C-167/97

B — The national legal framework I - 629

III — Facts I - 632

IV — Questions referred for a preliminary ruling I - 633

V — Reply to the questions referred I - 634

A — Preliminary remarks concerning the first two questions I - 634

B — Question 1 I- 635

G — Summary I - 664

VI — Conclusion I - 665

* Original language: Greek.

I - 626

R v SECRETARY OF STATE FOR EMPLOYMENT, EX PARTE SEYMOUR-SMITH AND PEREZ

I — Introductory remarks under what circumstances may such treat­ ment be objectively justified) and also whether the award of compensation, provided for, inter alia, under the same United Kingdom legislation as a sanction for unfair or unlawful dismissal, constitutes 'pay' under Article 119 of the Treaty, or whether it falls under Direc­ 1. The House of Lords has referred to the tive 76/207. Court of Justice for a preliminary ruling five questions on the interpretation of Article 119 of the Treaty and the provisions of Council Directive 76/207/EEC of 9 February 1976 on the implementation of the principle of equal treatment for men and women as regards II — Legal framework access to employment, vocational training and promotion, and working conditions. 1

(b) that pay for work at time rates shall be the same for the same job.' 7. Article 2(1) of Directive 76/207 provides that the principle of equal treatment is to mean that 'there shall be no discrimination whatsoever on grounds of sex either directly or indirectly by reference in particular to marital or family status'. 5. That article was given detailed expression by Council Directive 75/117/EEC of 10 Feb­ ruary 1975 on the approximation of the laws of the Member States relating to the applica­ tion of the principle of equal pay for men and 2 women.

8. Article 5 of the directive states:

Article 1 of Directive 75/117 lays down in particular that that principle means, for the same work or for work to which equal value is attributed, the elimination of all discrimina­ tion on grounds of sex with regard to all aspects and conditions of remuneration, without, however, in any way altering the content or scope of that principle as defined 3 in Article 119 of the Treaty. '1 . Application of the principle of equal treatment with regard to working conditions, including the conditions governing dismissal, means that men and women shall be guaran­ 2 — OJ 1975 L 45, p. 19. teed the same conditions without discrimina­ 3 — Sec, for example Case 96/80 Jenkins v Kingsgate [1981] ECR 911, paragraph 22. tion on grounds of sex.

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R v SECRETARY OF STATE FOR EMPLOYMENT, EX PARTE SEYMOUR-SMITH AND PEREZ

2. To this end, Member States shall take the 11. At the time material to the facts in the measures necessary to ensure that: main proceedings, the right of employees not to be unfairly dismissed was governed by sec­ tions 54 to 80 of the Employment Protection (Consolidation) Act of 1978 (hereinafter 'the 4 1978 Act'), as amended in 1985.

I-629

OPINION OF MR COSMAS — CASE C-167/97

Where the employer has fulfilled the require­ period of dismissal, seniority, date by which ments of subsection 1, the determination of the order must be complied with by the the question whether the dismissal was fair or employer, and so forth (section 69(4)). unfair is to depend essentially on the specific circumstance, including the size and admin­ istrative resources of the undertaking, in accor­ dance with equity and the substantial merits of the case (subsection 3).

(c) Lasdy, where the above solutions are not appropriate or are unlikely to be successful, the tribunal may make an award of compen­ sation for unfair dismissal (section 68(2)).

I-630

R v SECRETARY OF STATE FOR EMPLOYMENT, EX PARTE SEYMOUR-SMITH AND PEREZ

Act 1975 which is unlawful by virtue of that As the evidence adduced by the parties shows, Act' (subsection 3(b)), and also that temporal restriction was first introduced by the Industrial Relations Act 1971 (section 28) when it was set at 104 weeks (approxi­ mately two years).

'a dismissal which is an act of discrimination within the meaning of the Race Relations Act In 1974 the Trade Union and Labour Rela­ 1976' (subsection 3(c)). tions Act 1974 repealed the above Act, but reintroduced protection of employees against unfair dismissal, laying down the relevant qualifying period as one year, which subse­ quently became (under the Labour Govern­ ment) 26 weeks.

17. The right not to be unfairly dismissed, however, is subject to a significant condition as to time. Section 64 of the Act, as amended by the Unfair Dismissal (Variation of Quali­ 5 fying Period) Order 1985, provides that sec­ The 1978 Act retained the period of 26 weeks. tion 54 is not to apply to the dismissal of an employee from any employment if the employee was not continuously employed for a period of not less than two years ending with the effective date of termination.

In 1979, under a Conservative Government, the Unfair Dismissal (Variation of Qualifying Period) Order 1979 doubled the qualifying period, extending it to one year.

22. Laura Perez commenced employment on III — Facts 19 February 1990 with M. S. Restoration Limited as an office manager/personal assis­ tant to one of its directors. According to the applicant, that director was satisfied with her performance and had repeatedly promised that he would give her various benefits, including shares in the business and the posi­ tion of company secretary in a new company 19. As the documents in the main proceed­ which was being set up. The company was in ings relate, Nicole Seymour-Smith started fact set up, but the applicant was not given work on 1 February 1990 with C. & Co . the position of company secretary or shares Estate Agents as a secretary. After about two in the company, whereupon she complained months, according to the applicant, her to the director. A few days later, the applicant employer began to treat her in a humiliating went on leave but when she returned on 25 way. Inter alia she alleges that after the cleaner March 1991 the director gave her notice. was dismissed he required her to clean the office, maintaining that that formed part of her duties as a secretary and that it was 'women's work' inappropriate for the male staff in the office to perform. He also called her offensive names in front of the other staff. The applicant was subsequently dismissed on 23. Consequently the second applicant com­ 1 May 1991. plained to the Industrial Tribunal, claiming that her dismissal was unfair and seeking compensation from her former employer.

