Appeal No. UKEAT/0496/04/SM

EMPLOYMENT APPEAL TRIBUNAL
58 VICTORIA EMBANKMENT, LONDON EC4Y 0DS

	At the Tribunal
	On 11 November 2004
Judgment delivered on 1 March 2005

Before
HIS HONOUR JUDGE RICHARDSON
MR B R GIBBS
MR T HAYWOOD

(1) MS F JAMES 
(2) MS K CARDEN 
(3) MS D BUTLER	APPELLANTS

GREAT NORTH EASTERN RAILWAYS	RESPONDENT

Transcript of Proceedings

JUDGMENT

	APPEARANCES

For the Appellants	MS B CRIDDLE
(of Counsel)
Instructed by:
Messrs Drummond Miller Solicitors
22 Pavement
York 
YO1 9UP	
For the Respondent	MS J EADY 
(of Counsel)
Instructed by:
Messrs Pinsents Solicitors
1 Park Row
Leeds
LS1 5AT

SUMMARY

Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2000
Equal Pay Act 1970

The Tribunal erred in law in concluding that claims of part-time workers of less favourable treatment in respect of an additional hours allowance paid to full-time workers were barred by r 5(4) of the Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2000 and by the principle in Stadt Lengerich v Helmig [1996] ICR 35.

Case remitted to the Tribunal with some guidance as to the application of the Regulations – in particular as to the application of the pro rata principle.

HIS HONOUR JUDGE RICHARDSON

1.	This appeal concerns an allowance which Great North Eastern Railways Ltd (“GNER”) pay to their full-time workers.  We shall call it “the additional hours allowance”.  Part-time workers do not receive it.

2.	Three claims were brought by part-time workers of GNER to test whether by paying that additional hours allowance GNER discriminate against their part-time staff under the 
Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2000 or under the Equal Pay Act 1970.  

3.	By a Decision of the Employment Tribunal sitting in Newcastle entered in the Register on 28 April 2004 the claims were dismissed.  The employees now appeal.

4.	The appeal directly raises the question whether the claims are barred by r 5(4) of the 2000 Regulations and by the principle in Stadt Lengerich v Helmig [1996] ICR 35.  This was the point on which the Tribunal decided the case against the claimants.  But, as we shall see, the appeal also raises other issues – in particular, the application of the “pro rata principle” (rr. 1(2) and 5(3)) and the question whether any part of the rostered hours of full-time employees can be regarded as overtime (r. 1(3)).

GNER’s full-time employees

5.	GNER’s full-time employees are contractually obliged to work a 40 hour week, judged over the length of an 8 week roster cycle.  In any given week that cycle may result in their working more or less than 40 hours; but the overall effect, and their contractual obligation, is to work 40 hours per week over the whole cycle.

6.	In addition to the 40 hour week full-time employees may be required to work overtime.  

7.	Their pay is made up in the following manner.  Pay for the first 35 hours is paid at a basic rate.  It appears on the payslip against the word “basic”.  It is pensionable.  Pay for the next 5 hours is paid in a lump sum which is calculated at the rate of 1¼ times basic pay.  It appears on the payslip against the words “additional hours”.  It is not pensionable.  Any overtime over and above the 40 hours is paid according to time worked at 1¼ times basic pay.  It appears on the payslip against the word “overtime”.

8.	It is principally the pay for “additional hours” with which this appeal is concerned, though this element must be seen in the context of the whole pay structure.  We have called this element “the additional hours allowance” although the name given to it has fluctuated over the years.

9.	The additional hours allowance is reduced if the full-time employee is absent from work, for example for sickness.  The reduction is calculated on the basis of the ratio of hours absent to the total number of rostered hours in the week in question.  Thus if the rostered hours for the week were 40 (ie, an average week), and the employee was absent for 14, then 14/40ths of the allowance would be withheld.

