The claimants had been denied the right to access the respondent’s voluntary pension scheme because they worked part-time. The scheme was found to have caused a disproportionate impact on women, and thus contravened the Equal Pay Act 1970 which states that an occupational pension scheme must be open equally to men and women. The exclusion was removed after the claimants had worked for the respondent for many years. At the ET they sought a declaration which required the employer to admit them to the pension scheme, which some claimants were granted, but only for the period for which they had been denied access to the scheme. The declarations did not include the periods in which they could have joined, but did not join, the scheme. Other claimants, who it was found would not have joined the scheme even if it had been open to them, were not granted declarations in respect of the time when the scheme was closed to them. Both decisions are the subject of this appeal.

The EAT agreed with the declarations granted by the ET, saying first that to allow the declaration to continue up until the time the claimants actually joined the scheme would be to give them an advantage over colleagues who did not so join. They would be in a better position than a full-timer whose contract at all times included a term that he could join the scheme but who never did. They added that, for those claimants who would never have joined the scheme, there was no basis for ordering a declaration that the respondent breached the implied term during the closed period because the claimants had suffered no loss.

_______________

Appeal No. UKEAT/0116/10/ZT

EMPLOYMENT APPEAL TRIBUNAL

58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

At the Tribunal

On 30 September & 1 October 2010

Further submissions on 15 November 2010

Judgment handed down on 23 December 2010

Before

HIS HONOUR JUDGE McMULLEN QC

MR K EDMONDSON JP

MR D SMITH

MS B COPPLE & ORS (APPELLANTS)

LITTLEWOODS PLC & ORS (RESPONDENTS)

Transcript of Proceedings

JUDGMENT

For the Appellant
MR P DRAYCOTT (of Counsel)

Instructed by:
Messrs Russell Jones & Walker Solicitors
1st Floor St James House
7 Charlotte Street
Manchester
M1 4DZ

For the Respondents
MR S BROCHWICZ-LEWINSKI (of Counsel)

Instructed by:
Messrs Mace & Jones Solicitors
Pall Mall Court
61-67 King Street
Manchester
M2 4PD

EQUAL PAY ACT – Part time pensions

The Claimant women were unlawfully excluded from an occupational pension scheme as part-timers, but they would never have joined it if it had been open to them. There is no basis for ordering a declaration that the Respondents breached the implied equality term during the period when the pension scheme was closed to them without there being a corresponding loss. Those who would not have opted to join the scheme are not entitled to the declaration of admission to the scheme. For those who succeeded, the declarations endure only for the closed period. The purely discretionary remedy of a declaration is not inconsistent with EU law.

Appeals dismissed.

1. The issue of principle in this appeal follows denial of access by women to an occupational pension scheme. Does the court give them a remedy when they would never have joined the scheme? For those who would have joined the scheme, are they entitled to a remedy extending after the barrier to entry was lifted?

1. The judgment represents the views of all three members of the Appeal Tribunal, constituted by statute for their diverse specialist experience in employment relations. However, in places this judgment is given in the first person singular since it relates to a number of judgments I have given sitting alone in this litigation, and in authorities relevant to it. The judgment overall remains that of the three of us.

1. It is an appeal by nine sample Claimants in proceedings before an Employment Tribunal sitting at Leeds under the chairmanship of Employment Judge Hepworth over ten days for which a reserved judgment and reasons were given on 9 December 2009. The parties were represented respectively by Mr Paul Draycott and Mr Brochwicz-Lewinski of counsel. Of 15 or 16 sample Claimants, eight succeeded in part and six failed entirely. Nine sample Appellants, whose cases are live before us, include women from both groups.

1. The litigation is part of very substantial legal activity conducted in various regions of the Employment Tribunals against the three Respondents in these proceedings. There have been many amendments to the original claims and several appeals from orders of the Employment Tribunals, in which I have given judgment. Although this had caused very substantial delay in the adjudication of the claims, some of which date back to 13 December 1994, the judgment of the Leeds Tribunal represents the fullest consideration of the evidence necessary to test the legal point in the litigation. The Tribunal made clear findings as to the intention of each of the Claimants in respect of joining the pension scheme when it was closed to her, and later when it was open to her to do so. There is no appeal by either side against the factual determinations in each case.

1. The Tribunal introduced the Respondents in the following way;

"The Tribunal found that at the time to which the claims relate the Respondent was a very large company having many sites in Liverpool, Bolton, Preston, Glasgow and retail shops in towns and cities. Its business involved the famous Littlewoods Pools organisation, a large mail order business and the retail shops. The businesses were then owned by the Moores family in Liverpool. Many thousands of employees were employed and there are many hundreds of Claimants whose entitlement to a declaration of retrospective entry in the Respondent's occupational pension scheme depend on the conclusions of the Hearing."

1. The Claimants were employed in various positions, principally in occupations where they were described as "graded employees", as opposed to the supervisory and management positions of "zoned employees". Their dates of employment begin as long ago as 1968. For the purposes of legal proceedings, 8 April 1976 is the relevant start date, for this is when the judgment of the ECJ in Defrenne v Sabena [1976] ECR 1-455 took effect. The availability of a pension scheme to employees of the Respondents changed at different stages and the relevant periods are as follow:

(1) 8 April 1976 to 1 January 1977: membership of the scheme was compulsory for supervisors and voluntary for others, but part-time staff were excluded.

(2) 1 January 1977 to 6 April 1988: membership of the scheme was made compulsory for new entrants in the zoned categories; part-timers were excluded. It was closed to graded employees but those already in the scheme were entitled to remain and to continue contributing. In effect, it became a "top hat" scheme available only to managers.

(3) 6 April 1988 when section 15 of the Social Security Act 1986 came into effect to 1 June 1988: This rendered void any term within an occupational pension scheme which made membership of the scheme compulsory. The Respondents' scheme, therefore, was voluntary by law.

(4) 1 June 1988: membership of the scheme was made available on a voluntary basis to all zoned and graded staff, but not to part-timers.

(5) 1 April 1990 to 1 July 1995: eligibility for the scheme was opened up in stages to part-timers, first to those working 22.5 hours, then 15 hours, then 12 hours a week and finally to all on 1 July 1995.

1. The conditions are simplified because there were other eligibility criteria, but a broad statement of the exclusion of part-timers fits the above chronology. The maximum extent of the exclusion would be illustrated by a Claimant who worked fewer than 12 hours a week from 8 April 1976 for she would be excluded from the first period, she would not be eligible to be treated as staying within the scheme during the second period, and from 1 June 1988 to 1 June 1995 she would also be excluded. We will describe as the closed period those times when any Claimant was excluded from access to the scheme, and the open period when there was no barrier based on part-time working to such access.

1. This case concerns a group of women who are known as "the opters". During the closed period, the Claimants would have opted not to join even if the scheme were open to them. Evidence as to their state of mind during the closed period was available from their recollections and contemporary records, and was informed by their conduct during the open period. Taking a pragmatic approach, the Respondents did not challenge those employees who joined the scheme when it was opened to them, or for three months thereafter. Where there was a substantial delay, the Respondents' position was that this indicated the Claimant would not have joined during the closed period and, therefore, denied each of those claims.

1. By the time of the hearing it was common ground that the exclusion of part-timers during the closed period had a disproportionate impact on women and the Respondents did not seek to justify it. Pensions are a form of pay regulated by the Equal Pay Act 1970 and by what was then Article 141 of the TEC and is now Article 157 TFEU. An occupational pension scheme must be open equally to men and women.

1. It was at one stage in the appeal argued that the method of testing the intention of the Claimants by reference to their conduct during the open period was unlawful. This appears no longer to be an issue. Mr Lewinski's argument began in writing with dealing with the principle as to the level of evidence required for the Claimants' intentions. But this does not seem to have been advanced by Mr Draycott. The central question is to determine whether the Claimants would have joined during the closed period and evidence as to what they did during the open period is relevant to determining that state of mind. That is necessary for determination of whether there has been loss. We see nothing wrong with the Tribunal examining the evidence as to what the Claimants did during the open period when forming a view on the central question of what they would have done during the closed period.

1. Similarly, Mr Lewinski contended that this case was not about indirect discrimination. With respect that point cannot be made in the light of the issues recorded by the Tribunal as not being in dispute viz the scheme was "indirectly discriminatory against female employees, as having a disproportionate effect upon them as females". The Respondents' letter on 27 February 2004: "the Respondent concedes the disproportionate impact point" itself followed the concession given in the set piece litigation Preston & Ors v Wolverhampton NHS Trust (No. 3) [2002] (Regional Employment Chairman Mr J McMullen). A rule which is facially neutral but which has a disproportionate impact on women is indirectly discriminatory unless justified. The point about the original Preston litigation was that claims had to be raised under the Treaty because the Equal Pay Act provided no relief or no breach in respect of a discriminatory rule such as the above.