20. Accordingly, in her complaint to the 24. The Central Office of Industrial Tribu­ Industrial Tribunal, the applicant sought a nals informed her by letter that it would not declaration that her dismissal was unfair and register her complaint because she had not an order that the employer pay her compen­ been employed for more than 2 years as was sation. required under the 1985 Order.

26. The applicants argued before the Divi­ sional Court that the above two-year rule was indirectly discriminatory as regards women and that it was not objectively justified. In that connection they relied on statistical evi­ 29. On appeal, the House of Lords decided dence from which it appeared that over the to set aside in part the Court of Appeal's period 1985 to 1990 the percentage of women decision. Since it entertained doubts as to the who did not fulfil the two-year requirement classification and lawfulness of the national was greater than the equivalent percentage of measure in question from the point of view men. The Secretary of State did not dispute of Community law, it referred the following those statistics, but maintained that they did questions to the Court of Justice for a pre­ not show that the rule was discriminatory liminary ruling: and that in any case it was objectively justi­ fied on grounds of social policy, consisting in making it easier for employers to take on more staff.

IV — Questions referred for a preliminary ruling

27. On 20 May 1994, the Divisional Court '1 . Does an award of compensation for dismissed the application, holding that the breach of the right not to be unfairly 1985 Order did not constitute discriminatory dismissed under national legislation such treatment of women contrary to Directive as the Employment Protection (Consoli­ 76/207; if, however, that had been the case, dation) Act 1978 constitute "pay" within no objective grounds capable of justifying the meaning of Article 119 of the EC discrimination had been put forward. Treaty?

30. The first question asks whether compen­ sation for unfair dismissal, such as that pro­ a vided for under the 1978 Act, constitutes 'p y' within the meaning of Article 119 of the (a) when the measure is adopted; Treaty. The second question asks essentially, whether the conditions governing the right not to be unfairly dismissed, including a quali­ fying period such as that in issue, fall within the scope of Article 119 or Directive 76/207.

(b) when the measure is brought into force;

31. From a comparison of the two questions, in conjunction with the provisions of the 1978 (c) when the employee is dismissed? Act set out above and the facts in the main

I - 634

R v SECRETARY OF STATE FOR EMPLOYMENT, EX PARTE SEYMOUR-SMITH AND PEREZ

proceedings, it appears that the issues raised B — Question 1 in the first two questions are different and that from a logical and legal point of view consideration of the second question should precede that of the first.

I - 635

OPINION OF MR COSMAS — CASE C-167/97

employment from his employer; consequently nated by the employer. Consequently the the fact that certain benefits are paid after the basis of that compensation is also the employ­ termination of the employment relationship ment relationship. does not prevent them from being in the nature of pay, within the meaning of Article 119 of the Treaty. In particular, compensation paid by an employer to an employee in respect of his dismissal on economic grounds is a form of deferred pay to which the worker is 9 Case 149/77 Defrenne III, on which the entitled by reason of his employment but United Kingdom Government relies, does not which is paid to him on termination of the provide an argument in support of its point employment relationship with a view to of view. In that judgment, it was held that a enabling him to adjust to the new circum­ condition of employment, such as the setting stances arising from such termination. Accord­ of an age-limit after which employment would ingly, such compensation falls within the scope be terminated, did not fall under Article 119 8 of Article 119 of the Treaty. of the Treaty (paragraph 24). That issue will arise, however, in the context of the second question rather than this question, which does not relate to a condition governing dismissal but to compensation, in other words, according to the Court's case-law on the sub­ ject, to deferred pay. 37. For the same reason, compensation awarded by an employer to an employee in respect of unfair dismissal, as in the present case, constitutes, in the broad sense, 'pay' which falls within the scope of Article 119. C — Question 2

possibility of relying on Article 119 would of objective criteria, in the light, on the one allow them to assert a right to compensation hand, of the particular scope of each Com­ directly against their employer. That could munity rule which falls prima facie to be not be done by means of Directive 76/207, a applied, and, on the other hand, of the nature fact which would deprive the principle of the of the national measure at issue and the facts prohibition of discrimination of any practical of the particular dispute. Consequently no effect. account is taken of subjective considerations, such as which rule offers the more effective means to achieve the result that the indi­ viduals concerned envisage. That applies irre­ spective of the fact that the following analysis will show, I believe, that the national measure at issue is directly, and indeed manifoldly, 40. The Commission puts forward a similar contrary to Directive 76/207 which, more­ view. In addition it points out that the condi­ over, provides almost as effective means as tions under which an employee becomes enti­ Article 119 to remedy the situation in which tled to compensation, such as, in this case, the applicants found themselves. where there is a right not to be unfairly dis­ missed, fall under Article 119. Conversely, other situations, such as, for example, rein­ statement or re-engagement of the dismissed employee, fall under Directive 76/207.