10.	The additional hours allowance is payable in full if the full-time employee is on agreed annual holiday.

11.	By way of explanatory background, we set out briefly the history by which this wage structure has been reached.  This does not appear in the Tribunal’s Decision, but it was in the papers before them, and it is common ground.  Until 1997 full-time workers were contracted to work for 39 hours.  All overtime was voluntary but it was often rostered, and relied on both by employer and employees.  GNER wished to have greater flexibility in its rostering and organisation structure.  It was willing to shorten the working week.  The union, the RMT, was naturally anxious to ensure for its members that a certain level of earnings would be guaranteed.  The negotiated settlement introduced a contractual commitment to work 42 hours (ie 3 hours longer than before, but shorter than employees often worked) and introduced the additional hours allowance to bridge the gap between a notional 37 hour basic week and the actual contractual commitment of 42 hours.  Over the years since 1997 the contractual commitment for full-time employees has reduced to its present 40 hours.  

Part-time employees

12.	The part-time employees who brought claims were Mrs James, a customer service assistant who worked a 25 hour week, Mrs Carden, a customer services manager who worked a 30 hour week, and Mrs Butler, a chef who also worked a 30 hour week.

13.	Part-time employees are contractually obliged to work a set number of hours per week (eg, 25 hours or 30 hours as above).  As with full-time employees, the set hours are judged over the length of an 8 week roster cycle.  In any given week that cycle may result in their working more or less than the set hours; but the overall effect, and their contractual obligation, is to work the set hours per week over the whole cycle.

14.	As with full-time employees, part-time employees may be required to work overtime.

15.	Pay for the set hours is at the same basic rate as their full-time equivalent posts.  (This is subject to a small caveat, with which we will deal below).  Pay for any overtime up to 35 hours is at that same basic rate.   Pay for any additional hours over 35 hours will be at 1¼ times basic pay.  There is no additional hours allowance in any circumstances.

16.	Pay for annual holiday is equivalent to the salary which would be paid if the day had been worked.   It follows that pay for annual holiday will not include any additional hours allowance.

Comparing full-time and part-time employees

17.	This is a convenient moment at which to compare the pay of the full-time employee and the part-time employee.

18.	The calculations which follow are illustrative calculations of ours, put to counsel for the parties during the appeal in order to assist us to understand the argument of the parties.  They appear to us to follow from the findings of the Tribunal.  But they are subject to a cautionary note, which we set out below.

19.	Let us suppose that a full-time worker and a part-time worker doing the same job both work their average contractual rostered hours.  Let us also suppose that the basic rate of both is £10 per hour and the part-time worker is contracted to work 30 hours.

20.	Then the full-time worker will work 40 hours and will receive £412.50 (ie, £10 x 35 + £12.50 x 5).  This equates to an hourly rate of £10.31 per hour.  The part-time worker will work 30 hours and will receive a straight £10 per hour.  There is a difference of 31 pence per hour.

21.	This difference of 31 pence per hour will also apply to holiday pay.

22.	These illustrative calculations show the difference in hourly rate resulting from the additional hours allowance if both full-time and part-time workers work their contractual hours.  

23.	There may in addition be circumstances in which the additional hours allowance works to greater advantage for the full-time worker – for, as we have seen, it is deducted only at the rate of 1/40 for each hour the full-time employee does not work.  The Tribunal made this point in paragraph 6 of its Decision, but did not make any findings as to when this might occur.  Ms Eady, for GNER, submitted that many supposed anomalies would not be “real world” cases.  She said that the most likely anomalous case might be if the full-time worker could not actually be rostered for the full 40 hours per week due to a service alteration. 

24.	We now sound our note of caution.  Within the bundle of documents before the Tribunal were comparative figures produced by GNER’s Mr McMurray, giving hourly rates for GNER’s workers.  These figures cannot be precisely reconciled with our illustrative figures above.  We were told that this might in part result from fractional differences in the basic rates of full-time and part-time workers.  The Tribunal made no findings as to Mr McMurray’s figures.  The Tribunal clearly worked on the basis that the basic rate was the same for both full-time and part-time workers.  

The Part-Time Workers Regulations

25.	It is now convenient to turn to the Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2000, returning only briefly in this judgment to the Equal Pay Act.  In this judgment we will concentrate on the Regulations for two reasons.  

