evaluated along with others using JEGS methodology. The review found that none of the seven posts reviewed were of sufficient job weight for the grade … The current exercise was arranged to review all SPS posts so that decisions could be taken on whatever adjustments were needed to posts, based on up-to-date information rather than relying on information from a couple of years ago."

  106. The 1999 Review itself was indeed limited. It was not a complete fresh review of MAFF posts but was described as a "Review of Senior Personal Secretary Grades Post in MAFF Headquarters".
  107. It is plain that the opportunity was taken after the 1998 Review for some "enhancement" i.e. rethinking of the SPS jobs. But it is equally plain that that was not the only purpose nor the context of the further Review. The further Review plainly took place as a direct consequence of the statement in paragraph 4.5.6, quoted in paragraph 42 above, by the Consultants that:
  108. "further work involving a wider, or possibly 100%, sample will be required."

    It is obvious that the further work was then carried out, by reference to a 100% sample, limited to MAFF Headquarters. The Tribunal itself referred in paragraph 14 of its Decision to the Review being:

    "also motivated by the supposition that the original seven benchmark posts were not typical"

    and at paragraph 39 that

    "at least one reason for the reassessment in 1999 was the feeling that the benchmark[s] chosen in 1998 were not representative".

    It is plain that this was not simply a supposition or a feeling, but a conclusion by the Consultants themselves. The Tribunal found that there were, contrary to the contention of DEFRA, two separate exercises in 1998 and 1999, rather than one continuing one, and that is a finding of fact that is not only not capable of challenge but obviously right. But it is not in any way determinative of the issue. The question is whether the first exercise resulted in a rating of Ms Cooper's job, or the giving to Ms Cooper's job of a value. It is wholly plain that it did not. So far as all the other posts were concerned, there is no doubt at all that the Review was concluded, and the posts were rated accordingly. So far as SPSs were concerned, it is quite clear that no conclusion was reached: that the apparent ratings were clearly anomalous, and that no attempt to deduce from the benchmarks, which were considered to be unrepresentative, a value for Ms Cooper's or any other of the SPS jobs was made. Instead there was a dedicated and discrete exercise, limited to redoing the evaluation in relation to the SPS jobs.

  109. We are entirely satisfied that the Tribunal was in error in relation to its conclusion, by virtue of not asking itself the right question. In paragraph 50, in very short form, it arrived at the view that it did:
  110. "not consider that it can be said that the 1998 evaluation had not come to any conclusion upon the evaluation of SPS posts … upper and lower and average values were declared for them".

    But the Tribunal neither asked itself the question as to whether Ms Cooper's job was rated or given a value, nor in particular did it address the questions raised in Eaton, namely whether there was a study in relation to the SPSs, which

    "satisfied the test of being thorough in analysis and capable of impartial application"

    or one such as to enable arrival:

    "at the position of a particular employee at a particular point in a particular salary grade".

    Nor did the Tribunal address the fact that it was only the SPS evaluation which was in fact redone in 1999, and that this was clearly redone as a result of the conclusion by the Consultants in 1998 that their work was unfinished. We are satisfied that the only answer that can here be arrived at is that, so far as Ms Cooper's post is concerned, it was not rated or valued within s1(2) of EPA. There was no dispute about the oral evidence, and in any event the issue hangs entirely on what in our view is the only possible construction of the Review itself; and we do not conclude that remission would be appropriate, in a case in which we are entirely satisfied that the only possible result is the reverse conclusion to that which was reached by the Employment Tribunal. Accordingly the appeal in relation to Issue 2 is allowed.

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