In these circumstances it is impossible to extend the scope of that article to elements of 47. In Case 19/81 Burton, the Court was the employment relationship other than those asked 'whether a condition that a male expressly referred to. employee must have reached the age of 60 before he was entitled to voluntary redun­ dancy benefit, whereas women were so enti­ tled at the age of 55, constituted discrimina­ tion on grounds of sex and if so which Community provisions governed the situa­ 12 In particular, the fact that the fixing of certain tion. In its judgment, the Court stated: working conditions — such as a special age- limit — may have pecuniary consequences is not sufficient to bring such conditions within the field of application of Article 119, which is based on the close connection which exists between the nature of the services provided 1 and the amount of remuneration.' 1 "... the question of interpretation which has been referred to the Court concerns not the benefit itself, but whether the conditions of access to the voluntary redundancy scheme are discriminatory. That is a matter covered by the provisions of Directive 76/207 ... and 46. From that judgment it follows that the not by those of Article 119 of the Treaty or Treaty requires only the first form of equality, Directive 75/117' (paragraph 8).

11 — Paragraphs 19, 20 and 21. Sec also Case C-1/95 Geraer [1997] ECR I-5253, paragraph 21 et scq. 12 — [1982] ECR 555.

I-638

R v SECRETARY OF STATE FOR EMPLOYMENT, EX PARTE SEYMOUR-SMITH AND PEREZ

Subsequently the Court gave consideration to — the dismissal of an employee by a State the question in the context of Article 5 of the authority on the ground that she had Directive, stating that: reached or gone beyond the statutory 14 retirement age for civil servants;

— the dismissal of an employee when she 14 — Case 152/84 Marshall v Southampton and South-West Hamp- reached a certain age in connection with a shire Area Health Authority (Teaching) [1986] ECR 723, paragraphs 32 to 34. mass redundancy caused by the closure of 15 — Case C-13/94 P v S and Cornwall County Council [1996] 13 part of an undertaking's plant; ECR I-2143, paragraph 12. It should be noted that in that case, despite the fact that the dismissal took place in December 1992, after the completion of one and a half years' employ- ment, the Industrial Tribunal which referred questions to the Court for a preliminary ruling examined the substance of the case and considered whether the dismissal constituted 13 — Case 151/84 Roberts v Tate & Lyle [1986] ECR 703, para- discrimination on grounds of sex, without raising the issue graphs 30 to 32. of the qualifying period as was done in this case.

I-639

OPINION OF MR COSMAS — CASE C-167/97

Even if the two-year qualifying period intro­ duced indirect discrimination, as the appli­ cants and the Commission maintain, the legal 51. That argument requires a series of impos­ consequence, in accordance with settled case- sible logical and legal leaps. law, would be the setting aside of the defec­ tive provisions and the restitution of the equality encroached upon, by granting to the group who have suffered discriminatory treat­ ment the right granted to the advantaged 16 group. That right, as set out above, is not that dismissal is automatically unfair, but that it should take place on lawful grounds, which 52. First, it is not true that, in the specific cir­ are subject to review by the competent court. cumstances, any infringement by the two- Consequently the most that the applicants year rule against Community law automati- may gain by a declaration that the provisions cally entails the applicants' dismissal being at issue introduced indirect discrimination is, unlawful and hence payment of compensa­ essentially, consideration by the competent tion. court of the merits of their dismissal; only if, and provided that, the court held their dis­ missal to be unfair, would they be entitled to compensation under the Act. Any recogni­ tion that the group to which the applicants belong have a right greater than that granted

The contested provision, as stated above, excludes employees who have served less than 16 — See, for instance, Kowalska, cited in footnote 6, paragraph two years, such as the applicants, from the 20; Case C-184/89 Nimz [1991] ECR I-297, paragraph 21; and Case C-200/91 Coloroll[1994] ECR I-4389, paragraph rule applied to other employees. 29, and so forth.

Certain judgments appear to extend the meaning of 'pay' to include the conditions or the system by means of which pay is earned. Thus in Barber, cited above, the Court, having held that a pension paid under a 53. From the preceding argument it follows 'contracted-out scheme' constituted pay under that even if the compensation to which an Article 119 of the Treaty (paragraph 28), sub­ employee is entitled for unfair dismissal does sequently held that the imposition of an age constitute 'pay' for the purposes of Article condition which differed according to sex was 119 of the Treaty, nevertheless it bears merely contrary to that article, because 'Article 119 an indirect relation to the requirement as prohibits any discrimination with regard to regards dismissal, which constitutes the sub­ pay as between men and women, whatever ject of the second question referred to the the system which gives rise to such inequality' Court. As has already been held in Defrenne (paragraph 32, emphasis added). III, the fact that certain working conditions have financial consequences does not suffice to make Article 119 of the Treaty applicable to them.

55. From those judgments, however, the con­ tion falls under Article 119 of the Treaty does clusion cannot be drawn that the Court has not affect the nature of the latter right as a so broadened the definition of 'pay' that all condition governing dismissal which falls working conditions or advancement in under Directive 76/207. Accordingly, the ques­ seniority are covered by the term. That is tion whether denying employees who have because, as the Court has clarified, moreover, not completed two years' employment the in its subsequent case-law, account was prin­ right not to be unfairly dismissed constitutes cipally taken in those judgments of the direct discrimination against women must be decided and practically automatic link of the criterion on the basis of the provisions of Directive in question with pay, a link which made it 76/207 rather than Article 119 of the Treaty. possible to include the criterion in a broad definition of pay.