1. Each of the Claimants produced evidence in which she sought to show that she would have joined the scheme during the closed period. This was without prejudice to the contention now made that she was not obliged to do so and that the simple existence of the rule entitled her to the remedy of the declaration which she sought. In some cases their evidence was accepted and a declaration given from which there is no appeal by the Respondents.

1. Our approach to the legislation can be divided into two parts. This is because the Claimants contend that a different approach should be taken in the light of amending legislation in the UK and in Europe from 2002 to 2010. This is resisted by the Respondents. Dealing first with the uncontroversial first period, I set out the statutory provisions in Preston No. 3 as follows:

"14. The Community right to equal pay is provided by Article 141 (ex Article 119) as follows:

'(1) Each Member State shall ensure that the principle of equal pay for male and female workers for equal or work of equal value is applied.

(2) For the purpose of this Article, "pay" means the ordinary basic or minimum wage or salary and any other consideration, whether in cash or in kind, which the worker receives directly or indirectly, in respect of his employment, from his employer.'

15. The Equal Pay Act 1970 was replaced in amended form before its implementation on 29 December 1975 as a schedule to the Sex Discrimination Act 1975. It provides for an equality clause where men and women do equal work (that is like work, work which is equally rated or work of equal value):

'1. Requirement of equal treatment for men and women in same employment

(1) If the terms of a contract under which a woman 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.

(2) An equality clause is a provision which relates to terms (whether concerned with pay or not) of a contract under which a woman is employed (the "woman's contract"), and has the effect that –

(a) where the woman is employed on like work with a man in the same employment –

(i) if (apart from the equality clause) any term of the woman's contract is or becomes less favourable to the woman than a term of a similar kind in the contract under which that man is employed, that term of the woman'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 woman's contract does not include a term corresponding to a term benefiting that man included in the contract under which he is employed, the woman's contract shall be treated as including such a term;

(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.'

16. Until it was modified with effect from 19 July 2003, the Act contained two constraints on the effectiveness of its provisions. Section 2(4) provided that no claim could be presented if the employee 'has not been employed in the employment within the six months preceding the date of the reference'. And s2(5) imposed a limit on the recovery of back pay, or a declaration relating to access to a pension scheme, to two years preceding the making of the claim.

17. From 6 April 1978 until 1988 (Social Security Act 1986 s15), the Equal Pay Act was modified by reg. 10 of the Occupational Pension Schemes (Equal Access to Membership) Regulations 1976 (SI 142 1976 made under s53 Social Security Pensions Act 1975). This regulation provided that references in the Act to 'less favourable terms of a contract' were to be read (so far as relevant) as referring to 'terms (or terms and conditions) which enable persons to have access to membership of a scheme … on a voluntary (as compared with an obligatory) basis'. A transitional scheme was permitted whereby persons who were employed but who were not members of a pension scheme as of 5 April 1978 could continue to be afforded membership on a voluntary basis (reg. 10(3) and (4)).

18. The precise terms of s53 are as follows:

'53(1) The provisions of ss54 to 56 below shall have effect with a view to securing that the rules of occupational pension schemes conform with the equal access requirements.

(2) Subject to subsection (3) below, the equal access requirements in relation to a scheme are that membership of the scheme is open to both men and women on terms which are the same as to the age and length of service needed for becoming a member and as to whether membership is voluntary or obligatory'.

19. Regulation 10, which has the cross-heading 'Modification in relation to the equal access requirements of the provisions of the Equal Pay Act as to equality clauses', provides, so far as material:

'(1) .. the Equal Pay Act shall be so modified, in its application to the equal access requirements, as to have effect as if there were substituted, for references to less favourable terms of a contract and less favourable terms and conditions of employment, references to

(a) terms …which do not enable persons to have access to membership of a scheme (as compared with terms … which do enable persons to have such access) and

(b) terms .. which enable persons to have access to membership of a scheme at a higher age or … lower maximum age, after a greater length of service or on a voluntary (as compared with an obligatory) basis.'

20. The 'equal access requirements' did not apply in certain transitional circumstances for reg. 9 contained special provisions for membership of a scheme to be or remain voluntary. The Regulations were made on 3 February 1976 and came into operation on 6 April 1978, preserving the foregoing right in respect of persons who were employed in relevant employment up to that date.

21. Where there is a breach of the equal access requirements, powers are given to an employment tribunal by reg. 12, which provides as follows:

'12(1) The Equal Pay Act shall be so modified as to provide that where a court or an industrial tribunal finds that there has been a breach of a term in a contract of employment which has been included in a contract, or modified, by virtue of an equality clause and which relates to membership of a scheme, or where it makes an order declaring the right of an employee to admission to membership of a scheme in pursuance of the equal access requirements, it may declare that the employee has a right to be admitted to the scheme in question with effect from such date ("the deemed entry date") as it may specify, not being earlier than whichever is the later of the following dates, namely –

(a) 6 April 1978; and

(b) the date two years before the institution of the proceedings in which the order was made.

(2) The Equal Pay Act shall be so modified as to require that if the deemed entry date is earlier than the date of the declaration, the employer shall provide any such resources as are specified in para (3) below.'

22. By reg. 13, an employer found to be in breach of the equal access requirements may be ordered to make additional resources available so that the obligation may be met.

23. Public policy in relation to occupational pension schemes changed and was embodied in the Social Security Act 1986, as follows:

'15(1) Subject to any such exceptions as may be prescribed –

(a) any term of a contract of service (whenever made) or any rule of a personal or occupational pension scheme to the effect that an employed earner must be a member of a personal or occupational pension scheme, of a particular personal or occupational pension scheme or of one or other of a number of particular personal or occupational pension schemes shall be void; and

(b) any such term or rule to the effect that contributions shall be paid by or in respect of an employed earner to a particular personal or occupational pension scheme of which the earner is not a member, or to one or other of a number of personal or occupational pension schemes of none of which he is a member, shall be unenforceable for so long as he is not a member of the scheme or any of the schemes.'

The Pension Schemes Act 1993 s160(1) continued that policy.

24. The 1976 Regulations continued in force until they were replaced by the 1995 Equal Treatment Regulations, with effect from 1 January 1996. Hence the 1976 Regulations can be relied upon in these proceedings, which were, in the main, commenced in 1994. Under powers given by the Pensions Act 1995, further Regulations were made modifying the Equal Pay Act where an employee claimed the equality clause was connected to pension rights. Regulation 9 of the Occupational Pension Schemes (Equal Treatment) Regulations 1995 provides that s2(5) of the Equal Pay Act does not apply and damages could not be awarded. Instead, reg. 10 inserts s2(6D) into the Equal Pay Act which provides as follows:

'(6D) Where a court or employment tribunal finds that there has been a breach of an equality clause which relates to the terms on which persons become members of the scheme –

(a) the court or tribunal may declare that a person has a right to be admitted to the scheme in question with effect from such date ("the deemed entry date") as it may specify provided that such date may not be earlier than two years before the institution of the proceedings in which the order was made, and

(b) when the court or tribunal so declares and the deemed entry date is earlier than the date of the declaration, the employer shall provide any such resources to the scheme as are specified in subsection (7D) below.'

25. It will be seen that that provision replicates the two-year backdating limitation contained in s2(5) of the Equal Pay Act for ordinary claims of breach of the equality clause. Further temporal limitation is imposed by reg. 11, restricting backdating of any declaration to 17 May 1990 which was the date of the judgment of the European Court of Justice in Barber v Guardian Royal Exchange Assurance Group [1990] IRLR 240 ECJ.

26. Although not directly relevant for these proceedings, the Sex Discrimination Act 1975 has been alluded to for its concepts of direct and indirect discrimination and 'detriment'. In its form relevant to these proceedings, which were commenced before 12 October 2001, ss1 and 6(2) provides as follows:

'1. Direct and indirect discrimination against women

(1) In any circumstances relevant for the purposes of any provision of this Act, other than a provision to which subsection (2) applies, a person discriminates against a woman if -

(a) on the ground of her sex he treats her less favourably than he treats or would treat a man, or

(b) he applies to her a requirement or condition which he applies or would apply equally to a man but –

(i) which is such that the proportion of women who can comply with it is considerably smaller than the proportion of men who can comply with it, and

(ii) which he cannot show to be justifiable irrespective of the sex of the person to whom it is applied, and

(iii) which is to her detriment because she cannot comply with it.

6. Discrimination against applicants and employees

(2) It is unlawful for a person, in the case of a woman employed by him at an establishment in Great Britain, to discriminate against her –

(a) in the way he affords her access to opportunities for promotion, transfer or training, or to any other benefits, facilities or services, or by refusing or deliberately omitting to afford her access to them;

(b) by dismissing her, or subjecting her to any other detriment.'"

