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PRESTON and OTHERS v. WOLVERHAMPTON HEALTHCARE TRUST SECRETARY OF STATE FOR HEALTH [1997] EWCA Civ 1013 (13th February, 1997)
IN
THE SUPREME COURT OF JUDICATURE
EATRF
96/0929/B
IN
THE COURT OF APPEAL (CIVIL DIVISION)
EATRF
96/0930/B
ON
APPEAL FROM THE EMPLOYMENT APPEAL TRIBUNAL
Royal
Courts of Justice
Strand
London
WC2
Thursday,
13th February, 1997
B
e f o r e:
LORD
JUSTICE WAITE
MR
JUSTICE SINGER
-
- - - - -
PRESTON
& OTHERS
Appellant
-
v -
WOLVERHAMPTON
HEALTHCARE TRUST
THE
SECRETARY OF STATE FOR HEALTH
Respondent
-
- - - - -
FLETCHER
& OTHERS
Appellant
-
v -
MIDLAND
BANK PLC
Respondent
(Computer
Aided Transcript of the Palantype Notes of
Smith
Bernal Reporting Limited, 180 Fleet Street,
London
EC4A 2HD
Tel:
0171 831 3183
Official
Shorthand Writers to the Court)
-
- - - - -
MR
J CAVANAGH
(Instructed by UNISON WC1H 9AJ) appeared on behalf of the Appellant in the case
of Preston v Wolverhampton Healthcare and others.
MR
CAWS QC / MR T KERR / MR C LEWIS / MR P ELIAS QC / MR J COPPEL / MISS TETHER /
MR PAULS / MR R HILL
(Instructed by The Lewington Partnership B16 9NN) appeared on behalf of the
Respondent
MISS
J NCNEILL
(Instructed
by Lawford & Co TW9 1UF) appeared on behalf of the appeallant in the case
of Fletcher v Midland Bank
MR
PATRICK ELIAS QC and MR J COPPEL
(Instructed by Eversheds EC4V 4JL) appeared on behalf of the respondents.
MR
NICHOLAS PAINE
appeared on behalf of the Secretary of State.
-
- - - - -
J
U D G M E N T
(As
Approved)
-
- - - - -
Crown
Copyright
I
Introduction
LORD
JUSTICE SCHIEMANN: These appeals are against the decision of the Employment
Appeal Tribunal presided over by Mummery J. Various test cases were heard
together and the Tribunal was concerned mainly with various preliminary issues.
The employees lost on those preliminary issues and it is they who appeal.
There is a crossappeal in relation to one issue.
The
present appeals arise out of a mismatch between Community Law (by which I mean
that part of our law which springs from our membership of the European Union)
and Domestic Law (by which I mean that part of our law which does not spring
from our membership of the European Union) during the period prior to 31.5.1995
[1].
During that period Community Law made unlawful but Domestic Law permitted
indirect sex discrimination in relation to the grant of access to an
occupational pension scheme. The problems in the present case mainly concern
the position of women who it is assumed were discriminated against and who it
is assumed were unaware of their rights under Community Law. By the time that
they became aware that they had such rights they were potentially disadvantaged
by the application of Section 2 (4) and (5) of the Equal Pay Act 1970
(“the EPA”) which impose time limitations on the exercise of such
rights.
Much
of the argument in these appeals has centred around the interrelation of
Community Law and Domestic Law. Crucial to the solution of the difficulties
which this interrelation poses is to bear firmly in mind that, just as Domestic
Law is part of English Law, so Community Law is part of English law. Parliament
has so enacted in section 2(1) of the European Communities Act. 1972.
"All
such rights ..... from time to time created or arising under the Treaties, and
all such remedies and procedures from time to time provided for or under the
Treaties, as in accordance with the Treaties are without further enactment to
be given legal effect or used in the United Kingdom shall be recognised and
available in law, and be enforced, allowed and followed accordingly ..."
Where
our courts feel difficulty in ascertaining what Community Law is on a
particular point they are able, under Article 177 of the Treaty of Rome
(“the Treaty”), to obtain binding preliminary rulings from the
European Court of Justice (“the ECJ”) but this must not blind us to
the fact that Community Law is part of English Law just as an Act of Parliament
or a Statutory Instrument or the Common Law are parts of English Law.
The
other point which has to be borne firmly in mind is that where there is a
conflict between Community Law and Domestic Law, Community Law prevails. The
position is similar to a conflict between a Statutory Instrument and a Statute
: where there is a conflict, the Statute prevails. The rule as to what prevails
in the event of conflict between Domestic Law and Community Law is a rule of
Community Law which, by virtue of the European Communities Act, has become a
rule of English Law.
The
legal technique which is used for resolving such a conflict between Domestic
and Community Law is for the Court to disapply that part of Domestic Law which
conflicts with Community Law.
The
legal points for decision on these appeals arise in claims for unlawful
exclusion of part-time and retired part-time workers from contributory and
non-contributory pension schemes. The principal features of the claims are as
follows:-
(1) The
Applicants in the 22 originating applications submitted as test cases are, or
were at some time, part-time workers employed either by public or private
sector employers and had been excluded from occupational pension schemes with a
qualifying condition of membership based on a minimum number of hours worked
each week.
(2) The
Applicants claim access to membership and recovery of contributions from
employers in respect of various occupational
pension
schemes, some contributory, some non-contributory. They assert that on its face
the EPA at the relevant times limited their claims and that in consequence no
claims were made.
(3) The
claims were prompted by the decision of the European Court of Justice given on
28.9.94 in the cases of
Vroege
and
Fisscher[2].
The effect of those decisions was to declare that:-
(a) the
right to join an occupational pension scheme falls within Article 119 of the
Treaty and is therefore covered by the prohibition against discrimination by
different treatment in the matter of pay for men and women without objective
justification,
(b) the
limitation on the effect in time laid down by the European Court on 17.5.90 in
the case of Barber v Guardian Royal Exchange Assurance Group Ltd at paragraph
40 et seq does not apply to the right to join an occupational pension scheme.