I-642

R v SECRETARY OF STATE FOR EMPLOYMENT, EX PARTE SEYMOUR-SMITH AND PEREZ

60. The applicants maintain that the measure The Commission takes basically the same introduces indirect discrimination against view as the applicants, but makes a side refer­ women. That is because, from statistical evi­ ence to an American-inspired system for dence relied upon before the United Kingdom reviewing statistics and determining whether courts it appears, in their view, that the con­ there is any indirect discrimination which tested measure may affect more women than does not, however, appear to be in keeping men, since the percentage of women with less with the settled case-law of the Court on than two years' employment in relation to those questions. the total percentage of the female working population appears greater than the percentage of men with a corresponding period of employment in relation to the total percentage of working men. According to the applicants, moreover, the contested measure is not objec­ tively justified.

61. I take the view that the basis on which the applicants and the Commission place the question, and which the United Kingdom accepts, is not correct. That is not only — or rather not so much — because the contested measure itself does not appear to introduce a distinction, or discrimination, to the detri­ ment of women employees, either by its nature or by its results. In my view the measure is contrary to Directive 76/207 but for a more fundamental reason.

E — My views on the case 67. With the successive extensions, in par­ ticular the last, a further purpose was given prominence. As is clear from the evidence available, and from the grounds set out in the measure at issue, the extension of the quali­ fying period to two years was considered 64. First of all, the nature of the two-year expedient in order to encourage employers to rule at issue must be more closely examined recruit new staff. On that view, when the in the context of the 1978 Act, in particular qualifying period is short, employers hesitate its aim and function. to take on new staff because they are afraid that they will become embroiled in legal actions and will be obliged to pay compensa­ tion to employees whom they might have to dismiss after a short qualifying period. Con­ versely, on the same view, if the employer 65. As is shown by the file on the case, knows from the outset that he has a longer including the Parliamentary debates on the period available to decide whether to keep on extension of the qualifying period to two an employee he will be more prepared to years, which took place in 1985, the provision recruit staff, in the knowledge that there is a to that effect in the Act pursued, over the longer period within which he may dismiss years, two basic objectives. them without having to suffer any conse­ quences.

66. The first was to give an employer a rea­ sonable period to assess the capacities and 68. From all the foregoing, the conclusion productivity of the employee in order to must be drawn that the successive extensions decide whether he was able to satisfy the and reductions in the qualifying period were requirements of the job for which he had been part and parcel of the policy of each govern-

69. At this point a clarification is necessary. It is true that, according to the case-law, where a measure which introduces discrimi nation is 'objectively justified' it is not con 19 trary to the principle of equal treatment. In this case, however, there is no question of reviewing 'objective justification'. In fact such That, moreover, was the case with the adop review arises at a later stage, that is to say, tion of Directive 76/207 which, as concerns once it has been found, in accordance with working conditions, did not have its basis in the criteria laid down in the case-law, that the a specific provision of the Treaty (see the third measure under consideration does introduce recital in the preamble), and therefore cited discrimination. Conversely, clarification of the the general Article 235 as its legal basis (see nature and purpose of a measure such as that the first citation in the preamble). at issue is of significance at the present stage of the investigation because it is connected to the extent to which the national measure is of 20 — See, inter alia, Defrenne III, cited in footnote 9, paragraph concern to Community law and, consequendy, 19; Case 126/76 Zaera [1987] ECR 3697, paragraph 14; and Joined Cases C-72/91 and C-73/91 Sloman Neptun [1993] the extent of the review to be carried out by ECR I-887, paragraph 25. However, those articles are not devoid of any legal effect but constitute an important aid for the Court. the interpretation of other provisions of the Treaty and of secondary Community law in social matters (see the latter two judgments, at paragraphs 14 and 26 respectively). 21 — See Zaera, cited in the preceding footnote, paragraph 14, and Sloman Neptun, paragraph 26. Sale also Case C-343/92 De Weerd and Others [1994] ECR I-571, paragraph 28; Case C-317/93 Nolte [1995] ECR I-4624, paragraph 33; Case C-444/93 Megner [1995] ECR I-4741, paragraph 29; Case C-280/94 Posthuma [1996] ECR I-179, paragraph 26.

Nev- means of exercising government policy and is ertheless, there must be no going to the other extreme, to reach a situation where, by means of Community provisions ultimately a political choice, it falls within the of specific and restricted scope, the policy of the Member States could be reviewed, and possibly overturned, in areas scope of Articles 117 and 118 of the Treaty. where the Community had not as yet wished to legislate (see Those articles, as the Court has repeatedly Defrenne III, cited in footnote 9, paragraph 32; Case 170/84 Bilka [1986] ECR 1607, paragraph 42, and others). held, are simply in the nature of a pro 22 — See Case 43/75 Defrenne II [1976] ECR 455, paragraph 63. From this point of view, notwithstanding the difficulties and complexities of the matter, I would observe that the Com- munity could have undertaken a global examination of the problem of working conditions, having regard to its obvious 19 — See point 118 below. repercussions on the achievement of the internal market.