1. The origin of the "opters" category is the judgment of Employment Judge Macmillan, and the most accessible route to depicting this is provided by Elias P in Dennison v The University College of St Mark and St John & Ors [2006] UKEAT/0196/06. In that case the Employment Judge had erred in failing to consider the reasons why the Claimant had not joined the relevant scheme when it was open to her to do so, in order to answer the "fundamental question" as to whether or not she would have joined during the closed period. The President said this:

"Miss Morris before us conceded that the claim could in fact only run from when her employment commenced to the point when she was given the right to join the scheme which was from 1 April 1987. Thereafter, she would not of course have been treated differently to any of the full-time employees."

1. Although it might be suggested that this claim was based on a concession, it is plain that the President considered the concession was well made. He said this:

"8. Both parties submitted that the Appellant's case is to be considered under the principles established in the case of Preston v Wolverhampton Healthcare NHS Trust (No. 3) [2004] IRLR 96, although in fact that case did not determine the point in issue in this case. The Judgment in that case was given HHJ McMullen. He set out at the beginning of that Judgment an admirably concise statement of the principal features of the law in relation to access to pension benefits. The essential feature is that the right of access to a pension scheme of this kind falls under the terms of Article 141 of the Treaty of the European Union (formerly Article 119 of the Treaty of Rome). That was established in a number of decisions of the European Court of Justice, including Bilka-Kaufhaus GmbH v Weber von Hartz [1986] IRLR 317 and Vroege v NCIV Instituut voor Volkshuisvesting BV [1994] IRLR 651.

10. The Chairman subsequently provided certain guidance for those concerned with these part-time pension cases, which has in fact proved extremely valuable to employment tribunals. One of the paragraphs of the information bulletin No. 9 is highly pertinent to this decision, paragraph 7.2 which is as follows:

'7.2 Membership for full time employees not compulsory – part-timers excluded

Your claim will not succeed in respect of this period of time if you do not join the scheme when the rules later changed to allow you to do so or you only did so after significant delay. This is because your failure to join the scheme when you were allowed to, suggests that had you been a full-timer you would not have joined the scheme during this earlier period of time anyway and therefore you have lost nothing. However, there is an exception for applicants who can satisfy a tribunal that they would have joined during the earlier period had they been eligible. This is to allow for special cases such as those where by the time the rules were changed to enable part-timers to join, an applicant was so near to retirement that joining was pointless, or she had already taken out a private pension plan.'

15. Plainly, an employee has no complaint if she would not have joined the scheme even if eligible to do so. The fact that when she becomes eligible she does not join will be powerful and often very powerful evidence from which a Tribunal will readily draw the inference that she would not have joined even had she been notified of her eligibility at an earlier stage. But it is not necessarily conclusive and the tribunal must always focus on the crucial question whether she would have joined the scheme at the earlier stage or not. There may be explanations as to why she did not join later but would nonetheless have joined earlier. Paragraph 7.2 recognises that this is a clear possibility. A potential special case which identified in paragraphs 7.2 is where she has taken out a private pension and it may have been more sensible for one reason or another to maintain that arrangement in place rather than to go into the employer's scheme. But there may be other explanations, good or bad, as to why she did not join when she became eligible to her knowledge and yet will still be able to establish that she would have joined at an earlier date.

21. We have come to the conclusion that the Appellant's contention is correct and that the Tribunal did err in its approach in this case.

22. But we accept that the Tribunal here should have focused on the fundamental question whether the employee would have joined the scheme at the earlier stage, had she thought that she was eligible to do so. There was in this case evidence which the Tribunal could properly consider would be material to that issue, namely the fact that she had made enquiries and she had indeed taken out her own private pension arrangements.

23. Looking at this Tribunal decision, we do not think that the Tribunal did focus on that key question and assess the significance of the evidence when taken as a whole. Had they done so, they might have reached a different conclusion. We are not prepared to say, as Miss Morris urges upon us, that they would inevitably have taken the view that she would have joined at the earlier stage. We are not confident that that was the only inevitable result that they could reach on the evidence before them, but we do accept that they need to focus on that issue and we are not satisfied that they did in this case."

1. With respect, it is not clear to us whether the President regarded examination of the evidence relating to the Claimant's intention as fundamental to her establishment of a breach of the equality clause, or of a remedy for such a breach. Employment Judge Macmillan's primary holding was that there was no breach because there was no detriment and no loss. But his alternative holding was there would be no declaration in respect of any given opter as she suffered no detriment, no loss, no disadvantage. It was essentially a matter of remedy.

1. This latter approach was expressly adopted in Lavety v (1) Lanarkshire Health Board (2) Scottish Ministers [2008] UKEATS/0033/08. Lady Smith held an Employment Judge had erred in failing to focus on the key or fundamental question which was to determine whether a claimant would have joined the pension scheme during the closed period. She summarised, under the heading of Relevant Law, the situation as follows:

"12. The claimant's claim is made under the Equal Pay Act 1970. She asserts that she received unequal treatment during the period that she was excluded from access to the NHS Scheme on the ground that she was a part-time worker. The right of access asserted falls under Article 141 of the Treaty of the European Union: Bilka–Kaufhaus GmbH v Weber von Hartz [1986] IRLR 317; Vroege v NCIV Instituut voor Volkshuisvesting BV [1994] IRLR 651. As a claim under the Equal Pay Act, the relevant right is a right to rely on the term of the contract of employment implied by section 1 of the Act, namely an implied equality right. In the case of access to a pension scheme, that amounts to the right of female part-timers not to be excluded from a pension scheme because of their particular part-time status. An employer is in breach of the implied equality right where pension scheme membership is compulsory for full-time staff but part-time staff are excluded. The employer is not, however, in breach, if membership is compulsory for full-time employees and optional for part-time staff (see: Preston v Wolverhampton Healthcare NHS Trust (No 3) 2004 IRLR 96). Accordingly, in the case of this claimant, the right to have access to the Scottish NHS Pension Scheme was implied into the contract of employment she entered into on 1 September 1983. Membership of the Scheme did not require to be compulsory for part-timers but the claimant ought to have been entitled to join it as from that date.

13. When it comes to remedy it is, accordingly, necessary to look at the question of whether a part-time worker who has been excluded from a pension scheme would, on a balance of probabilities, have joined the Scheme during the period of her exclusion from it if she had been eligible to do so. That that is the fundamental question was confirmed by the President (Elias J) in Dennison v The University College of St Mark and St John & Others UKEAT/0196/06."

1. It is plain there that Lady Smith was regarding the matter as one going to remedy and her conclusion was as follows:

"29. I am satisfied that the Tribunal fell into error. Despite referring to Dennison it appears to have fallen into the same error as the Tribunal in that case in that it failed to focus on whether or not the claimant could establish that had she been afforded access to the NHS pension Scheme when she should have been, she would, on a balance of probabilities, have joined it. Her case was: when she was interviewed in 1983, she asked whether she would be able to join the scheme. She would, as the Tribunal appears to have accepted, have joined the scheme at that stage had she been allowed to do so. Within three years of commencing employment, not being able to join the NHS Scheme, she had taken out a private pension policy. By January 1991, she had taken out three such policies and was paying a significant sum into them each month. She understood, however, that the NHS Scheme was a better pension scheme than her private policies. She could not afford both to pay into her private policies and to take up her entitlement to join the NHS Scheme when she first got to know about it. If she had ceased making her private policy payments, she would have suffered a penalty on that investment. When she could afford to pay into both the NHS Scheme and her private policies, she opted into the former. This was not, accordingly, a case of a woman who would not have bothered about securing a pension for herself; nor is it a case of a woman who was opposed in principle to joining her employers' pension scheme. It is hard to see what more would be required to persuade a Tribunal that she would have joined the Scottish NHS Pension Scheme in September 1983 had she not been denied the opportunity to do so on account of her part-time status. I can only think that the Tribunal here has focussed unduly on the fact of the delay between eligibility and joining in 1996, overlooking the need to ask what would have happened at the earlier stage."

1. Submissions were made to us based upon In re Hetherington [1991] Ch 1 to the effect that the EAT was proceeding simply upon an assumption rather than a finding. We have no doubt the President was operating on the basis of a conclusion of law he made that the opter point was live and relevant before him and that the law had been correctly stated by Employment Judge Macmillan. We reject the contention that in Dennison, the President was simply applying without deciding the principle. The doctrine in Hetherington is of no relevance to this holding which indicates the President's mind was firmly focused on what he described as the fundamental issue. He is not a judge to accept something without applying his mind fully to the correctness of it. We reject the contention that the point was not live before the EAT in Dennison and Lavety.