26.	Firstly, this case falls squarely within the ambit of the Regulations.  It was common ground before the Tribunal, and remains common ground, that the three claimants were part-time workers (r. 2(2)) who could point to comparable full-time workers (r. 2(4)).  Secondly, and no doubt for that very reason, the argument we heard was directed primarily to the Regulations.  It was not suggested by counsel for either party that an analysis under the provisions of the Equal Pay Act would produce a different result.

27.	The Regulations were passed to implement Council Directive 97/81/EC, extended to the United Kingdom by Council Directive 98/23/EC.   The Directive is commonly known as the Part-Time Work Directive.  It implemented a Framework Agreement reached between cross industry European management and labour organizations.  A stated purpose of the Framework Agreement was to remove discrimination against part-time workers: clause 1.  A principle of non-discrimination was adopted: see clause 4.  The power to make the Regulations derives from s. 19 Employment Relations Act 1999.

28.	The claimants each alleged infringement of the right conferred by r. 5 -

“5 Less favourable treatment of part-time workers
(1) A part-time worker has the right not to be treated by his employer less favourably than the employer treats a comparable full-time worker -
(a)	as regards the terms of his contract; or
(b)	by being subjected to any other detriment by any act, or deliberate failure to act, of his employer.
(2) The right conferred by paragraph (1) applies only if - 
(a)	the treatment is on the ground that the worker is a part-time worker, and
(b)	the treatment is not justified on objective grounds.
(3) In determining whether a part-time worker has been treated less favourably than a comparable full-time worker the pro rata principle shall be applied unless it is inappropriate.
(4) A part-time worker paid at a lower rate for overtime worked by him in a period than a comparable full-time worker is or would be paid for overtime worked by him in the same period shall not, for that reason, be regarded as treated less favourably than the comparable full-time worker where, or to the extent that, the total number of hours worked by the part-time worker in the period, including overtime, does not exceed the number of hours the comparable full-time worker is required to work in the period, disregarding absences from work and overtime.”

29.	The definition of “pro rata principle” is found in r. 1(2) as amplified by r. 1(3) -

“1(2) In these Regulations –
…
“pro rata principle” means that where a comparable full-time worker receives or is entitled to receive pay or any other benefit, a part-time worker is to receive or be entitled to receive not less than the proportion of that pay or other benefit that the number of his weekly hours bears to the number of weekly hours of the comparable full-time worker;
…
(3) In the definition of the pro rata principle and in regulations 3 and 4 “weekly hours” means the number of hours a worker is required to work under his contract of employment in a week in which he has no absences from work and does not work any overtime or, where the number of such hours varies according to a cycle, the average number of such hours.”

30.	Regs 5 (1) – (3) find their genesis in the Framework Agreement.

31.	Reg 5(4) does not find its genesis in any provision within the Part-Time Work Directive.  For the background to reg 5(4) it is necessary to look at the decision of the European Court in Stadt Lengerich v Helmig [1996] ICR 35.

32.	This case concerned overtime supplements laid down in collective agreements.  Full-time workers who worked more than the number of ordinary weekly working hours for full-time workers were paid an overtime supplement in respect of extra time worked.  Part-time workers who worked more than their contractual hours but fewer than the ordinary hours for full-time workers received pay for extra work only at the same rate as that for their contractual hours.  The part-time workers were women.  They claimed that, having regard to the provisions of European law concerning equal pay, they were entitled to overtime supplement for all time worked over their contractual hours.

33.	The European Court rejected this argument.  It held that there was no discrimination incompatible with European law because under the collective agreements part-time employees received the same overall pay as full-time employees for the same number of hours worked, irrespective of the number of hours worked.  On the question whether the collective agreements established different treatment for full-time and part-time employees the European Court said