74. The measure at issue has two dimensions. A substantive dimension, whereby it is per­ 72. Where a measure, such as that at issue, is mitted to dismiss unfairly employees with less in part subject to Community law, in my view than two-years' employment, even on grounds the Court has an obligation to review the referable to their sex, and A procedural dimen­ measure to that extent and the consequences sion, whereby dismissal within the above of any infringement of the principle of equal period gives employees no entidement to legal treatment will be commensurate. In that case, protection even if they consider their dis­ in other words, a ruling finding an infringe­ missal to be the result of discrimination on ment and its consequences must be confined grounds of sex. Accordingly the contested measure is, on the first point, directly con­ trary to Article 5 of Directive 76/207 (see below under (a)), and on the second point is 23 — Council Directive 75/129/EEC of 17 February 1975 on the directly contrary to Article 6 of that directive approximation of the laws of the Member States relating to collective redundancies (OJ 1975 L 48, p. 29). (see below under (b)).

I-646

R v SECRETARY OF STATE FOR EMPLOYMENT, EX PARTE SEYMOUR-SMITH AND PEREZ

76. As has been consistently held, Article 5(1) of the directive is sufficiently precise and unconditional to be capable of being relied 78. The contested measure provides that the upon by an individual before a national court right not to be unfairly dismissed is not as against the State in order to exclude the enjoyed by employees who have not com­ application of any national provision which pleted two years' continuous employment for 24 does not conform to that article. In addi­ the same employer. In other words, by intro­ tion it must be accepted that Article 5(2), cited ducing an exception to the fixed rules, it above, also has the same character. enables the employer to dismiss an employee without having to give a reason provided the employee has not yet been employed for two years. According to the applicants' written observations, the Act expressly introduces certain exceptions to the above exception, with the consequence that there is a return to 77. In this case the 1978 Act lays down, in its the rule (that is to say, application of the fixed fixed provisions, the right of employees not to provisions which do not provide for a quali­ be unfairly dismissed. Formulated differently, fying period). Those cases are, for instance, dismissal because of union activities (section 58(1)), dismissal because of pregnancy, mater­ nity and so forth. Among those exceptions 24 — Case 152/84 Marshall I [1986] ECR 723, paragraphs 52 and 55; Case C-188/89 Foster and Others [1990] ECR I-3313, there do not appear to figure grounds refer­ paragraph 21; Case C-345/89 Stoeckel [1991] ECR I-4047, paragraph 12. Moreover, Article 5(1) may be pleaded against able to sex, and neither the United Kingdom a public sector body in order to obtain compensation for Government nor the other parties who have infringement of the directive (Foster, paragraph 22). It may not, however, be relied upon against private employers submitted observations make any assertion except when the employer is the State (Marshall I, paragraph 48). to the contrary. Consequently, by contrary

79. Such a construction is, however, directly contrary to Article 5(1) of the directive. That conflict is fundamental and does not depend 81. Secondly, that conflict is direct and easily on the facts of each case nor is there a need ascertainable on the basis of legal consider­ 25 for indirect evidence. In particular: ations alone. Consequently, there is no need for anyone to have recourse to indirect evi­ dence, that is to say to the investigation of statistical evidence which might reveal which sex is comparatively most adversely affected. Let us in fact imagine that the relevant statis­ tical evidence over a certain period does not 80. First, it does not depend on whether the show a 'large' or 'considerable' disparity in employee wronged is a woman or a man, percentage terms between the sex affected and given that equal treatment concerns both that not affected, or shows that both sexes are women and men. A male employee could similarly affected. Should we conclude in such equally well find himself in a position analo­ a case that the national measure is consistent gous to that of the present applicants as the with the directive? following example will show. Let us suppose that, because the messenger who delivered documents, supplies and so forth in the first applicant's company has retired, the manager allocates that work to a newly-engaged male administrative employee despite the fact that there are women available at the same level or lower than him, on the ground that it is a man's work; because he protests, the employee The answer is certainly no. A national mea­ is dismissed. Proceedings in which the sure which, on a proper construction, allows employee concerned complains that he has an employer to dismiss an employee on suffered discrimination on grounds of sex are grounds referable to sex may in no way be rejected as inadmissible, in reliance on the legitimated by the fact that there is no sig­ measure at issue. How can the employee in nificant disparity between the percentages of question protect himself? Should he perhaps men and women employees affected. argue that the two-year qualifying period adversely affects him because it works to the detriment of women, and should the question whether the complaint is well founded depend 25 — In that respect, it is similar to direct discrimination on grounds of sex.