1. The remedy for a breach of an equality clause in relation to pay is an award of arrears of remuneration and probably a declaration: see Sorbie (para 65 below). For non-pay matters it is damages. As I explained in Preston No.3 at paragraph 24 (above) since the amendments to the Equal Pay Act introduced by the 1995 Regulations, damages or arrears of remuneration must not be awarded in pension cases. The sole remedy for a breach of the equality clause in relation to occupational pensions is a declaration, paying attention to the entry date where there is a further discretion, and an order that the employer provide funding to the scheme. New Regulations took effect on 1 January 1996, after the Respondents' scheme was open to all. So this case is regulated by the 1976 Regulations which did not specifically preclude an award of arrears of remuneration or damages, as the 1995 Regulations do. Nevertheless it is clear that the modification to the Equal Pay Act for pension cases so as to provide only a discretionary declaration means that an award of arrears of remuneration or damages is not available. It is arguable that such an award under the unmodified Act in the non-pension cases was not discretionary but contractual. Such argument is irrelevant to the present appeal. Besides, under the Equality Act 2010 ss 132-133 all remedies for breach of an equality clause or an equality rule are discretionary. The 1976 Regulations took effect on 6 April 1978 but no separate argument has been addressed to us as to the remedy available to any Appellant in that period. The discretionary declaration itself has not been challenged in this or any decided case, but the Claimants here would argue that if a breach of Art 141 is found, EU law would make it mandatory.

1. The reference in the above regulations to whether a scheme is voluntary or obligatory is to a scheme which provides differential access, i.e. making it voluntary or obligatory for different classes of employees. As such, they are of no assistance where a scheme is voluntary for all classes of employees. It is common ground that Preston concerned as a matter of fact employees who, since the Social Security Act 1986 came into effect in 1988, could not be obliged to join a scheme. In the lead case of Vroege v NCIV Instituut voor Volkshuisvesting BV [1994] IRLR 651 it is common ground before us that the scheme was obligatory for all. In short, whether the scheme is obligatory or voluntary, access must be afforded equally to men and women. It is also common ground that the issue of the opters was not before me in Preston No. 3. It had been raised expressly before Employment Judge Macmillan but was not pursued on appeal. It is true to say, as Mr Draycott points out, that I made a number of observations which would support his proposition that it was not necessary to consider the individual circumstances, but I expressly eschewed making such a judgment since the issue was not live before me.

1. Employment Judge Macmillan does deal with the issue of remedy and says this:

"146. I do not accept Mr Cavanagh's interpretation of the compensatory provisions of the Equal Pay Act. Indeed, apart from section 2(5), which limits the award of compensation to the two year period immediately preceding the commencement of proceedings, there is nothing in the Act which touches upon how compensation is to be calculated, from which I can only conclude that, the cause of action being a breach of the equality clause implied into the contract of employment by section 1(1), the normal rules with regard to the assessment of damages for breach of contract apply. That would include, as Miss McNeil concedes, the possibility of an award of purely nominal damages. It is clear from Regulations 12(2) and (3) that once a declaration is made the employer is required to pay into the pension scheme the resources necessary to fund the applicant's pension which suggests that, if Mr Cavanagh is right, it would not be possible to make the declaratory equivalent of an award of nominal damages."

1. It seems to us the Employment Judge was there reflecting on the normal rule in contract. A breach gives rise to a remedy, which is damages. If there is no loss, or the Claimant cannot prove a loss, nominal damages would be awarded. Employment Judge Macmillan was plainly correct in respect of the period prior to 1978 where damages was a remedy for breach of the equality clause and there was no mention of the equal access requirements. After that, Parliament seems to have constructed a different approach to the question of a breach of contract. The equality clause is broken by unequal access to a pension scheme; the breach is not remedied by arrears of pay or damages whether nominal or substantial. Nor is the remedy automatic, it is discretionary, as all declarations are. If the declaration is given, there is also a further discretion as to the entry date. Then the Tribunal must make an order upon the employer for funding of the pension to the extent necessary as a result of the declaration. Whether that is sufficient discharge of the UK's obligations under the Treaty is an issue in this appeal.

1. It must be noted that the provisions of the Equal Pay Act relating to less favourable treatment of a woman in terms of her contract are not applied in respect of equal access to pensions. Her cause of complaint arises where "terms … which do not enable persons to have access to membership of a scheme (as compared with terms … which do enable persons to have such access) apply" **(Regulation 10). The term in the instant scheme precluding part-timers from membership is precisely that.

1. Consideration of the personal circumstances of any given employee is irrelevant when the scheme is compulsory. By that we mean that the employees of any given class must join it. If there are exceptions to that requirement, e.g. part-timers, and that exception is found to be discriminatory, all excluded employees suffer a loss. Full-timers have the obvious advantage that while they pay contributions the employer pays more and contributes by way of deferred pay to an enhanced pension entitlement. It appears to us that the issue in the present case has not arisen for decision before the ECJ. Employment Judge Macmillan created the opters test and it has been applied uncritically in Dennison and Lavety.

1. Mr Draycott's principal submission is that the requirement that a woman justify her claim to retroactive access by evidence is an additional requirement not imposed and not allowed by the European Court of Justice authorities. In this case the Respondents accept that in the closed periods (between 8 April and 31 December 1976 and 1 June 1988 until the removal in each case of the exclusion by 1 June 1995) in contrast to their full-time colleagues, the Claimants' terms prevented them from joining the pension scheme by reason of their part-time hours; it had disparate impact on women; and it was not justified. In these circumstances Mr Draycott contends that the essential criteria for European law are satisfied, as set out in Bilka-Kaufhaus GmbH v Weber von Hartz [1987] ICR 110 ECJ, in which it was held:

"24. In the first of its questions the national court asks whether a staff policy pursued by a department store company excluding part-time employees from an occupational pension scheme constitutes discrimination contrary to article 119 where that exclusion affects a far greater number of women than men.

25. In order to reply to that question reference must be made to the judgment of 31 March 1981 in Jenkins –v- Kingsgate (Clothing Productions) Ltd (case 96/80) [1981] IRLR 228.

26. In that judgment the Court considered the question whether the payment of a lower hourly rate for part-time work than full-time work was compatible with Article [141].

27. Such a practice is comparable to that at issue before the national court in this case: Bilka does not pay different hourly rates to part-time and full-time workers, but it grants only full time workers an occupational pension. Since, as was stated above, such a pension falls within the concept of pay for the purposes of the second paragraph of Article 119 it follows that, hour for hour, the total remuneration paid by Bilka to full time workers is higher than that paid to part-time workers.

28. The conclusion reached by the Court in its judgment of 31 March 1981 is therefore equally valid in the context of this case.

29. If, therefore, it should be found that a much lower proportion of women than of men work full time, the exclusion of part-time workers from the occupational pensions scheme would be contrary to Article 119 of the Treaty where, taking into account the difficulties encountered by women workers in working full time, that measure could not be explained by factors which exclude any discrimination on grounds of sex.

30. However if the undertaking is able to show that its pay practice may be explained by objectively justified factors unrelated to any discrimination on grounds of sex there is no breach of Article 119.

31. The answer to the first question referred by the national court must therefore be that Article 119 of the EEC Treaty is infringed by a department store company which excludes part time employees from its occupational pension scheme, where that exclusion affects a far greater number of women than men, unless the undertaking shows that the exclusion is based on objectively justified factors unrelated to any discrimination on grounds of sex."

1. Mr Draycott contends without opposition that these criteria have been affirmed in the following authorities: Vroege [1995] ICR 635 at 660, Helmig [1996] ICR 35 at 22-25, 49, Schroder [2000] IRLR 353 at 357, Preston [2000] ICR 961 at 992 and Schonheit [2004] IRLR 983 at 990. In the light of those authorities it is contended that the only permissible option was for the Employment Tribunal to conclude that the equality clause had been breached and the declaration must be made. This is based on the proposition that Employment Judge Macmillan in Preston had erred in having regard to concepts such as less favourable treatment and detriment in considering whether or not the equality clause had been breached, for these do not arise under the ECJ jurisprudence.

1. On behalf of the Respondents, Mr Lewinski contends that Employment Judge Macmillan is correct in adducing the opters test. None of the European Court authorities deals expressly with this issue and yet it is correct by reference to both established domestic legal principles and principles embodied in the Treaty.

1. It is common ground that Barber v GRE [1990] ICR 616 and Vroege (above) were about pension schemes to which the employer was required to provide access and which the employee was obliged to join. It follows that failure to allow access to an employee to the pension scheme was a detriment. It represents a diminution in pay. So it is not surprising that the stream of cases before the European Court of Justice involves claimants who have been deprived of access to a scheme which is of valuable benefit to them. But for the fact that they were part-time workers, they would have been required to join the scheme and the employer required to take them in. It appears to us that this was the case in Schroder, Schönheit, Helmig, Fisscher[1995] ICR 635, Bilka, Preston and National Pensions Office v Jonkman [2007] 3 CMLR 25/653 ECJ

1. The principal question in this appeal is whether it applies to a voluntary scheme: does the Claimant have to show she suffered a loss or is it sufficient that there was a breach of the right of all employees to join the scheme? At first sight, none of these cases is of assistance where the scheme, as here, is voluntary for all employees, but access is denied to part-timers. In the Preston suite of litigation the opters point was not live before the EAT. Other points in Preston were taken at the EAT and one was taken to the House of Lords, the electricity supply cases known as Powerhouse Retail Ltd v Burroughs [2006] IRLR 381 HL.