“..  it must be determined whether they establish different treatment for full-time and part-time employees and whether that difference affects considerably more women than men.
24. That is the nature of the review traditionally exercised by the Court of Justice in this area: see, inter alia, Kowalska v. Freie und Hansestadt Hamburg (Case C-33/89) [1992] I.C.R. 29 and Bilka-Kaufhaus G.m.b.H. v. Weber von Hartz (Case 170/84) [1987] I.C.R. 110. 
25. Only if those two questions are answered in the affirmative does the question arise of the existence of objective factors unrelated to discrimination which may justify such a difference in treatment. 
26 There is unequal treatment wherever the overall pay of full-time employees is higher than that of part-time employees for the same number of hours worked on the basis of an employment relationship.
27 In the circumstances considered in these proceedings, part-time employees do receive the same overall pay as full-time employees for the same number of hours worked.
28 A part-time employee whose contractual working hours are 18 receives, if he works 19 hours, the same overall pay as a full-time employee who works 19 hours.
29 Part-time employees also receive the same overall pay as full-time employees if they work more than the normal working hours fixed by the collective agreements because on doing so they become entitled to overtime supplements.
30. Consequently, the provisions at issue do not give rise to different treatment as between part-time and full-time employees and there is therefore no discrimination incompatible with article 119 of the Treaty and article 1 of the Directive
31. It must therefore be stated in reply to the first question that article 119 of the E.E.C. Treaty and article 1 of Directive (75/117/E.E.C.) of 10 February 1975 on the approximation of the laws of the member states relating to the application of the principle of equal pay for men and women do not prevent collective agreements from restricting payment of overtime supplements to cases where the normal working hours fixed by them for full-time employees are exceeded.”

The issues

34.	It was common ground before the Tribunal, and remains common ground, that the three claimants were part-time workers (r. 2(2)) who could point to comparable full-time workers (r. 2(4)).  Potentially the following issues arise.

1.	Are GNER’s part-time workers treated less favourably by GNER than the comparable full-time workers as regards the terms of their contract because they are not paid the additional hours allowance?  See r. 5(1)(a).

In determining the first issue, three sub questions arise.

1A. 	Is it appropriate to apply the pro rata principle?  See r. 5(3).  
1B.  	If so, how is the pro rata principle applied, and with what result?  In particular, what are the “weekly hours” which are taken for comparison?  See r. 1(2) and (3).
1C. 	Are the claims barred by the statutory disregard contained in r. 5(4)?

If issue 1 is resolved in favour of the employees, then -

2.	Is that less favourable treatment on the ground that they are part-time workers?  See r. 5(2)(a)

3.	If so, is the treatment justified on objective grounds?  See r. 5(3).

The Tribunal’s decision

35.	The Tribunal’s conclusions are as follows.

“15  We accept that the enhanced payment is a combination of requiring employees to do a certain amount of overtime, above the basic 35 hour week, and an incentive for them to turn up for work for the 5 hours to receive the enhanced payment. It is not of itself just a mere overtime payment. It provides flexibility to the respondents in the roistering of their employees who maybe roistered for say a 30 hour period or a 45 hour period in any particular week but over an 8 week cycle 40 hours per week.
…
17  A part-time employee is paid pro rata to the full-time employees basic rate for the number of hours that that part-time worker works. The part-time worker does not get an enhanced payment. The part-time worker is contracted to work the number of hours agreed between her and the respondent be it 20 hours or 30 hours. If the part-time worker works longer than her contracted period she is paid at the hourly basic rate until such time as she achieves 35 hours of working after which she will get overtime payment. That is in accordance with regulation 5(4). 
18  As we see it the applicants are wanting to be paid for part of their hours at work at their basic rate of pay and a further part at the enhanced rate of pay. So that a part-time worker working 30 hours a week would be paid at basic rate for 22.5 hours and at the enhanced rate 7.5 hours. That would mean that the part-time worker would be paid, over the 30 hour period, at a higher rate than the full-time worker would be paid on the same 30 hour period. 
19  The part-time worker would, if entitled to the enhanced payment, be treated more favourably than the full-time worker. The part-time worker would also be in receipt of higher hourly pay than the full-time worker. . 
20  If the enhanced payment is worked at as an overtime payment (we find it is a combination of overtime and incentive) the applicants’ contention fails. The enhanced payment is caught by regulation 5(4) of the Part- Time Worker Regulations. The enhanced payment fails under the Equal Pay Act – Stadt Lengerich -v -Helmig [1995] IRlR 216. 
21  It appears to us that if we were to agree to the submissions of the applicants we would be providing them with a high rate of pay for the hours they work as compared to the full-time workers. We dismiss the applicant’s claims.”