85. According to a statement made during the hearing by the Agent of the United Kingdom, which was not disputed, the appli­ 83. I should like to enlarge somewhat upon cants are seeking to have the measure at issue that point because the impasse to which the set aside as contrary to Community law so solution of 'indirect discrimination' being that the one-year qualifying period applicable pressed upon us by the parties leads will thus before 1985 will apply to them. 28 That, of become more apparent. course, is understandable, in view of the fact that these particular applicants, who were employed for a period longer than one year, 29 would benefit from such an outcome, since each applicant's dismissal could finally be assessed on the merits by the Industrial Tri­ bunal, and a decision reached as to whether it was unfair, on the same conditions as apply 84. As is clear from the background to the to employees who have been dismissed after case and the hearing, after the Industrial Tri­ two years' employment. bunal had refused to register the applicants' complaints, the procedure before the other United Kingdom courts took on the char­ acter of a collateral review of the compliance 28 — It should be pointed out, however, that the same Agent, when asked wnether that would in fact be the consequence of the national measure with Community law. in domestic law or whether, on the contrary, there would no The applicants are challenging the validity of longer be any qualifying period, stated that he did not know. 29 — Despite the fact that there is no evidence concerning the size of the undertakings in which the applicants were employed, it must be presumed that they employed more than 20 per- sons. Before 1985 in fact, the qualifying period was two years for employees in small undertakings (less than 20 per- 26 — See Case C-180/95 Draehmpaehl v Urania Immobilienser¬ sons) and one year for employees in large undertakings vice [1997] ECR 2195, paragraph 24, which concerned com- (above 20 persons) — see point 18 above. If the applicants pensation in a case where a male job applicant had not been were employed in a small undertaking they would not have selected on grounds of his sex. challenged the 1985 Order because if it was set aside and the 27 — See point 47 above. previous rule revived that would not help them at all.

If, however, the requirement at issue had the same repercussions, by analogy, both before 1985, when the qualifying period was one year, and after 1985, when it was extended to two years, then the problem does not lie in the specific length of the qualifying period but in the fact that it was Uid down at all. That finding, regardless of any other possible reper­ 30 cussions, supports, I believe, the view put 88. As has been held, Article 6 of the direc­ forward above, because it indicates that the tive requires the Member States to take suf­ problem with the rule at issue is more fun­ ficiently effective measures to achieve the aim damental and goes beyond the framework in of the directive, so that the persons concerned which the applicants seek to confine it. may profitably rely on those measures before national courts. In addition, that article con­ stitutes the expression of a general principle of law underlying the constitutional tradi­ tions common to the Member States which is also laid down by Articles 6 and 13 of the Convention for the Protection of Human 87. Moreover, if the defect in a measure such Rights and Fundamental Freedoms of 4 as that at issue lies in the adoption of a quali­ November 1950. By virtue of Article 6 of the fying period per se, the adoption of a quali­ directive, interpreted in the light of that prin­ ciple, all persons have the right to obtain an effective remedy in a competent court against measures which they consider to be contrary 30 — If the Court adopted the applicants' views, it would, sooner to the principle of equal treatment laid down or later, be called upon to review the requirement of one 31 year (not to mention the intermediate system which applied in Directive 76/207. prior to 1985 in respect of employees in small ana large undertakings — see above, point 18), subsequently the sixth- month requirement, and so forth. That demonstrates, I believe, the absurdity of attempting to draw conclusions as regards the nature of a measure such as that at issue from statistics concerning its possible repercussions. 31 — Case 222/84 Johnston [1986] ECR 1651, paragraphs 17 to 19.

90. Thus, in Johnston, the Court held that a legal provision to the effect that a ministerial certificate stating that the conditions for dero­ 93. In the present case, the fixed provisions gating from the principle of equal treatment of the 1978 Act contain a complete system of for men and women for the purpose of pro­ legal protection and sanctions against tecting public safety was to be treated as con­ employers which, per se, is wholly consistent 33 clusive evidence was contrary to Article 6. with the directive. However, one category of dismissed employees cannot take advantage of it because of the procedural consequence of the measure at issue. As already explained, that procedural consequence consists in the fact that dismissed employees who have not completed two years' employment are not 91. However, the requirements of Article 6 entitled to appear before a court to claim that as regards real and effective judicial protec­ they have been the victims of discrimination tion mean that account must be taken of the on grounds of sex. For that reason such com­ particular circumstances of each breach of the plaints by dismissed employees to the Indus­ principle of equality. In particular, in the event trial Tribunal cannot be registered. In fact, as of discriminatory dismissal contrary to Article the court of reference emphasised, 'it is not 5(1) of the directive, it has been held that a disputed but that for the requirement of two situation of equality could not be restored or more years' continuous employment ("the without either reinstating the victim of dis­ two-year rule") the industrial tribunal would crimination or, in the alternative, granting have had jurisdiction to entertain the appli­ cants' claims'.

As is clear from the hearing, if the Court 95. That complication does not, however, finds the measure at issue to be contrary to affect us here. The protection of Article 6 Community law, the case will return to the would become a dead letter if the persons House of Lords which, in turn will refer the concerned could not put forward all the pleas case back to the Industrial Tribunal to be and arguments, substantive and procedural, heard on the merits. That means, at best, that on the basis of which they consider them­ the Industrial Tribunal will decide on the selves to be the victims of discrimination on validity of the applicants' dismissal approxi­ grounds of sex. Those arguments may be mately 10 years after the dismissals took place. legally or substantively without foundation, Thus it is not impossible that the applicants when they will be rejected by the court. They will meet with significant difficulty in proving may not, however, be regarded as inadmis­ the dismissals to have been unfair, since it sible in principle. In fact it does not make may be that the undertaking no longer exists, sense to reject an action or the submission of the relevant evidence may have been destroyed a particular plea as procedurally inadmissible and witnesses may have left their employ­ on the ground that precisely the legal require­ ment. In such circumstances there is the risk ment challenged by the action or plea is that the employees wronged will be discour­ lacking. That is to beg the question and leads aged from seeking legal protection. to a denial of legal protection.