1. To this extent only, Mr Draycott is correct: in our view, Bilka requires no more than the establishment of discriminatory terms relating to access to the pension scheme. The employee is entitled to complain that a term in her contract, as compared with the term in the contract of a comparable male employee, precludes her from membership of the scheme but allows him access to it. That fits precisely the terms of the 1976 and 1995 Regulations. In the English common law of contract, having established a breach she is entitled to damages or at least some remedy. It is plain from the passage we have cited above from Employment Judge Macmillan that if a contractual approach is taken, damages will be awarded but they may be nominal. In this statutory jurisdiction prior to the 1976 Regulations coming into effect in 1978, damages were available, together with a declaration. After the 1976 and 1995 changes, damages are not available - simply a declaration which is discretionary.

1. Mr Lewinski submits that in the case of the historic exclusion from a non-compulsory pension scheme, an employee has no right to claim retrospective membership if on the evidence she would never have joined the scheme during the closed period. In other words, in order to establish a right to valuable reparation she must prove a breach and loss. A remedy is not awarded where detriment has not been suffered.

1. In our view, this case stands at the intersection of two important principles. A claimant is entitled to vindicate her right to a contract which does not include discriminatory terms which preclude her from access to a scheme, on the one hand; and on the other, the law will not assist her with a remedy where she has suffered no loss. This begins with Article 2 of the Equal Pay Directive 75/117/EEC which provides as follows:

"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 principles of equal pay to pursue their claim by judicial process…"

1. That principle is reiterated in Article 17(1) of the Recast Equal Treatment Directive 2006/54/EC and Article 18 of the same directive ("loss and damage sustained by a person injured as a result of discrimination on grounds of sex"). Neither the law of the European Union nor English common law operates in a vacuum. It is not necessary to establish a breach of contract that there be loss, which relates to remedy. Similarly, in European law a breach may exist but the principle of protection applies only to those who consider themselves wronged, that is, to have suffered some detriment or loss.

1. It was never suggested in the Preston litigation that the remedy of a declaration under the Equal Pay Act and the Pension Regulations offended the European Union principles. In English law that is a remedy for breach of contract. In any event, under the domestic statutory regime it is the sole remedy (linked to an order requiring the employer to fund the pension scheme) in respect of a breach of the modified Equal Pay Act taking the form of unequal access to an occupational pension scheme. It remains a two-stage approach. The Tribunal has to find a breach of the equality clause. It may make a declaration and if it does it will order the employer to fund the scheme.

1. The purpose of the discretion given to the Tribunal is to acknowledge events such as the present. Where there has been no loss it would not be correct to order reparation. The Claimant's case that her equal rights have been abused can be vindicated by finding that there has been a breach but there is not to be a mandatory order for damages or any other specific relief. In contract, where there is a breach the court is required to put the Claimant in the position as though there had been no breach. The breach is a failure to offer access to the scheme, but she would never have joined the scheme. Turning the clock back to the time to establish that there was no unlawful action against her would mean that she would still decline to be a member of the scheme and, therefore, suffer no loss.

1. Counsel in the appeal did not argue any analogue with other legislation, and we do not rely upon it for our decision that a breach occurs simply by the existence of a discriminatory term, but there are parallels with the protection of part-time workers and fixed-term workers. Under the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 the part-time worker has two separate rights: not to be treated less favourably as regards the terms of their contract and not to be subject to detriment (Regulation 5(1)). A similar provision occurs in the Fixed-term Employees (Prevention of Less Favourable Treatment) Regulations 2002 in Regulation 3. The remedy under the former is that the Tribunal must grant a declaration if it is just and equitable to do so, and order compensation to be paid. Thus the remedy remains discretionary; the Tribunal must consider taking the step of granting a declaration. It will do so only if it is just and equitable. It is also worth noting that by Regulation 8:

"For the purposes of calculating the date of the less favourable treatment or detriment …

(a) Where a term in the contract is less favourable, that treatment shall be treated … as taking place on each day of the period during which the term is less favourable."

The remedy tracks in time the duration of the unfavourable term in the contract.

1. A second analogue is the Equal Pay Act 1970 itself, which, when originally enacted, contained section 3. This enabled a trade union to present a claim where a collective agreement or pay structure contained terms which were discriminatory. In those days it was not uncommon to find a structure providing separately for men and women expressly. In due course, interpretation of that section provided for its application to implicit discrimination. The relevant judicial body, the Central Arbitration Committee, had power to make a monetary award. This section was short-lived - repealed in 1980. But s. 2(2) survives, enabling the Secretary of State to refer a contravention of an equality clause to the Employment Tribunal.

1. The above analogues reflects the common law which is that where a breach of contract entitles the Claimant to complain, she seeks reparation to restore her to the position she would have been in had there not been a breach. Had the 2000 Part-time Regulations been in place and available to the Claimants, their task would have been simpler. They applied under Article 141 of the Treaty because at the time access via indirect discrimination was not available to them under the Equal Pay Act. Their claims might more expeditiously be handled under the 2000 Regulations. But in either case the substance is the same. The contract of a full-timer includes a right of access to the pension scheme which is denied to a part-timer. The fact that this disproportionately affects women makes the claim exigible also under Equal Pay Act section 1(2)(a)(ii) as amended to include direct and indirect application.

1. It follows that the observations I made in Preston No. 3, which did not decide the point in the present case, may be relevant to it and are relied upon by Mr Draycott:

"47. It is important to note in our case the following:

(a) It is conceded that the applicants were excluded because they were part timers

(b) This has a disparate impact on women

(c) Justification is not advanced

(d) The relevant scheme is contributory, whereas if it were non-contributory there can be no question but that it constituted less favourable treatment.

48. It seems to me that in those four cases before the Luxembourg Court (including Barber) the court was prepared to conclude that, subject to justification, mere exclusion from an occupational pension scheme was a breach of Article 141. It was not suggested that further examination of any particular candidate's personal circumstances was required. In other words it is less favourable treatment to exclude a person from a pension scheme…

49. ..For the purpose of the debate in this case, it is assumed in the electricity supply industry that, broadly speaking, employers pay substantially more than employees by way of contributions to the scheme. Where that kind of relationship exists, it seems to me that the European Court did not require a national court to weigh the relative burden and benefit to any given employee, nor did it require an individuated assessment of their choice…it seems to me therefore that the answer to Mr Jean's submissions is found in those European Court judgments.

50. It is of course true that the applicant has to succeed by way of Article 141, because in domestic law at the relevant time she could not complain of indirect discrimination, and she was precluded by the two-year limit on backdating from obtaining any relief in domestic law. I accept at once that the essence of Article 141 is to outlaw 'less favourable treatment'..

52. Mr Jeans argued that less favourable treatment means the same as a detriment … Mr Jeans relied on Shamoon –v- Chief Constable of the RUC [2003] IRLR 285 HL.

53. Those cases are all brought under either the Sex Discrimination Act/Order or the Race Relations Act and involve consideration of 'detriment' as well as 'less favourable treatment'. I accept Mr Cavanagh's submission that, authoritative as they are, they do not assist in examining whether or not there has been a breach of contract, ie a breach of the equality clause. As he put it, the central question is whether there has been a breach of the clause, resulting in less favourable treatment, not whether the applicant considers there to have been less favourable treatment. When examining whether there has been a breach of contract, the result cannot be different for the group of workers affected by the Electricity test cases according to their personal circumstances and imputed intentions looked at retrospectively. In so far as the speeches in Shamoon are instructive on this issue, they point to an objective rather than a subjective approach to the resolution of this issue. Both Lord Scott and Lord Hope expressly refer to what is 'reasonable' and the references in Barclays Bank Plc –v- Kapur .. to 'unjustified' by the Court of Appeal also injects objectivity into the discussion.

54. Further Mr Cavanagh is correct when he relied on Mr Paines's submission as follows:

'… The ECJ has consistently held since case 170/84 Bilka [1986] IRLR 317 that Article 141 is infringed where part-time employees are excluded from an occupational pension scheme, where that exclusion affects a far greater number of women than men and where the scheme and employer cannot show that the exclusion is based on objectively justifiable factors unrelated to any discrimination on grounds of sex. The whole of the case law of the ECJ on pensions has concerned substantive inequality between part-timers and full-timers, not differences in the administrative procedures for gaining access to schemes'"

1. Those observations, together with my acceptance for the purposes of the debate but not of decision, of the Respondents' argument (see paragraph 54 above), support Mr Draycott, at least in respect of his argument that there is a breach of the equality clause during the closed period. The time has come for a decision to be made following argument on the point. Neither in Preston No. 3 nor in any of the above ECJ cases did the issue arise for decision as to whether there was a compensable breach of the equality clause where membership of the relevant scheme was voluntary for full-timers and part-timers alike. In our judgment the fact that in each of the ECJ cases cited to us, the scheme was obligatory for full-timers meant that it was not necessary to consider what the Claimants would have done had the scheme been open. Similarly, since access to the pension scheme means access to pay, by denial of access there was a real detriment in that pay overall was less for the part-timers.