The Court did not lay down any analagous limitation in respect of such a right.
(4) The
claims are made in reliance on the EPA, Article 119 of the Treaty and the Equal
Pay Directive 75/117/EC (“the EPD”). The essence of the claims
is that the denial of access to part-time workers, of whom a considerably
higher proportion are women rather than men, discriminates indirectly against
women in the matter of pay and is therefore contrary to the EPA and to
Community Law and is unlawful. The majority of the Applicants, except in the
firefighting sector, are women.
(5) The
preliminary points are primarily concerned with time limits and the extent to
which the private and public sector employers who are Respondents to the
claims, may rely on:-
(a) National
rules relating to time limits for bringing actions, and
(b) Temporal
limitations in National law on the retrospective recovery of compensation.
II
The
Relevant Primary Law
Article
119 of the Treaty provides:-
"Each
Member State shall ............. ensure and subsequently maintain the
application of the principle that men and women should receive equal pay for
equal work.
The
EPD provides so far as presently relevant:-
"Article
1.
The
principle of equal pay for men and women outlined in Article 119 of the Treaty,
hereinafter called "principle of equal pay", means, for the same work or for
work to which equal value is attributed, the elimination of all discrimination
on grounds of sex with regard to all aspects and conditions of remuneration.
.........
Article
2.
Member
States shall introduce into their National legal systems such measures as are
necessary to enable all employees who consider themselves wronged by failure to
apply the principle of equal pay to pursue their claims by judicial process
after possible recourse to other competent authorities.
Article
3.
Member
States shall abolish all discrimination between men and women arising from
laws, regulations, or administrative provisions which is contrary to the
principle of equal pay.
Article
4.
Member
States shall take the necessary measures to ensure that provisions appearing in
collective agreements, wage scales, wage agreements or individual contracts of
employment which are contrary to the principle of equal pay shall be, or may be
declared, null and void or may be amended.
.......................
Article
6.
Member
States shall, in accordance with their National circumstances and legal
systems, take the measures necessary to ensure that the principle of equal pay
is applied. They shall see that effective means are available to take care
that this principle is observed.
Article
7.
Member
States shall take care that the provisions adopted pursuant to this Directive,
together with the relevant provisions already in force, are brought to the
attention of employees by all appropriate means, for example at their place of
employment.
Article
8.
1. Member
States shall put into force the laws, regulations and administrative provisions
necessary in order to comply with this Directive within one year of its
notification .......
It
has been established by the ECJ that right of access to pension schemes is to
be regarded as part of pay for the purposes of Article 119 and the Directive.
The
rules of Domestic Law which it is sought to disapply as being in conflict with
Community Law are contained in two subsections of section 2 of the EPA as
modified.
Section
2(4) provides:-
"No
claim in respect of the operation of an equality clause
[3]
relating to a woman's employment shall be referred to an industrial tribunal
...... if she has not been employed in the employment within the six months
preceding the date of reference."
Section
2(5) provides:-
"A
woman shall not be entitled, in proceedings brought in respect of a failure to
comply with an equality clause ...... to be awarded any payment by way of
arrears of remuneration or damages in respect of a time earlier than two years
before the date on which proceedings were instituted".
In
the context of pensions, the operation of s.2(5) is modified by Regulation 12
of the Occupational Pensions Schemes (Equal Access to Membership) Regulations
1976 ("the 1976 Regulations"). This entitles a court or tribunal which finds
that there has been a breach of the equality clause in a contract of employment
to make a declaration that the employee has a right of admission to membership
of the scheme. However it is provided that no order may be made declaring the
right of an employee to admission to membership of a scheme in respect of a
period earlier than two years before the institution of proceedings.
III
The
applicants submit that Community Law gives them rights springing first from the
Treaty ("Treaty Rights") and secondly from the EPD ("Directive Rights"). The
Respondents accept that the appellants have Treaty Rights; they do not accept
that the Appellants have Directive Rights. It is therefore convenient to look
first at whether there is any conflict between Treaty Rights and Domestic Law.
The
following is common ground. Article 119 of the EC Treaty has horizontal
direct effect, i.e., it may be relied upon by claimants in domestic courts and
tribunals both against the State and against private individuals.
[4]
Exclusion of part time workers or any other group of workers from access to
a pension scheme is contrary to Article 119 if it amounts to indirect sex
discrimination, ie if a considerably greater proportion of part time workers
are women than men and the exclusion cannot be explained on the basis of
objectively justified factors unrelated to discrimination on grounds of sex.
[5]
That principle has most recently been affirmed in case
C-435/93
Dietz
.
It
is common ground that at all material times a citizen was entitled to enforce
his Treaty Rights in our courts. But what if he is met by a national limitation
period or some other procedural rule which inhibits the full breadth of a
possible claim? That is the main problem posed by these cases.
It
is not a new problem. There is a long line of ECJ authority concerned with it.
A relatively recent example is
Fisscher
where the ECJ said
39 The
court has consistently held that, in the absence of Community rules on the
matter, the national rules relating to time limits for bringing actions are
also applicable to actions based on Community law, provided that they are no
less favourable for such actions than for similar rights of a domestic nature
and that they do not render the exercise of rights conferred by Community law
impossible in practice: see in particular
Rewe
[1976] ECR 1989 paragraphs 5 and 6.
These
have become known as the
Rewe
provisos. The rationale behind this doctrine is that
1.
The principle of legal certainty requires that there be rules which lay down
limitation periods etc.;
2.
Where there is no applicable Community legislation setting out such periods ,
the only place one can look is national legislation;
3.
However, the principle of the supremacy of Community Law requires that national
legislation be disapplied if either it is so framed as to give rights arising
under Community Law inferior treatment to that given to equivalent rights
arising under Domestic Law or it is so framed as to render rights given by
Community Law almost impossible to enforce.