more general principle mentioned above and 99. The consequence of the partial conflict of Article 177 of the Treaty. the measure at issue with Articles 5 and 6 of the directive is that the national courts will have to set it aside so that, on the one hand, proceedings brought by dismissed employees in which an issue of unequal treatment on grounds of sex arises will be held admissible and, on the other hand, the question whether each particular dismissal was due, directly or indirectly, to sex discrimination will be exam­ ined as to its merits. 97. It must be stressed, moreover, that the conflict between the measure at issue and Article 6 of the Directive is just as funda­ mental as the conflict with Article 5. Conse­ quently, for the reasons set out above (points 79 et seq.) it is not connected with the sex of 100. I do not regard as justified the fear any particular person affected, with the per­ expressed by the applicants that, because Arti­ centages of men and women employees or cles 5 and 6 do not have direct horizontal with a particular length of employment. effect, Directive 76/207 cannot be pleaded against the employer and, consequently, does not provide as effective a means as Article 119 37 of the Treaty.

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rejected that argument, holding that the ques­ measure pursues an objective outside the tion referred to it concerned the interpreta­ ambit of Community law and, consequently, tion of a directive that had already been outside the scope of Directive 76/207. transposed into national law and was designed to assist the national court in interpreting and applying the provisions at issue concerning the invalidity of contracts and mistake (para­ graph 9).

39 — See Dekker, cited in footnote 32, paragraph 10. 40 — Sec Case 109/88 Danfoss [1989] ECR 3199, paragraph 11.

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the SDA. In addition, as noted above (see year rule, with the consequence that the dis­ footnote 15), in Case C-13/94 P. v S., despite missed employee may complain to the com­ the fact that dismissal on account of gender petent court and seek satisfaction on the basis reassignment occurred before completion of of the fixed provisions of the 1978 Act, then two years' employment (paragraphs 3 and 4), the measure at issue cannot be regarded as the Industrial Tribunal examined the merits contrary to the provisions of Directive 76/207. of the case, apparently by reference to the That is because a legislative measure which, S. D . A. (paragraph 7). on the one hand, ensures that the dismissal of an employee within the qualifying period of two years may not take place on grounds of sex, and on the other hand organises a system of penalties against the employer and a system of full legal protection of the persons wronged by any discrimination on grounds of sex, Of course the questions whether the 1978 constitutes a general legislative measure which Act is applied in a particular way in relation lays down a condition governing dismissal to the S. D . A., whether the two Acts are applicable without distinction to men and applied cumulatively or not, whether the 1978 women. Such a measure is not contrary to 43 Act provides greater protection, and so forth, any provision of Directive 76/207. In that are for the national courts to decide. More­ case, the problem does not arise at the level over, the national courts will have to interpret of the Act but in practice; in other words the the national provisions adopted before and only issue is whether the criterion was applied after Directive 76/207 consistently with the in a manner which led in fact to discrimina­ 44 latter, and where this is not possible, disapply tion. 42 the national provisions.

contradistinction, what I believe to be the a national measure, albeit formulated in neu­ correct view, but also to cover the possibility tral terms, works to the disadvantage of far of the Court preferring to take that second more women than men. 46 course.

108. Given that, in the case of measures which 105. It should be recalled that, according to are, at first sight, neutral, it is difficult both to the applicants and the Commission, the mea­ identify possible discrimination and for those sure at issue entails indirect discrimination affected to furnish proof, the Court's case-law against women, since it concerns a compara­ has elaborated certain criteria concerning the tively greater number of women than men, detection of discrimination and the distribu­ and is not objectively justified. The United tion of the burden of proof. In addition, as Kingdom Government takes the contrary the Court has pointed out, identification of view. indirect or covert discrimination 'implies com­ parative studies of entire branches of industry and therefore requires, as a prerequisite, the elaboration by the Community and national 47 legislative bodies of criteria of assessment'.

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110. Moreover, in its judgment in Gerster, the case-law in the other areas as well, I would the Court applied the above case-law as it has first point to certain characteristics of the developed to a case falling under the scope of above case-law and then examine whether and Directive 76/207, namely a legislative provi­ under what circumstances it may be applied sion which put workers into a disadvanta­ to the present case. geous position if they worked part-time in relation to workers who worked full-time for the purposes of length of service with a view 50 to promotion.

112. Since the case-law concerning discrimi­ nation in respect of pay against employees 114. The case-law under examination is based working part-time constituted the model for on the finding that women employees 'because of household and family duties for which they are frequendy responsible, are not as able as 50 — Cited in footnote 11, paragraph 34, which refers to Bilka, men to organise their working time flex­ Rinner-Kühn and Lewark. In the intervening period the 52 Court had already imported that case-law into the area cov­ ibly'. That finding, which is a fact of ered by Directive 79/7 on the progressive implementation of common experience, is the objective founda­ the principle of equal treatment for men and women in mat­ ters of social security (OJ 1979 L 6, p . 24) (see Case C-229/89 tion for the assessment of indirect discrimina­ Commission v Belgium [1991] ECR I-2205, paragraph 13, with reference to Kowahka), which from then on was setded tion in the above situation. in that area too (see De Weerd and Others, cited in footnote 21). We may thus speak of a general principle running through Community social law in the area of equal treat­ ment of men and women. 51 — See wier alia, Lewark, cited in footnote 49, paragraph 28. 52 — See Danfoss, cited in footnote 40, paragraph 21.