1. In all of the ECJ cases (para 29 above), the common theme is that a pension scheme was compulsory for full-timers. It is clear that those Claimants all suffered a detriment or disadvantage in that they suffered loss of pay. This applied most clearly to certain of the Claimants in the Preston litigation who had been denied access to a scheme when it was at the relevant time obligatory for full-timers to join; they suffered a material loss (see Preston No. 3 at paragraphs 30 to 55 - Appeal Issue 3 ("Is there a breach of the 1970 Act where scheme membership is compulsory for full-time staff but part-time staff are excluded?"). The claimants succeeded in Preston at first instance and on appeal. They suffered a reduced pension benefit and they would have received that benefit but for the scheme being closed to them. It follows that in none of the cases cited above was it necessary to form a view about the existence of a right, or separately a remedy. As far as the Claimants in the present case are concerned, it would be right to have an equality clause in their contracts giving them access to the scheme, irrespective of whether they suffered loss from the missing term.

1. Taking a traditional common law approach, there is a breach of the equality clause for it does not contain a term entitling the Claimant to access to the pension scheme. Applying the formula in Bilka, there is no additional requirement for the Claimant to prove material loss. As it happened in Bilka and in all the other cases, she was assumed to have suffered actual loss. No issue arose about this.

1. The question is: can Bilka be used to support the Claimants' wider argument that they are not required to show actual loss? An approach to the answer to this question may be found in two cases before the Court of Appeal: Slack v Cumbria County Council (Equality and Human Rights Commission Intervening) [2009] ICR 1217, Mummery LJ giving the judgment of the court for himself, Smith and Goldring LJJ; and [North Cumbria University Hospitals NHS Trust v Fox]() [2010] EWCA Civ 729, Carnwath LJ giving the principal judgment with which Smith and Rimer LJJ agreed. Both of those appeals were determined in favour of the Claimants on the basis of arguments addressed for the first time in the Court of Appeal on behalf of the EHRC in the first case, and adopted by the Claimants in the second. Both cases concerned the application of Preston to cases where the Claimants were said to have a "stable employment relationship" so that time did not begin to run for the presentation of an equal pay claim while they were in that relationship and the claim could be presented up to six months thereafter.

1. As Carnwath LJ makes clear in Fox, the concept of a stable employment relationship arose for the first time in the Judgment of the Court of Justice in Preston, it not having been advanced by the parties and not forming any part of the Advocate General's opinion. A stable employment relationship exists where there is a series of short-term contracts and so the Claimant does not have to make a claim for equal pay at the end of each one but may wait while the relationship exists and for six months thereafter. Although Preston also involved the limitation on backdating of awards, no other criticism was made of the approach in domestic law to remedy for breach in occupational pension cases, that is, the discretionary award of a declaration, and an order that the employer provide funding. In Slack there is no reference to my judgment in Preston (No 3). In Fox there was, and Carnwath LJ said this:

"17. When the case returned to the EAT [2004] IRLR 96, Judge McMullen QC adopted a limited view of the scope of the new principle. He thought it was intended "to rescue employees who do not have a permanent job" and that it was confined to cases of the kind considered by the ECJ; that is those relating to Applicants who -

"work regularly but periodically or intermittently for the same employer under successively but legally separate contracts." (Para 113 to 114)

18. In Thatcher v Middlesex University [2005] All ER(D) 82, (quoted at length in Minister for Health v Rance [2007 IRLR 65 para 52) he introduced a further refinement. Basing himself on some comments of the Employment Tribunal in Preston itself, he said, (para 7) a stable employment relationship ceases where the terms of the contract or (and I emphasise the word "or") the work done under it radically differs …

19. For a time, this approach appears to have been accepted as orthodoxy by the profession. However, in Slack v Cumbria CC [2009] IRLR 463, the Court of Appeal had occasion to consider the application of the principle on facts rather different from those of Preston."

Carnwath LJ adopted what Mummery LJ had said in

Slack as follows (para 97 to 100):

"The Claimants disagreed. They submitted there is no logic in a distinction confining the concept of a stable employment to cases in which there are contract-free breaks in the succession of employment contracts. The irresistible logic of the reasoning of the Courts of Justice under the purpose of the 2003 Regulations is that an uninterrupted succession of contracts is an a fortiori case of a stable employment relationship.

...

"26. It would probably be enough to say that we are bound by the judgment in Slack, and that there is no reason to distinguish it. However, since the message of that case seems to have taken a little time to sink in with the profession, it may be helpful to add some supporting explanation…

28. Although the ECJ adopted the new concept with reference to a case in which there was "a succession of short-term contracts" (reflecting the facts of the cases before it) their language does not confine it to that factual situation. On the contrary; if stability of the relationship is the guiding principle, it would be perverse to hold that a succession of long term contracts cannot achieve the same result.

29. Thirdly, it is significant that the concept of a "stable employment relationship" as adopted by the ECJ in Preston appears to have been entirely new.

31. By adopting an entirely new expression, the court was, as I read the judgment, signalling a wish to distance itself from all these various formulations…

32. In particular, as I understand it, the word "employment" in this phrase was intended to refer to the nature of the word, rather than the legal terms under which it is carried out. Thus in stipulating that a "succession of contracts" must be in respect of "the same employment", the court cannot have intended to use the word "employment" in the legal sense of a contract in employment, since the word would make nonsense of the sentence. The natural alternative is a reference to the type of work, or job."

1. In short, the court took the view that to apply the ECJ's ruling in Preston only to relationships which consisted of short term contracts was "too narrow" and that the orthodoxy which existed since Employment Judge Macmillan gave effect to it in 2002 and I upheld his judgment in 2004, was brought to an end.

1. What is significant about the above passage is that the court in Fox was prepared to give a wider meaning to the judgment of the ECJ, and to depart from what the Court of Appeal in Slack had determined, basing itself on the House of Lords' judgment in Preston, as the correct contractual analysis. It is submitted by Mr Draycott in the present case that a wide meaning should be given to the ECJ judgments starting with Bilka so as to give a right, and a remedy, to Claimants who were excluded from the opportunity voluntarily to join the scheme i.e. during 1976 and after 1 June 1988.

1. On the other hand, Mr Lewinski submits that the rights which the Claimants derive from the European Treaty are based upon providing reparation for those who are wronged by discriminatory acts. He contends that it is necessary to establish what he describes as a "cause of action" that there must be valuable reparation and it is only available where the Claimant has proved loss and damage.

1. We consider Mr Draycott is right, to some extent. Fox teaches us that a broader approach than a pure contractual analysis is necessary. As we have said above, a contractual analysis according to English law yields the result that there is a breach of contract where a term is broken and that gives rise to a remedy. The broader approach is necessary in order to give effect to the principle of equality which informs our European obligations. There was discrimination in this case during the closed period. The equality clause implied by section 1 of the Equal Pay Act introduced the same term into the women's contracts as in the men's i.e. that the pension scheme was open to them. Failing to give them access to the scheme was a breach of that term. Thus both by a simple contractual analysis, and by an appeal to the principle of equality without discrimination in the Treaty, the Claimants are entitled to say in ordinary language that they have been wronged.

1. It seems to us that the principle under the Treaty and flowing from the judgment of the European Court in Marshall v Southampton and South West Area Health Authority Number 2 [1993] ICR 893 ECJ is that a real and effective remedy is to be given so as to enable loss and damage sustained by any given Claimant to be made good. We note that the declaratory remedy in the 1976 Regulations was carried on after Marshall by the amendments to the Equal Pay Act 1970 ss2(5), 2(6B) and 2(7B) by Regulations 6-9 of the 1995 Regulations. It was re-enacted in similar form in the Equality Act 2010 ss 132-133. Damages must not be awarded, a declaration may be. We agree with Employment Judge Macmillan in the Preston case (at paragraphs 153 of his judgment) that the purpose of this is to allow for merely technical breaches, where no loss follows, the equivalent of an award of nominal damages.

1. The next question is whether they have a right to a declaration for this. Remedies for breaches of the Equal Pay Act and Article 141 obligations were comprehensively reconsidered in Slack. The Court of Appeal unequivocally decided that the remedies as adjusted by legislation and by judicial authorities now provided under the Equal Pay Act meet the UK's obligations.

1. We also bear in mind that in Slack and Fox the court was not dealing with the specific remedies available in what are now described in the Equality Act as pensions cases. They were non-pensions cases. Nevertheless, the court decided that there was no incompatibility now between the EU and UK legislation. There was no suggestion at any stage in the Preston litigation or in any other case that if the Claimant succeeded in any given claim, a discretionary declaration was an incompatible remedy. Whenever a declaration is made and the entry date is some time prior to the date of the declaration, the employer is required to provide resources to fund her admission. The Tribunal must find a breach and then may make a declaration. There does not appear to be an intermediate stage of a declaration of a breach of contract.