36.	It will immediately be apparent that the Tribunal did not approach its findings in any closely structured way.  The issues which we have identified above, all potentially applicable, are not separated out and addressed.

37.	As we understand the Tribunal’s findings, it concluded that the additional hours allowance was a combination of overtime and incentive.  This was sufficient to bring it within regulation 5(4) of the 2000 Regulations  and the principle in Stadt Lengerich v Helmig [1996] ICR 35.

38.	  The Tribunal seems to have considered that the statutory disregard was sufficient to prevent the additional hours allowance being considered less favourable treatment for the purposes of the 2000 Regulations.  In other words, the Tribunal decided the issue which we have identified at 1C above in GNER’s favour.  This must be the reason, we think, why there is no consideration of the question of objective justification.

39.	It is plain that the Tribunal had in mind the absurdity which would flow if the case for the claimants was taken at its highest.  At its highest, the claimants sought to have the additional hours allowance (which, it will be remembered, was paid as a lump sum) added to their pay in proportion to the hours they worked as compared to a full-time employee.  If this were the result, the consequence would be that a part-time employee who worked 30 hours per week would receive three quarters of the additional allowance – hence, in practice, a much higher rate of pay per hour than her full-time equivalent.  The Tribunal pointed out this absurdity in paragraphs 18 and 19 of the Decision.  We shall return to it.

Discussion and conclusions

The application of r. 5(4)   (Issue 1(C)

40.	We consider first the issue upon which the Tribunal decided the case – viz, that the claims were effectively barred by r. 5(4).  On behalf of the claimants, Ms Criddle submitted that r. 5(4) was applicable only to overtime properly so-called.  It did not apply to the additional hours allowance, which was paid in respect of rostered hours, and was not a true overtime payment.  On behalf of GNER, Ms Eady submitted that the Tribunal was correct in holding that the allowance fell within the “exception” permitted by r. 5(4).  The allowance, she submitted, was a payment in consideration for the commitment to work a full 40 hour week.  This commitment was not given by part-time workers, nor could it be by the very nature of their part-time work.  This, she submitted, was sufficient to attract the application of r. 5(4).

41.	In our judgment the Tribunal erred in law in holding that the additional hours allowance was caught by r. 5(4).  Our reasons are as follows.

42.	R. 5(4) applies a statutory disregard where a part-time worker is paid at a lower rate for overtime worked by him than a comparable full-time worker is or would be paid for overtime worked by him in the same period.   He is not to be regarded for that reason as treated less favourably than his full-time counterpart if and to the extent that the hours he has worked, including overtime, do not exceed the hours worked by his full-time counterpart disregarding overtime.

43.	R. 5(4) is in our judgment plainly directed to the situation which obtained in Stadt Lengerich v Helmig.  As we have seen, the part-time workers were claiming in respect of overtime worked by them.  They said their overtime rate was lower than that of full-time workers.  

44.	In our judgment the nature of the claim of the part-time workers in this case is significantly different.  They are claiming more pay for the contractual rostered hours they work.  They say that full-time workers are paid the additional hours allowance in respect of their contractual rostered hours.   Therefore, they say, they should be paid a proportionate amount of the additional hours allowance in respect of their contractual rostered hours.  Their claim does not in any way depend on whether they work overtime.  In our judgment the statutory disregard in r. 5(4) cannot in principle bite upon such a claim.

45.	It is true that if the part-time workers in this case are successful in establishing that they are entitled to a higher rate in respect of the contractual rostered hours they work, it will follow that they will receive the same higher rate in respect of the overtime they work even if it is within a total of 40 hours.  But this will not be for the reason that their overtime rate was lower than that of a full-time worker.  It will be for the reason that their pay for their contractual rostered hours was lower than that of a full-time worker, and this will carry over into overtime.  

46.	We therefore conclude that the Tribunal erred in law in holding that reg. 5(4) was determinative of the case.  It was not.  Nor was the principle in Stadt Lengerich v Helmig.