The
phrase “impossible in practice” used in
Rewe
clearly has in it a certain margin of appreciation. Nevertheless the case law
of the ECJ indicates that it is to be construed strictly and, in my judgment,
points against accepting the submission that where the common understanding is
that there are no applicable rights under Community Law this renders the
exercise of rights conferred by Community Law impossible in practice. That is
not the situation at which the doctrine behind the decision in
Rewe
is aimed. Indeed the decision in
Rewe
itself would probably have been different had the ECJ considered that general
ignorance of the applicable rights under the Treaty rendered the exercise of
those rights impossible in practice.
[6]
The issue in that case was whether a time limit under German Domestic Law had
to be set aside as incompatible with Community Law. The time limit on its face
prevented a claim for a refund of charges which had been imposed contrary to
Community Law. The time limit had expired before it was established that the
imposition of the charges was indeed unlawful under Community Law. Nonetheless
the state was held by the ECJ to be entitled to rely on the time limit imposed
under Domestic Law as a defence to an action for repayment.
IV
Compatibility
of s.2(4) with Article 119 rights:Inferior treatment?
The
Appellants submit that the present case falls within the first of the
Rewe
provisos and submit that the conditions for the exercise of Community Law
rights are less favourable than those which apply to purely domestic rights in
similar domestic actions and therefore s.2(4) ought to be disapplied. The
obvious difficulty that this contention faces is that the same limitation
period faces all claims under the EPA and that the EPA is the mechanism by
which a claim in respect of infringement of Article 119 rights comes before the
English courts.
The
appellants seek to overcome this by submitting that the EPA is exclusively
concerned with enacting Community Law rights into Domestic Law and therefore
can not be used as a comparator. I reject the premise. The EPA was enacted
before the UK joined the Community although it was admittedly not brought into
force until after our joinder. Moreover, there are periods when it was in force
but there were rights to which it applied which rights beyond argument did not
at the relevant time have a Community source.
But
even if the EPA had been enacted purely in order to implement in Domestic Law
the provisions of Article 119 of the Treaty, it does not follow from the
Rewe
decision that this court is obliged to cast around the whole of Domestic Law in
order to discover some other legislation, such as the Race Relations Act 1976
(“the RRA”) upon which the Appellants rely, which is concerned with
some other sort of equality in order to see whether the limitation periods in
that Statute are in certain circumstances more generous than those in the EPA.
Our Domestic Law, as no doubt the domestic law of other Member States, has
innumerable different time limits in relation to innumerable different
situations. Some of those time limits incorporate a certain degree of flexibility
[7],
others don’t. It is not, and could not be, suggested that this in itself
is contrary to Community Law. What is objectionable is discrimination in the
treatment of similar claims as between claims based on domestic law and claims
based on Community Law. That does not exists in the present cases.
Moreover,
even if it were appropriate to have regard to the RRA, the time limit under
that Act
[8]
is not clearly less favourable than the time limit under the EPA. It is
shorter but with provision for a discretionary extension.
I
reject the submission that it is appropriate in this context to look at the RRA
at all. The obvious starting point must be the EPA. On the face of it all
claims are treated equally under that act and there is no element of inferior
treatment. At first blush, that is the end of the point. Further consideration
makes it no more attractive.
I
regard this point as
acte
clair.
Compatability
of s2(4) with Article 119 rights: Impossible in practice?
The
Appellants submit that they can rely on the second of the
Rewe
provisos. They submit that in the circumstances of these cases it has been
impossible for them in practice to enforce their Community Law rights until
shortly before the present applications were made and that therefore the time
limit in s.2(4) ought to be disapplied. The respondents submit that there has
been no such impossibility in practice.
All
the legal systems of Member States recognise the need for limitation periods.
Various Community Law legislative acts do lay down limitation periods for
various purposes but none of them are presently applicable. In those
circumstances it is settled Community Law that limitation periods may be
imposed by Member States until such time, if any, as harmonisation of the
differing current positions takes place. The mere fact that there is a
limitation period does not render the Community Law right impossible to
enforce. Nor, as such, is a six month period impossibly short. All that is
common ground.
The
Appellants’ argument in this regard is essentially that there was not
until relatively recently widespread appreciation of the fact that Community
Law gives a right not to be discriminated against in respect of pension schemes
such as those presently in issue. That as a broad proposition I am content to
accept for present purposes. They submit that as a result it was impossible
in practice to start proceedings within the six month period. This I reject :
the conclusion does not follow from the premise. It is a common feature of law
that there are points of uncertainty and that from time to time a case
demonstrates that the Courts have given effect to a claim which it was
generally felt before that time would, as a matter of law, not succeed. Whether
one calls this process judicial law “making” or judicial law
“declaring” is perhaps a matter of personal preference. It is of no
present importance. Such “law making” is the ineluctable result of
the fact that from time to time novel claims are made and judges must reach a
decision on the cases that come before them. That such judicial activity goes
on is true of Domestic Law and of Community Law. The very fact that the
innovative litigant has persuaded the innovative court to find in his favour
shows that doing so is not impossible in practice.
The
Appellants point to the undoubted fact that in the interests of legal certainty
and in order to avoid chaos the ECJ at times limits the retrospective effect of
its judgments
[9].
However, contrary to the Appellants’ contentions, it does not follow
from this that it is appropriate to disapply periods of limitation during times
of uncertainty as to the law. On the contrary, the major function of
limitation periods is the protection of legal certainty. To disapply them
takes away from legal certainty. It should only be done when in truth they are
so short as to make it practically impossible to enforce one’s rights.
That is not this case. It is beyond argument that the Applicants were always in
a position in which they were possessed of the relevant rights and could have
asserted them. As a matter of English Law the courts would have to give
precedence to any directly effective Community right and disregard any
provision of Domestic Law purporting to exclude or limit that Community right:
See
Biggs
V Somerset County Council
[1996] ICR 364 at page 374 to 376. The period of 6 months is well in excess
of periods which have been held to be compatible with Community Law.