1. For a Claimant to succeed on a remedy she must obtain a declaration that she is to be admitted to the scheme. That may seem a hollow victory for her, but in our judgment, it represents a vindication of her right not to be discriminated against in relation to access to the scheme. The reason for the declaration being discretionary and not mandatory is found in these very cases. This reflects the common law position that a remedy for breach of contract will not be awarded unless the Claimant has suffered loss. On the evidence in these cases, most of the Claimants suffered no loss as they would not have joined the scheme when it was closed to them. In simple terms, neither in EU law nor under English contract law is there an entitlement to valuable reparation where no loss has occurred.

1. Finally, it might be thought that a simple solution to the argument about the inadequacy of a discretionary declaration is to say that it has not been refused in any of the sample cases where loss has been proved by the Claimant's actual exclusion from the scheme. In every case she obtained the declaration entitling her to access, and requiring the Respondents to fund it. None claimed that the statutory remedy was inadequate when compared with a contractual right to damages or even a mandatory statutory right to admission.

1. We do not consider the ECJ judgment in Bilka can be read as requiring the domestic court to extend the protection of those denied access to an obligatory scheme to those who suffer no loss by not joining a voluntary scheme. We do not need to refer this question to the CJEU for the answer is clear to us.

1. Subject to what we say below about the applicable legislation, that disposes of the majority of the sample cases.

1. The Employment Tribunal made declarations in favour of three of the sample Appellants. It was accepted that during the closed period, they would have joined the pension scheme and so were entitled to a finding that there was a breach and in its discretion, the Tribunal made a declaration. As to timing, the declaration tracked the period when the scheme was closed to the relevant Claimants. It did not live on after, in their respective cases, the scheme was opened to them.

1. They contend that this is a further breach of their rights. Mr Draycott submits that once the declaration is made, it stays in place for as long as the employment continues. Mr Lewinski contends that the declaration is there to give effect to the finding that there has been a breach of the equality clause but that once the breach is remedied by the opening of the scheme to the Claimant, there is no need, utility or right in the Claimant to seek the court's assistance by a declaration.

1. The three sample Claimants to whom this directly relates are Ms Copple, Ms Ferguson and Ms Westworth, of whom Ms Copple is the paradigm. She obtained a declaration relating to the period in 1976 when the scheme was closed to her. When the scheme was closed to all new entrants of the graded category on 1 January 1977, if not excluded hitherto she would have stayed in it. When the scheme was opened to graded employees like her on 1 June 1988, she was again excluded, until the scheme was open to her doing the hours she did. Thus the declaration in her favour entitled her to access to the scheme from 1976 to 1991. As for the other two, they obtained declarations from 1 June 1988 to the date in their cases when the scheme was open to them. Their argument today is that once they achieved a declaration, it remained in place notwithstanding that the scheme was open to them.

1. This point is covered by my judgment in Preston (No.3). I upheld Employment Judge Macmillan on this point and said the following,

"12. The only remedy I can give is a declaration requiring the employer to admit her to the pension scheme between certain dates. The declaration is not restricted to the two year period immediately before the date on which the applicant started her tribunal claim. It can cover any period during which her part-time hours excluded her from membership of the pension scheme right back to the start of her employment or, if later, the 8th April 1976.

67. Where an applicant was always eligible to join a pension scheme but did not do so, or did not do so after becoming eligible to join, can her cause of action in the employment tribunal extend beyond the date on which she became eligible to join where

(b) her reason for not opting into the scheme was because of her employer's failure to alert her to the possibility of doing so;

(c) she attempted to opt into the scheme but was either discouraged from doing so, persuaded not to do so or continued to be denied the opportunity to do so.

77. I accept the submissions of Mr Paines. If there is a breach of the duty to inform, that sounds as a separate claim and does not relate to the right to an equality clause. In the cases envisaged, but not the test cases, the Scally implied term comes into effect at the same time as the removal of the barrier across the entry to the scheme. In my view, when the inequality is removed, the failure to notify the applicant about it is not a continuing inequality in breach of the equality clause, but may well be a breach of the Scally implied term. In other words, the employer ceases to be in breach of the equality clause, but becomes liable for breach of the Scally implied term."

1. The Employment Tribunal in the instant case was, therefore, bound to follow this judgment but it is open to us, if we consider it should not be followed, to decline to do so. It is not the view of any of the three of us that the case was wrongly decided. Nevertheless, we have given very careful consideration to Mr Draycott's arguments, since they are based upon the judgment of the EAT in Sorbie v Trusthouse Forte Hotels Limited [1977] ICR 55 which was not cited at first instance or on appeal in Preston (No 3).

1. Take the case of Ms Westworth. She joined the Respondent in 1972 but would not have joined the pension scheme prior to 1977 and no declaration was given in respect of that period. It follows that none was available from 1977 to 1988 when the scheme was closed to all graded employees. The declaration was given in respect of 1 June 1988 to 1 January 1991 while the scheme was closed to her. When the scheme was open to her on 1 January 1991, there became, we assume, an express term that she could join the scheme. She joined it on 22 January 1992. The term declared in her favour, was already as a matter of law a term of her contract. This term was implied in order to give effect to the Equal Pay Act and the Pension Regulations.

1. There was no need thereafter for the law to imply any such term in the contract. Indeed, applying normal contractual principles, there is no scope to imply a term where there is an express term to the same effect. Thus, by 1991, the Respondent had put right the unlawful discrimination, long before proceedings were intimated in Ms Westworth's case. In reality what she seeks is a declaration that she was entitled to access to the scheme during the one year between the opening of the scheme to her and her joining it. In similar circumstances, Ms Copple delayed joining for four years and so she seeks a declaration to cover that period. Ms Ferguson delayed joining for six months which the Tribunal found to be covered by an acceptable explanation. Yet it awarded her a declaration only during the closed period.

1. Nevertheless, the argument for these three sample Appellants is that once a term has been implied by reason of the Act and the Regulations, it remains in place notwithstanding the parties' agreement on an express term. The court is required to grant a declaration to give effect to the principle of non-discrimination even where the parties have done it themselves. Put in that way, it is hardly surprising that the Tribunal declined to grant such relief on an open-ended continuing basis. If the Respondents had recognised the wrong done to the women during the closed period and had granted access without the need for the Claimants to go to the Tribunal, we see no basis for them to seek relief in respect of a discriminatory term which no longer existed in the contract.

1. The facts in Sorbie provide an interesting curiosity from the earliest days of this legislation. It came into effect on 29 December 1975. Waiters and waitresses in a hotel at London Heathrow were paid differently, the women 12.5p an hour less than the man. On 5 January 1976, he was promoted to supervisor. The women claimed equal pay for the seven days prior to his promotion. They succeeded in obtaining a declaration for that period but thereafter the declaration was refused. This was because they were no longer on "like work" with the waiter. The EAT upheld their appeal granting a declaration from 29 December 1975 without any subsequent temporal limitation. Philips P giving the judgment of the EAT said this:

"Upon an application made to an industrial tribunal under section 2 – where we think there is a power to grant a declaration, or to order the payment of arrears of remuneration, or damages in respect of contravention – the situation is that the industrial tribunal, if it so applies section 1(2)(a)(i), will find that the contracts of the appellants when modified contain a clause under which they are entitled to remuneration at the rate of 97½p. In other words, once the section is applied and the contract is modified, there is then a contract providing remuneration at that rate. It seems to us that the true way of looking at it is that that contract remains so modified until something else happens, such as a further agreement between the parties, a further collective agreement or a further statutory modification by reason of a further operation of the equality clause…it seems to us that when making the order under section 2 the [employment] tribunal has to take the contract of employment as so modified, with the consequence in this case that after December 29, unless and until there is some further change, the remuneration continues at the rate of 97½p."

1. This point was followed by Elias P in Sodexho Limited v Gutridge [2008] IRLR752 where he said this:

"61. ..if correct, it would mean that a woman would lose her right to the enhanced pay she had secured under the Equal Pay Act if the comparator is promoted or leaves the company…

62. I have no doubt at all that this analysis is wholly misconceived…. once the discrimination is established, the woman is entitled to receive what the man is paid. That is the proper non-discriminatory rate for the job. She does not just receive that increase for the period for which the man receives it, only to have her pay reduced again to the 'woman's rate' if and when he ceases to be a comparator.

63. ..of course, a woman cannot continue to compare herself with the man once he ceases to be a comparator, but she does not lose such enhanced rights as have already been incorporated into her contract. Those rights are by then crystallised and she remains entitled to enforce them as a term of the contract."