The remaining issues

47.	The Tribunal, having concentrated upon the issue raised by reg 5(4), have not dealt explicitly with the other issues raised by reg 5.  For reasons which we will explain we have concluded that these issues will have to be remitted to a Tribunal for consideration.  But we heard submissions on, and will seek to give guidance to the Tribunal upon, certain aspects of those issues.

Application of the pro-rata principle: Issue 1(A) and (B)

48.	It is convenient first to consider whether and to what extent the pro rata principle may apply in determining whether GNER treat their part-time workers less favourably than their comparable full-time workers with regard to the additional hours allowance. 

49.	The starting point is that the pro rata principle is to be applied unless it is inappropriate: r. 5(3).  But there are limits to its application.  In its own terms it applies only to “pay or any other benefit”.  The 2002 Regulations apply, of course, to discrimination over a wider field.  Moreover, not all forms of pay or benefit will be susceptible of its application.  In Matthews and ors v Kent & Medway Towns Fire Authority [2003] IRLR 732 the Tribunal held that it was inappropriate to apply the pro rata principle over the whole range of a financial package for fire fighters which included pension benefit, sick pay and pay for additional duties.  This conclusion was not challenged in the Appeal Tribunal.  

50.	A Tribunal addressing itself to r. 5 should always consider whether it appropriate to adopt the pro rata principle.  A Tribunal should bear in mind that the fundamental purpose of the pro rata principle is to enable a valid comparison to be made between the remuneration of a part-time worker and his full-time counterpart, so as to identify whether a part-time worker is being treated less favourably and if so to what extent.   It is a tool for determining whether a part-time worker has been treated less favourably than a full-time employee: see r. 5(3).  It will generally be a useful exercise for a Tribunal to consider carefully how the pro rata principle might apply to the case before it.

51.	We ourselves heard submissions on the application of the pro rata principle to the additional hours allowance.  We think it may be helpful to the Tribunal if we set out those submissions, and certain conclusions which we have reached.

52.	It is important to bear in mind that GNER’s additional hours allowance may produce two kinds of less favourable treatment for its part-time workers.  We have already discussed them.  Firstly, it may produce a difference in the remuneration for hours worked in the ordinary course of events.  In our illustration the difference was £0.31 pence per hour.  Secondly, it may produce anomalous differences – we refer, for example, to the suggestion that a full-time worker may be substantially better off than a part-time worker if GNER is unable to roster the full amount of hours.  It will be for the Tribunal to make findings as to both potential kinds of less favourable treatment – whether they exist, to what extent, and whether they are objectively justified.

53.	In our judgment the pro rata principle ought to apply to the first kind of less favourable treatment.  Indeed if it did not it is difficult to see what the scope for the pro rata principle would be.  It is much less clear whether the pro rata principle can be applied usefully to the occasional anomalies.  It will depend on the Tribunal’s findings as to what these anomalies are, and how often they are likely to apply in practice.  In this judgment we will concentrate on the way in which the pro rata principle may apply to the first kind of less favourable treatment.
54.	It is convenient first to consider what are the “weekly hours” which are to be adopted in applying the pro rata principle.  The definition of “weekly hours” is found in r. 1(3), which we have quoted above.  It means the number of hours a worker is required to work under his contract of employment in a week when he has no absences from work and does not work any overtime.  Where the number of such hours varies according to a cycle, it means the average number of such hours.

55.	Ms Eady submitted that the weekly hours of GNER’s full-time employees were to be taken as 35, not 40.  She said that the last 5 hours were to be regarded as overtime.  She relied on the history of the additional hours allowance, to which we have referred above.  She prayed in aid the Tribunal’s finding that the additional hours allowance was a combination of overtime and incentive.

56.	We are unable to agree.  It is in our judgment entirely plain that GNER’s full-time workers are required to work an average 40 hour week over an 8 week cycle.  As we have seen, if GNER require overtime it will be additional to the 40 hours rostered; if it is worked it is paid separately on the payslip.  The Tribunal, in describing the additional hours allowance as being a combination of overtime and incentive, is in our judgment describing the origins and purpose of the means of payment.  R. 1(3) directs a Tribunal to look at the present contract of employment.  Under this contract it is plain from the Tribunal’s own findings that GNER’s full-time staff are required to work an average 40 hour week over an 8 week cycle.  The weekly hours are therefore 40.