I
reject the applicants’ contentions that it was impossible in practice to
start proceedings within 6 months of the act of discrimination. I regard the
matter as
acte
clair.
VI
Compatibility
of s.2(5) with Art 119 Rights
In
this context the appellants repeat arguments based on impossibility and
inferior treatment which they deployed in their attacks on s.2(4). I reject
them both for the reasons which have been set out in the preceding two sections
of this judgment.
The
Appellants however put forward two further submissions in support of their
claim that s.2(5) should be diapplied - the Marshall
[10]
submission and the Fisscher submission. I look at them in that order.
The
Marshall Submission
In
Marshall,
the Domestic Law provision which it was sought to disapply was s.65(2) of the
Sex Discrimination Act 1975 as amended. This set a cash figure limit on any
compensation which could be awarded for acts of sex discrimination. The ECJ
held that such a limit was incompatible with the Equal Treatment Directive.
The
appellants submit that the limitation in s.2(5), as modified by the 1976
Regulations constitutes a similar limit. I disagree. S.2(5) need not limit any
person’s claim provided that person institutes proceedings in time. Such
a limitation is wholly compatible with Community Law - see the decisions in
Steenhorst-Neerings
and
Johnson.
That disposes of the point.
The
Fisscher Submission
In
the course of its judgment in
Fisscher
the ECJ said at paragraph 27
“...
the direct effect of Article 119 can be relied on in order retroactively to
claim equal treatment in relation to the right to join an occupational pension
scheme and this may be done as from 8 April 1976, the date of the judgment in
Defrenne
... in which the court held for the first time that Article 119 has direct
effect.”
The
applicants submit that the two year limitation in s2(5) as modified by the 1976
Regulations contravenes this statement of the law and that it should therefore
be disapplied.
The
sentence in the ECJ’s judgment upon which the applicants rely appears in
its answer to the second question posed by the national court, namely, whether
the limitation of the effects in time of
Barber
also applies to the right to join an occupational pension scheme. That question
it answered in the negative. However, that is a separate matter from the
availability of Domestic Law time limits, as to which, in answer to the fifth
question posed by the national court, the ECJ held, as appears from the
citation earlier in this judgment, that Domestic Law was supreme, subject only
to the
Rewe
provisos.
It
follows that I reject the submission based on
Fisscher.
Conclusions
on s.2(5)
The
applicants make the fair point that anyone now trying to enter a pension scheme
to which, on its face, they were denied entry years ago, will not be credited
with all their years service. This however is the consequence of the fact that
they did not invoke their rights under Article 119 soon enough. They are thus
in a situationn which is typical of anyone faced with a limitation period who
has let time slip by for perfectly understandable reasons.
VI
We
record that the appellants submitted, as a separate point, that Regulation 11
of the 1976 Regulations should be disapplied as being contrary to Community Law.
The
Regulation reads
The
EPA shall be so modified that there shall be no power for a court or tribunal
to award damages in respect of any failure to comply with the equal access
requirements.
The
Appellants submitted that
a
remedy only of a declaration is not an adequate remedy. As every entitlement to
pension involves an eventual claim for pension benefits, the provision of a
remedy only of a declaration is not an adequate remedy.
I
reject this submission. The essence of the discrimination of which complaint
is made is that access to the scheme was denied. That can be put right by
obtaining a declaration of right and using the mechanism of Regulation 12. This
will, provided that action is taken in good time, give to the applicant all
that she would have had if there had been no discrimination.
If,
as I hold, the appellants’ other arguments fail, there is here no
separate argument which can succeed.
VII
The
Emmott point
Although
for reasons of exposition I have left this point until now, it constitutes the
appellants first ground of appeal which reads as follows:-
"The
Employment Appeal Tribunal was wrong in Law in holding that there should be no
reference to the European Court of Justice for a preliminary ruling upon a
question or questions which ask whether the principle laid down by the ECJ in
Emmott
v Minister for Social Welfare
[1991] ECR 1-4269 has the effect that time did not begin to run in the
proceedings herein for the purposes of the time limit in Section 2(4) of the
EPA until 31.5.95 (the date upon which the United Kingdom law first provided a
remedy for a person who suffered indirect discrimination in respect of the
grant of access to a pension scheme)."
Underlying
this ground of appeal is a premise which I reject. That premise is that UK law
did not provide a remedy for a person who suffered indirect discrimination in
respect of the grant of access to a pension scheme. It is clear that English
law since the coming into force of the European Communities Act 1972 did
provide a remedy by virtue of the fact that Community Law is part of English
law and Community Law provided a remedy. The Appellants alleged problem is
that they did not appreciate that they had a remedy.
Emmott
was a case which arose because the Irish government had not correctly
transposed the Equal Treatment Directive 79/7/EEC on the progressive
implementation of the principle of equal treatment for men and women in matters
of social security. The facts were unusual. The relevant Irish legislation
discriminated at all material times unfairly against married women. This was
established by a judgment of the ECJ in another case delivered on 24.3.1987
[11].
Thereupon Mrs Emmott entered into correspondence with the Minister for Social
Welfare with a view to obtaining as from 23.12.84 the same amount of benefits
as that paid to a married man in a situation identical to hers. By letter of
26.6.87 the Minister replied that since the Directive was still the subject of
litigation before the High Court no decision could be taken in relation to her
claim which would be examined as soon as that court had given judgment. Mrs
Emmott brought proceedings for Judicial Review in the course of which the
national authorities concerned pleaded her delay in initiating proceedings as a
bar to her claim. They relied upon a time bar in relation to proceedings for
Judicial Review. The Irish Court on a reference under Article 177 of the
Treaty asked whether it was contrary to the general principles of Community Law
for the relevant authorities of a Member State to rely upon national procedural
rules in particular rules relating to time limits in bringing claims in defence
of a claim such as that of Mrs Emmot so as to restrict or refuse such
compensation. The ECJ said this:-
"As
the Court has consistently held .................. in the absence of Community
rules on the subject, it is for the domestic legal system of each Member State
to determine the procedural conditions governing actions at law intending to
ensure the protection of rights which individuals derive from the direct
effects of Community Law, provided that such conditions are not less favourable
than those relating to similar actions of a domestic nature nor framed so as to
render virtually impossible the exercise of rights conferred by Community Law.