1. This approach was endorsed by the Court of Appeal: [2009] IRLR 724 CA.

1. With respect, we agree with all of the above judgments and their easy application where a non-pensions claim is in issue. It would be wholly unfair and impracticable for pay to be adjusted downwards according to the profile of the workforce at any given time. So a woman who is entitled to an implied term in her equality clause of equal pay with a currently serving man does not lose it when he leaves or is promoted. The term relating to pay in her contract is modified by the statutory implication and stays so modified until, as the EAT put it in Sorbie, "something else happens such as a further agreement between the parties". That is what happened in our case: the parties agreed that the terms would include open access to the pension scheme. Indeed, Mr Draycott acknowledged that the argument he raised had limitations. The implied term would cease to have effect when the Claimant joined the scheme.

1. In our view, to allow the declaration to continue during the open period up until the time she actually joined the scheme would be to give her an advantage over her colleagues who did not so join. She would be in a better position than a full-timer whose contract at all times included a term that he could join the scheme, but who never did. In the closed period, the implied term operated to equiperate her terms with his so that both had the right to join the scheme. In his case it is express and in hers implied. When the scheme was open to all, there was an express term in her contract, and in his, giving a right of access to the scheme. There is no discrimination of any sort going on thereafter and no reason in law why she should be compensated for not joining the scheme, by extending a declaration to her, when he is not entitled to it. The reason why neither of them joined the scheme is not found in discrimination but in choice. For that matter, she would also be in a better position than a female full-time colleague. Whether she joins the scheme or not, she may be offended by the existence of the exclusionary rule in some contracts operated by her employer. But it is not suggested that she has a right to complain for, of course, there is no breach of contract in her case nor any loss. She is correctly regarded as a bystander.

1. The failed logic of Mr Draycott's argument is shown by his acceptance that the right to the implied term, and to the declaration, ceases when the Claimant joins the scheme. She no longer needs the protection of either. The declarations given in this case are that each Claimant has the right to be admitted to the scheme during the closed period. That is because her contract during that time includes the implied term that she has the right to join the scheme. That term does not evaporate, but remains in place during the open period as an express term agreed by the parties, and also for what it is worth, during the period after she becomes a member. She does not need the protection of the court because she has achieved her end by agreement with the Respondents that she will be offered access to the scheme, and whether she joins the scheme or not is irrelevant. The declaration does not require her to join; it requires the Respondents to admit her, if she wants. We reject the argument on the Sorbie point.

1. It may seem odd that we are addressing arguments as to the applicable legislation in this case after we have made the decisions above but this is the way in which counsel presented the arguments to us and to the Employment Tribunal.

1. The Employment Tribunal found Mr Draycott's argument "mercurial" and it preferred Mr Lewinski's. So do we. Mr Draycott's thesis is that the opters test is incompatible with EU law as it presently stands. The nub of his argument is that the current language of EU Directives, and Regulations flowing from them in the UK is that the requirement for detriment in an individual case as we have decided is supplemented by the hypothetical test of a requirement "which puts or would put [women] at that disadvantage".

1. In order to deal with this matter, it is necessary to peel back the layers of this legislative onion. The argument was addressed to the Employment Tribunal but in addition, a new complication has arisen before us since the Equality Act 2010 came into effect on 1 October 2010, during our hearing. In response, both counsel have submitted additional material to us on this and the broader subject.

1. To some extent, Mr Draycott gets support for this argument from part of the judgment I gave in Pike v Somerset County Council [2008] UKEAT/0046/08 at paragraph 28:

"28. It was not immediately clear to me whether the correct law to be applied to the offending rule ("PCP") is that in force up to 12 October 2001, between 12 October 2001 and 30 September 2005 or from 1 October 2005, reflecting legislative changes. The essence of the three tests is a non-trivial disadvantage to women but there may be different approaches to it according to the relevant date of application. I have had no submissions from the Respondents so I accept the Claimant's. In my opinion the current test for indirect sex discrimination (from 1 October 2005) is whether the Respondent applied to the Claimant a PCP which would "put women at a particular disadvantage when compared with men". Between 12 October 2001 and 30 September 2005, the test was phrased in terms of whether the PCP constituted a detriment to a "considerably higher proportion of women than men". Prior to 12 October 2001 (the Claimant brought her claim in 1994) the test was phrased in terms of whether a requirement or condition was applied which was such that the proportion of women who could comply with it was "considerably smaller" than the proportion of men who could comply. All three tests in essence require a disadvantage to women which is more than trivial or insignificant."

However, it gives him only limited support for there was no specific argument addressed to the issue in that case and all I was concerned about was to see whether the Claimant suffered a disadvantage which was not trivial. The point does not seem to have been taken in the Court of Appeal which upheld the judgment: [2010] ICR 46. These references to indirect discrimination are relevant. We rejected Mr Lewinski's short contention that this case is not about indirect discrimination. We have already paid attention to the concession made on behalf of the Respondents and to the fact that Article 141 had to be used by the Claimant at a time when indirect discrimination was not legislated for under the Equal Pay Act. This case is about indirect discrimination against women because the exclusionary rule has disparate impact upon women part-time workers.

1. Going anti-chronologically, the Equality Act 2010 is not relevant to these proceedings. From now on, section 19, which deals with indirect discrimination, and sections 64 to 76 and 79, "equality of terms" are likely to be relevant since these replace the provisions of the Equal Pay Act 1970. There is specific provision under section 133 pensions cases which retains the discretionary remedy of a declaration previously found in the 1976 and 1995 Regulations. There is provision for carry-over of acts which were unlawful before 1 October 2010 and which continue: see Article 7 of the Equality Act 2010 (Commencement No 4) Order 2010. Article 15 provides that the Act does not apply where the act complained of "occurs wholly before 1 October 2010". In our judgment, the act complained of here is exclusion from the pension scheme during the closed periods all of which ended by 1 June 1995. The Equality Act 2010 does not have retrospective effect in those circumstances.

1. On 1 October 2005, Regulation 3 of the Employment Equality (Sex Discrimination) Regulations 2005 amended section 1 of the Sex Discrimination Act 1975 to read:

"(2) In any circumstances relevant for the purposes of a provision to which this subsection applies, a person discriminates against a woman if –

(a) on the ground of her sex, he treats her less favourably than he treats or would treat a man, or

(b) he applies to her a provision, criterion or practice which he applies or would apply equally to a man, but –

(i) which puts or would put women at a particular disadvantage when compared with men,

(ii) which puts her at that disadvantage, and

(iii) which he cannot show to be a proportionate means of achieving a legitimate aim."

These amendments came by way of amendments to the Equal Treatment Directive, that is Article 2 of Directive 76/207/EEC which were themselves inserted by Directive 2002/73. This is the amended Equal Treatment Directive. That latter directive was to be transposed on 1 October 2005 and has no provision relating to retrospection. While we consider there is some substance in Mr Draycott's argument that a hypothetical situation may give rise to a claim, there must still be evidence before the court which requires it to give valuable reparation by way of compensation for detriment or damage. Even the Equality Act 2010, section 19 requires that. While transitional provisions are made in the 2005 Regulations, they are expressly stated to come into effect on 1 October 2005 and that corresponds to the transposition date of the Directive.

1. The same is true of the Equal Pay Directive 75/117/EEC which requires reparation for employees "who consider themselves wronged". Article 6 of the Equal Treatment Directive and the Recast Equal Treatment Directive 2006/54/EC, Article 17(1) apply to "all persons who consider themselves wronged" and Article 18 describes "the loss and damage sustained by a person injured as a result of discrimination on the grounds of sex".

1. The general effect of that in English law is replicated in European law, see for example, the principle in Ancienne Maison [1978] ECR 383, paragraph 48. According to a generally accepted principle, a law amending a legislative provision applies, unless otherwise provided, to the future effect of situations which arose under the previous law. This has more recently been applied in Duchon [2002] 2 CMLR 23 where the Court said this at paragraph 21,

"In that regard, it should be borne in mind that it is settled case law that the principle of legal certainty precludes a Regulation from being applied retroactively, regardless of whether such application might produce favourable or unfavourable effects for the person concerned, unless a sufficiently clear indication can be found, either in the terms of the Regulation or its stated objectives, which allows the conclusion to be drawn that the Regulation was not merely providing for the future. Although the new law is thus valid only for the future, it also applies, according to a generally recognised principle, in the absence of a provision to the contrary, to the future effects of situations which came about during the period of validity of the old law."

The Employment Tribunal in our case dissected the argument and applied those principles correctly. The relevant breach of contract was committed at various stages up to 1 June 1995. The Claimants who suffered loss by being excluded from the pension scheme which they would have joined were granted declarations. There was no continuing loss attributable to discrimination, rather than choice, after the scheme was open to them and there is no basis to apply legislation enacted in the 21st Century to these earlier breaches.

1. There is no basis for ordering a declaration that the Respondents breached the implied term during the closed period without there being a corresponding loss such as would entitle the opters to the discretionary declaration of admission to the scheme. For those who succeeded in achieving declarations, they endure only for the closed period. We dismiss the appeals.