57.	We then turn to the manner in which the pro rata principle is to be applied.

58.	Ms Criddle submitted that the pro rata principle was to be applied to the additional hours allowance separately from the hourly rate of pay.  She submitted that in order to assess whether the claimants were being treated equally with male employees it was necessary to look separately at each aspect of remuneration received by them, “term by term”.  She cited Brunhoffer v Bank der Osterreichischen Postsparkasse AG [2001] IRLR 571 at paragraphs 35-37, and the recent decision of the Employment Appeal Tribunal in Matthews and ors v Kent & Medway Towns Fire Authority [2003] IRLR 732 at paragraph 71.

59.	We return to the illustration which we have already given in this judgment.  If the pro rata principle is applied to the wages of the full-time worker and his part-time counterpart as a whole, the difference identified is £0.31 pence per hour.  That is the difference GNER would have to justify.

60.	But if the pro rata principle is applied to the additional hours allowance in isolation from other wages, the difference between the full-time worker and the part-time counterpart working 30 hours would apparently be 30/40ths of £62.50, the value of the additional hours allowance at £10 per hour in line with the illustrative calculation in paragraphs 19 and 20.  The question for the Tribunal would be whether GNER could justify this difference.  But the question would be completely unreal and impractical.  The claimants would effectively be claiming to be paid at a much higher hourly rate than their full-time counterparts.  

61.	Applying the pro rata principle to the additional hours allowance in isolation from other wages would leave out of account the reality that the additional hours allowance is the only payment for the final 5 hours of the full-time worker’s week.  So, on the particular facts of this case, we reject Ms Criddle’s submission; the pro rata principle cannot sensibly be applied to the additional hours allowance in isolation from basic pay.  
62.	As we have said, the fundamental purpose of the pro rata principle is to enable a valid comparison to be made between the remuneration of a part-time worker and her full-time counterpart, so as to identify whether a part-time worker is being treated less favourably and, if so, to what extent.  It is a statutory tool to be used where appropriate for this purpose.  In the illustration we have given, it would correctly identify the true difference – which would have to be justified – as £0.31 per hour.  

Justification

63.	Ms Eady sought to persuade us that the Tribunal’s conclusion on the question of objective justification could be spelt out from its Decision, although it did not specifically address the issue.  She submitted that the reasons for the additional hours allowance were objectively justified, and that any anomalies were not “real world” cases.

64.	Ms Criddle submitted, on the other hand, that the additional hours allowance produces less favourable treatment for part-time employees which was unjustified.  She pointed out that part-time employees often worked as much as 30 rostered hours per week, and still had an obligation to work overtime.  She did not accept that anomalous cases where the additional hours allowance worked in the full-time worker’s favour were not “real world”.

65.	The Appeal Tribunal is concerned with questions of law.  The question whether less favourable treatment between GNER’s full-time workers and part-time workers, once it has been correctly identified, is justified on objective grounds is a matter for a Tribunal to decide.   The Tribunal, because it relied on r. 5(4), did not identify whether and to what extent there was less favourable treatment, still less whether it was justified on objective grounds.   We do not think we can or should resolve this question on appeal. 
Remission

66.	It was submitted on behalf of the claimants that the better course was to remit to a fresh Tribunal.  It was submitted on behalf of GNER that there should be what was described as a “controlled remission” to the same Tribunal on the basis of evidence already adduced and submissions already made.  

67.	We were informed that the hearing before the Tribunal was short.  It is now some months since it took place.  The Tribunal, because it concentrated on rule 5(4) and the principle in Stadt Lengerich v Helmig, made only limited findings of fact.

68.	In our judgment it is better in this case to remit the claims to a fresh Tribunal which will be in a position to make findings as to the figures and anomalies, hear evidence and submissions on the question of justification, and reach a conclusion afresh.  We have concentrated in this judgment on the Part-time Workers Regulations.  It will also be for the Tribunal to consider the Equal Pay Act; but, as we have said, we do not think an analysis in terms of the Equal Pay Act should lead to any different conclusion.