Whilst
the laying down of reasonable time limits which, if unobserved, bar
proceedings, in principle satisfies the two conditions mentioned above, account
must nevertheless be taken of the particular nature of Directives.
According
to the third paragraph of Article 189 of the EEC Treaty, a Directive is to be
binding, as to the result to be achieved, upon each Member State to which it is
addressed, but is to leave the National authorities the choice of form and
method. Although that provision leaves Member States free to choose the ways
and means of ensuring that a Directive is implemented, that freedom does not
affect the obligation imposed on all the Member States to which a Directive is
addressed, to adopt, within the framework of their National legal systems, all
the measures necessary to ensure that the Directive is fully effective, in
accordance with the objective which it pursues (See judgment in
Case
14/83 Colson
[1984] ECR 1891).
In
this regard it must be borne in mind that the Member States are required to
ensure the full application of Directives in a sufficiently clear and precise
manner so that, where Directives are intended to create rights for individuals,
they can ascertain the full extent of those rights and where necessary rely on
them before the National court ..........................
So
long as a Directive has not been properly transposed into National Law,
individuals are unable to ascertain the full extent of their rights. ...........
Only
the proper transposition of a Directive will bring that state of uncertainty to
an end and it is only upon that transposition that the legal certainty which
must exist if individuals are to be required to assert their rights is created.
It
follows that, until such time as a Directive has been properly transposed, a
defaulting Member State may not rely on an individual's delay in initiating
proceedings against it in order to protect rights conferred upon him by the
provisions of the Directive and that a period laid down by National law within
which proceedings must be initiated cannot begin to run before that time. (My
emphasis. It is to this that I refer hereafter as “the
Emmott
principle”).
Emmott
while it has not been overruled by the ECJ, has been consistently confined to
its facts. The position has recently and authoritatively, and in my respectful
opinion correctly, been considered by Advocate General Jacobs in the opinion
which he delivered in
Denkavit,
Case C-2/94 [1996] 3 CMLR 504 at 524 where he said this:-
"The
Court has had occasion to consider the
Emmott
judgment in Steenhorst-Neerings
[12]
and Johnson
[13],
which concerned limits on claims for arrears on benefits. The Court held that
Community Law did not preclude reliance on such limits even where the relevant
directive had not been properly implemented in National law. The Court
distinguished Emmot, observing that the result in that case could be explained
by "the particular circumstances of the case". The circumstances pointed to
by the Court were as follows: Mrs Emmott has sought payment of the benefits
in question on the basis of the Court's judgment in
McDermott
and
Cotter
:
The administrative authorities had declined to adjudicate on her claim until
the litigation concerning the Directive pending before the National courts had
been concluded; and the authorities sought to rely on the time limit
notwithstanding the failure correctly to implement the Directive. In
Steenhorst-Neerings
and
Johnson
the Court distinguished the rules in issue in those cases on the ground that
neither rule constituted a bar to proceedings; they merely limited the period
prior to the bringing of the claim in respect of which arrears of benefit were
payable.
From
the judgments in
Steenhorst-Neerings
and
Johnson
it may be inferred that the mere fact that a Directive has not been properly
implemented does not, in the absence of other circumstances preclude a Member
State from relying upon a limitation period; if the Court's reasoning in
Emmott
is read without qualification it would apply equally to limits on claims for
arrears of benefits. It seems to me that the judgment in
Emmott,
notwithstanding its more general language, must be read as establishing the
principle that a Member State may not rely on a limitation period where a
Member State is in default both in failing to implement a Directive and in
obstructing the exercise of a judicial remedy in reliance upon it, or perhaps
where the delay in exercising the remedy - and hence the failure to meet the
time limit - is in some other way due to the conduct of the National authority.
A further factor in
Emmott
was that the Applicant was in the particularly unprotected position of an
individual dependent on social welfare.
Seen
in those terms the
Emmott
judgment may be regarded as an application of the well established principle
that the exercise of community rights must not be rendered "excessively
difficult" ........... That view is consistent with the Court's remark in
Johnson
that the time bar in
Emmott
"had the result of depriving the Applicant of any opportunity whatever to rely
on her right to equal treatment under the Directive", whereas the application
of the rules in
Steenhorst
Neerings
and
Johnson
did not "make it impossible to exercise rights based on the Directive". It is
also consistent with the Court's approach in
Peterbroeck[14]
where the Court, although regarding a sixty day period for raising submissions
as unobjectionable per se, concluded that the rule made reliance upon Community
Law excessively difficult given the special features of the procedure.
The
Emmott
judgment may nevertheless be seen as a new application of that principle
insofar as it demonstrates that a National court may be obliged to set aside a
limitation period which is in principle unobjectionable where the special
circumstances of the particular case so demand. It seems to me, in the
interests of legal certainty, the obligation to set aside time limits should be
confined to wholly exceptional circumstances such as those in
Emmott."
The
Court did not find it necessary in the event in
Denkavit
to address the question with which this part of the Advocate General's opinion
dealt. I respectfully agree with his analysis of the case law and see no
advantage in lengthening this judgment by setting out the facts and judgments in
Steenhorst-Neerings
and
Johnson
upon which it is based.
Thus,
narrowly read, the
Emmott
principle does not help the Applicants who cannot rely on circumstances
remotely resembling those of Mrs Emmott.
Quite
apart from this the Respondents submit that the
Emmott
principle only applies where rights are given for the first time by a Directive
[15]
whereas the present situation is one where the Directive gave the Applicants no
new substantive rights: they all had rights under Article 119 before the
Directive was enacted. There has not, they point out, been any case where the
Emmott
principle has been applied to a Directive which does not add to the substantive
rights which have already been given to an applicant under Community Law. The
Appellants reply to that contention that while they acknowledge that the EPD in
no way alters the content or scope of the principle of equal pay outlined in
Article 119
[16]
and while they accept that Article 119 applies directly in UK courts and
tribunals without the need for more detailed implementing measures on the part
of the Community or the Member States, they submit that the point of the EPD is
that it gives individuals a right to be able to discover their right to equal
pay by looking at domestic legislation.
While
it is established law that a Directive can confer rights to individuals which
they can enforce vertically against emanations of the State it is also
uncontroversial that not every Directive has this effect. In my judgment it is
clear that this one does not. I respectfully agree with Neill LJ in
Biggs
when he said at page 377G:-
"Can
it be argued that a separate claim may be made under the EPD which is not
subject to any time limit until the UK Law has been brought into conformity
with Community Law? I am satisfied that such an argument must be rejected.
The principle that men and women should receive equal pay was set out in
Article 119 of the EEC Treaty. The EPD was adopted in order to implement the
principle in Article 119. In these circumstances it does not seem to me that
the EPD conferred any new or separate rights. It follows that in the
circumstances of this case I can see no room for the application of the
Emmott
principle to the EPD."
[17]
The
doctrine of direct vertical effect has been developed in order to prevent the
state from taking advantage of its own failure to enact a directive into its
national law. Where the national law does provide a remedy the doctrine of
direct vertical effect does not come into play. Nor does the
Emmott
doctrine.
The
Applicants suggest that if the EPD does not give any rights to individuals it
serves no purpose. We are unable to accept this submission. There are plenty
of Directives which give no rights to individuals. The individual may well
be better off now that we have brought our domestic legislation into a clearer
form so that the scope of the rights given by Article 119 is more readily
ascertainable. But it does not follow from this that an individual is given a
right to have this done. Nor, I observe in passing, is it established in the
present case that if it had been done the individuals concerned would in fact
have started their actions in time.
VII
Should
a reference be made of the
EMMOTT
point?
One
would only do this pursuant to Article 177 if it is necessary to do so in order
to give judgment. It is common ground that in relation to most of the test
cases which were being considered by the EAT, on the assumption that the
submissions discussed in the earlier parts of this judgment are decided against
the appellants, it is not necessary to refer the
Emmott
point. There are a number of reasons for this.
1.
Some of the respondents are private sector employers and therefore the doctrine
of direct vertical effect has no application to them.
2.
The
Emmott
point has no effect on the limitation on retrospective access to schemes laid
down in s. 2(5). That is common ground and follows from
Steenhorst-Neerings
which was confirmed in
Johnson,
in which the Court of Appeal referred to the ECJ a question directed
specifically at the effect of
Emmott.
At paragraphs 30-35 the ECJ considered
Emmott
and
Steenhorst-Neerings.
It ruled that:
Community
law does not preclude the application, to a claim based upon the direct effect
of Council Directive 79/7/EEC of 19 December 1978 on the progressive
implementation of equal treatment for men and women in matters of social
security, of a rule of national law which merely limits the period prior to the
bringing of the claim in respect of which arrears of benefit are payable, even
where the Directive has not been properly transposed within the period in the
Member State concerned.
In
some of the test cases, the appellants are thus caught by s.2(5) and so a
diapplication of s.2(4), to which alone
Emmott
has relevance, will not advantage them.
3.
The principle of equal pay has been complied with in the NHS Pension Scheme and
local government schemes since, respectively, April 1991 and August 1993
(backdated access to the local government schemes was made available with
effect from 1 January 1993). None of the present applications were brought
until late in 1994. Accordingly, even if
Emmott
was of any application here, its application in relation to those schemes would
have ceased on those dates.
However,
it is common ground that there are some amongst the appellants who are in a
position to take advantage of the
Emmott
point. In consequence, I accept that it is necessary in their cases to give a
ruling thereon in order to give judgment. The question therefore arises whether
we should ask the ECJ to give a ruling thereon. We should not do so if the
matter is
acte
clair.
I tend to the view that the matter is
acte
clair
but in any event would not regard it right in our discretion to refer the
matter the the ECJ. That is because these cases may go to the House of Lords
and the appellants may wish some or all of the other matters to be referred to
the ECJ. It would be undesirable for this court to refer one matter to the ECJ
whilst the possibility existed that the House of Lords wished other matters to
be referred. The delays involved in two separate references, one by this court
and then another one by the House of Lords should it not share this
court’s view that the other matters are
acte
clair,
are not to be contemplated
.
VIII
Section
2(4) of the EPA and the Cross Appeal
As
to these matters I agree with the judgment of Otton LJ.
IX
Conclusion
I
would dismiss the appeals and the cross appeal.
LORD
JUSTICE OTTON: I have read the judgement of Schiemann LJ in draft and agree
with the reasoning and conclusions in all of the issues addressed.
The
issue raised is whether, as a matter of domestic law, time starts to run under
section 2(4) from the end of the contract of employment under which equality is
claimed, or from the end of an employment relationship, more broadly defined,
which may be pursuant to a number of different contracts of employment. In
other words, the question to be answered is the meaning to be given to the
requirement in section 2(4) that a complainant must have been "employed in the
employment" to which the claim relates within six months of the presentation of
her complaint, in circumstances where an employee has breaks in service.
"No
claim in respect of the operation of an equality clause relating to a woman's
employment shall be referred to an industrial tribunal --- if she has not been
employed in the employment within the six months preceding the date of the
reference."
This
issue is one of domestic law only. It affects workers in the public sector
more than private sector workers and in particular part time teachers teaching
at the same school or college for a number of years under a succession of fixed
term contracts for each term, with breaks between contracts during the school
holidays and college vacations. It also affects similar staff employed for the
academic year only, with a break between the end of one academic year and the
beginning of the next.
The
Industrial Tribunal decided that :
1. Claims
are only in time if commenced within six months of the end of the contract of
employment containing the equality clause allegedly breached.
2. Periods
of employment covered by previous contracts do not give rise to a cause of
action, unless proceedings have been instituted within six months of their
termination.
3. This
reasoning applies to all such contracts, including term and academic year
contracts.
The
EAT upheld this decision and the reasoning. At page 37B:
"In
our judgment, the time limited under S.2(4) runs from the end of each contract
under which a part-time employee is employed and not from the end of any
employment with the employer comprehending a succession of different contracts
of employment with the same employer."
The
Notice of Appeal asserts that the EAT was wrong in law in adopting this
construction and they ought to have held that :
a. The
entirety of a claim is in time if the claim is made within six months of the
end of the period of regular employment in which there are regular breaks in
the contract of employment.
b. The
entirety of a claim is in time if the claim is made within six months of the
end of a period during which the applicant has been employed in irregular
employment in the same capacity (eg supply teachers) whether or not there is an
"umbrella contract".
c. There
is no basis for placing a gloss on S.2(4) so as to require that the claim is
made within 6 months of the ending of the same contract as that in respect of
which the claim is made.
Miss
Jane McNeill in an able argument (adopted by Mr John Cavanagh) identifies 4
types of contract where breaks of service occur:
1. Regular
employment with regular breaks in the contract of employment (teachers with
termly or academic year contracts).
2. Irregular
employment in the same capacity where there is an "umbrella" contract.
3. Irregular
employment in the same capacity where there is no umbrella contract (supply
teachers or home tutors).
4. A
complete break in employment followed by re-employment some years later.
As
regards category 2, the EAT acknowledge that where there is an umbrella
contract there is a continuing contractual relationship. No point thus arises.
Miss
McNeill contends that S.2(4) does not in terms refer to the
same
contract of employment. It makes no sense for the time limit not to cover the
whole period of a person's employment if the breaks in service flow from the
nature of the work and are a direct consequence of it. A teacher may work year
after year without a contract covering her for the school holidays, or, at
least, the summer holidays. Nevertheless, she will be doing a full year's
teaching work. The only difference between such a teacher and a full-time
teacher will be the way in which the employer decides to order its affairs.
The EAT's approach does not follow from the language of the EPA as a whole.
There is no definition of "employment" for the purposes of S.2. "Employment"
is defined for the purposes of S.1(6)(a) to mean employed under "
A
contract of service
"
or apprenticeship or for services. It cannot mean employed under a particular
contract of service by virtue of the phrase "a man in the same employment" in
sections 1(2)(a)(b) and (c). Two different people cannot be employed under the
same contract of employment. S.1(8) extends the meaning of "employment" to
engagements otherwise than under a contract.
Ms
Genevra Caws QC and Mr Patrick Elias QC contend that the word "employment" in
the phrase "in the employment" must refer back to and have the same meaning as
"a woman's employment". The earlier phrase requires reference back to S.1 of
necessity since S.2(4) is dealing with a time limit on bringing a claim to
enforce a right which is conferred by S.1. The right so conferred is to the
importation of an equality clause into a
specific
contract of employment. This is a construction that follows as a result of the
"equality clause" mechanism employed by and within the Act and the necessary
inter-relationship between sections 1 and 2. This construction does not
involve reading the word "same" into section 2.4 so that it reads "the same
contract of employment".
I
am unable to accept the argument advanced on behalf of the appellants. It is
common ground that an umbrella contract constitutes a single contract of
employment, so that time runs from the ending of it, not from the beginning of
a break in service under it. Conversely the appellants accept (as to category
4) that where there is a "complete" break in employment, subsequent
re-engagement by the same employer does not make time run afresh in relation to
the earlier employment. The appellants contend, in reality, that the mere
repetition of episodes of service, whether or not on a regular pattern, means
that the employee is "employed in" a single "employment" stretching over all
the periods of employment.
When
S.2(4) is construed in the light of S.1 and S.2(1) the time limit which it
imposes runs from the end of the contract of employment alleged to contain the
equality clause in respect of which the claim is made. This construction does
not involve placing a gloss by way of the addition of the word "same" on the
section. I accept Mr Elias's submission :
"Rather
it entails giving S.2(4) a meaning consonant with the statutory scheme of which
it forms a part."
Moreover
the construction contended for by the respondents is consistent with the
provisions of the SDA 1975 where :
1. S.82
defines "employment" as employment under
a
contract
of service.
2. S.76(6)(a)
requires that a claim challenging the inclusion of an unlawful term in a
contract be presented within three months of the termination of that contract.
Both
the EPA and the SDA are parts of a single comprehensive code and thus must be
construed as a single and harmonious whole (see Shields v E Coombes (Holdings)
Limited 1978 ICR 1159).
It
follows that I am not persuaded that the legislature inadvertently overlooked
the need to include provisions bridging breaks in service which relate to the
nature of the work. Even if that were so, it would be impossible to state with
certainty what additional words Parliament would have included if the omission
had been drawn to its attention, accordingly it would be wrong for the Court to
add its own (see Wentworth Securities Limited v Jones 1980 AC 74).
Accordingly
I cannot fault the approach, reasoning or conclusion of the EAT on this issue.
The
Cross Appeal - Claims by male part-time workers
The
Industrial Tribunal held that a male part-time worker could bring a claim for
equal access to an occupational pension scheme even though no woman applicants
claim had by then succeeded, and that his access should be back-dated to the
same point in time as that to which a female part-time worker was given
retrospective access to the scheme. Thus claims by male applicants which were
not struck out as being out of time should remain stayed until a female
applicant succeeded in gaining admission to the relevant scheme. The EAT
upheld that part of the decision.
By
a Respondent's Notice the Secretary of State contends that the EAT erred in law
in failing to find that a male employee is not entitled to claim a right of
admission to an occupational pension scheme on the grounds that a term of the
scheme excluding a group of employees to which he belongs is indirectly
discriminatory against a group predominantly composed of women. Further, the
EAT erred in holding that where a female employee is granted a declaration that
she is entitled to be admitted to such a scheme with effect from a date earlier
than that on which she is in fact admitted to the scheme, a male employee is
entitled to a corresponding declaration in his favour with effect from that
same date. In truth, the declaration granted to the female employee is a
remedy for past discrimination against women and its grant does not create a
right to a corresponding declaration in favour of a man since there was no
discrimination against men. A male employee could only bring proceedings in
the event that the terms of such a scheme were or became discriminatory against
men which is not the case here.
Mr
Nicholas Paines submitted that the reasoning of the IT and the EAT is
fallacious. It does not take into account the fact that a male part-time
worker cannot claim admission to the scheme on the basis that the exclusionary
term constitutes discrimination against women. The flaw in the reasoning is
that it fails to appreciate that it is discrimination in the
terms
of a scheme that gives rise to the right to a remedy in the form of equality
with a full-time employee, and that that right is only enjoyed by a member of
the sex discriminated against. The granting of the remedy to that sex cannot
logically entail the granting of the remedy to the other sex also. The correct
course is to strike out claims by men. This would enable a man to bring a
fresh complaint for the future in the (perhaps unlikely) event that the terms
of the scheme were to provide that only female part-time workers would be
admitted.
As
indicated at the beginning of the judgment by Schiemann LJ, prior to 31 May
1995 domestic legislation excluded those who worked less than a given number of
hours per week from entitlement to join certain occupational pension schemes.
In consequence many schemes excluded part time workers. This involved indirect
discrimination against women in breach of their rights under Article 119 of the
Treaty. Manifestly their was no discrimination against men.
The
women have always been able to bring proceedings relying on their Treaty rights
and asking the court to disapply those provisions which prevented them from
joining the pension schemes. Some of the women have done so prior to 31 May
1995. Although those proceedings have not yet been concluded it may be that as
a result some women will be admitted to the schemes.
The
cross appeal is concerned with the position of men. Prior to 31 May 1995 the
men were not discriminated against by the schemes either directly or
indirectly. That much is common ground. By contrast, women were discriminated
against and are entitled, subject to the provisions of s.2(4) and (5) of the
EPA, to the increased benefits resulting from their service prior to 31 May
1995. It is pointed out that male part timers, depending on the terms of
various pension schemes, may eventually be put in a position where they are
less well off than female part timers.
The
IT, whose decision has been upheld by the EAT on appeal, was only concerned
directly with the position of one man, Mr Mannion, who was chosen as a test
case. The IT struck out his claim, the EAT dismissed Mr Mannion's appeal, and
of course the Secretary of State has no cross appeal in relation to that
striking out, although the points made in his cross appeal could have been put
into a notice of additional grounds. However in the course of its judgment,
the IT indicated that in principle it was not prepared
at
this stage
to strike out the claim of all part time male employees just because they were
male. The EAT was not prepared to say that the IT was wrong in its approach.
Mr Paines accepted that if, as in the event is the case, Mr Mannion's appeal to
this court failed on the same grounds as the women's appeal, then there is no
need for this court to consider in relation to Mr Mannion the validity of the
points made int he Secretary of State's cross appeal. He accepted that
anything which we might say would be no more than obiter dicta.
The
EAT's reasoning is set out at pages 45-47 of its decision. Essentially it took
the view that a set of facts might, if some of the present women applicants
were successful, arise in which it would be seen that men did not receive equal
pay¹ for equal work. That would be a real injustice to the men. Those
remarks manifestly have some force. I think it would be wrong for this court
at this stage, in the absence of a specific case to the facts of which its
attention has been drawn, to state that all cases of a particular kind should
be struck out. I would dismiss the cross appeal.
Waite
LJ
I
agree with both judgments
[1]
The date of the coming into force of the Occupational Pension Schemes (Equal
Access to Membership) Amendment Regulations 1995.
[2]
Case C-57/93 [1994] ECR1-4541
[ ]4Defrenne
v Sabena
(Number 2)[1976]ECR 455
[6]
The facts in
Rewe
were as follows:-
(1) In
October and November, 1968 and January 1969 charges (the early charges) were
levied by way of notice of assessment which became final unless contested
within one month.
(2) In
March 1970 Rewe, having effected further imports on which charges were levied,
subsequently instituted before the ECJ proceedings contending that these
further charges were contrary to Article 13 of the EC Treaty
(3) In
February 1973 Rewe lodged a protest assessment claiming that the early charges
were contrary to Article 13 of the EC Treaty.
(4) In
March of 1973 the regional authorities rejected the protests as out of time and
Rewe then instituted proceedings challenging this decision.
(5) On
11 October 1973 the ECJ ruled that the further charges in respect of the 1970
importations contravened Article 13.
[7]
I accept that in the employment field no other claim has a completely rigid
time limit which can not be disapplied by the court.
[8]
s.68 provides for a general time limit of 3 months which can be extended in the
discretion of the court or tribunal.
[9]
e.g.,
Defrenne
v Sabena (No.2)
[10]
Marshall
v Southampton and South West Hampshire Health Authority (no.2)
[1993] ICR 893
[11]
McDermott
v Minister for Social Welfare
(Case 286/85) [1987] ECR 1453
[12]
Case C-338/91 [1993] 1ECR 5475
[13]
Case C-410/92) [1994] 1ECR 5483
[15]
As they were in that case by the Equal Treatment Directive
[16]
Jenkins
v Kingsgate (Clothing Productions) Ltd
[1981] ICR 592 at paragraphs 21-22
[17]
We note that leave to appeal in Biggs was refused both by that court and the
House of Lords. It seems no one thought a reference under Article 177 was
necessary. We accept that there is no reason to suppose that the Court was
asked to refer. However we have no doubt that it gave the matter some thought.
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