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115. Consequently it must be determined cant difference' with regard to the following whether there is in fact different treatment of percentages: employees working full-time and those working part-time, or whether the difference complained of is only apparent. If the latter is the case, the investigation is concluded at that stage and there is no examination either of numerical facts or as to whether the mea­ 53 — in Case 171/88 Rinner Kühn, in the cat­ sure is objectively justified. egory of part-time workers 89% were 56 women and 11 % men.

53 — Case C-78/93 Helmig [1994] ECB. I-5727, paragraphs 23, 30 — in Case C-127/92 Enderby, 98 % of and 32. employees in the allegedly disadvantaged 54 — Bilka, cited in footnote 21, at paragraph 29. In my view, in order to determine whether there is a 'significant difference' in the percentages within a group, account should also be taken of the proportions in the other (advantaged) group. The advantaged group will have to show either the contrary tendency, or equal percentages, or the same tendency but 56 — Cited above, in footnote 49, paragraph 11, in conjunction much more weakly in relation to the first group. If the dif- with point 111(2) of the Report for the Hearing and point 31 ference in percentages is in fact identical or similar in both of the Opinion of Advocate General Darmon. groups, employees in both groups are receiving the same 57 — Cited in footnote 7, paragraph 13, in conjunction with point rather than unequal treatment (see the third and fourth cases 3 of Advocate General Darmon's Opinion. immediately below). 58 — Footnote 16, paragraph 12, in conjunction with Point II of 55 — Rinner-Kühn, cited in footnote 49, paragraph 12. the Report for the Hearing.

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category were women, whilst in the alleg­ 118. The fact that a provision is regarded as edly advantaged category there were fewer contrary 'in principle' or 'prima facie' to the women, or very slightly more women. principle of equal treatment means that it is presumed to be contrary to Community law provided it is not objectively justified, and examination of that question constitutes the final stage of the investigation. Thus, if the measure is objectively justified, 'the mere fact that the provisions affect far more women — in Case C-100/95 Kording, 92.5% of than men cannot be regarded as constituting 63 employees working part-time were wom­ an infringement of Article 119'. 60 en.

117. Moreover, in order that employees who are prima fade the victims of discrimination should not be deprived of any effective means of ensuring that the principle of equality is 120. Accordingly, in order to determine adhered to, the case-law shifts the onus of whether there is indirect discrimination in the proof, so that a measure which has in practice present case, consideration must first be given an adverse impact on substantially more mem­ to whether the provisions at issue foster bers of one or other sex is regarded as con­ unequal treatment as between two categories trary to Article 119 of the Treaty, unless the of employees and whether that affects a con­ party bearing that onus shows that the mea­ siderably higher number of women than men. 62 Only if the answers to those questions are in sure is objectively justified. the affirmative does the question arise of the existence of objective factors unrelated to any form of discrimination which may justify the 59 — [1993] ECR I-5535, paragraph 16, in conjunction with point 31 of the Opinion of Advocate General Lenz. 60 — Cited in footnote 45, paragraph 18. It should be noted that this judgment applies Directive 76/207. 61 — Case C-243/95 Hill [1998] ECR I-3739, paragraph 25. 63 — Rinner - Kühn, cited in footnote 49, paragraph 14, and Kording, 62 — See Enderby, cited in footnote 59, paragraph 14. cited in footnote 45, paragraph 26.

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difference in treatment that has been estab­ On the other hand, the percentage of men lished. 4 with more than two years' employment ('those advantaged') in relation to all men was, for the corresponding years: 77.4%, 73.4% and 74.5%, whilst the corresponding percentages for women were 68.9%, 65.6% and 67.4%.

122. As regards the second question, from the statistical evidence covering the period 1985-1991, relied on by the applicants and set out in the order for reference, the following is apparent: From those figures the applicants and the Commission conclude that women are com­ 65 paratively worse affected than men; the Court of Appeal reached the same conclu­ sion. Conversely, the United Kingdom Gov­ ernment considers that such a conclusion does The percentage of men with less than two not follow from those statistics; that view was years' employment ('those affected') in the also taken by the Divisional Court. entire male workforce was 22.6% in 1985 and progressively increased to 28 % in 1989, sub­ sequently reducing by degrees to 25.5% in 65 — It should be pointed out that the number of women affected 1991. In the same years the corresponding in addition, on which the applicants relied in their written observations and at the hearing, although deserving of sym- percentages of women with less than two pathy, cannot however be taken into consideration. That is years' employment in relation to working because the essentia] point here is the relationship between the percentages and not the absolute numbers per se. To cite population was 31 %, 34.5% and 32.6%. Aristotle: 'because nothing is called "great" or 'small' as such and by itself, but by comparison to another [thing] ... so the comparison must be to another [thing]; ... "great", "small" and the like signify not a quantity but a relation, because we consider them in relation to another [thing]; it is obvious, then, that these terms are relative' (Categories, 5b 64 — See Helmig, cited in footnote 53, paragraphs 23 and 25. 16-29).

124. First of all, the method by which the calculations are arrived at is not correct and does not permit the necessary comparisons. In reality, according to the above case-law, applied by analogy, it should be possible to deduce from the statistics, first, the propor­ Conversely, in the present case, the advantage tion in each group of male and female workers. given to the favoured group is not immedi­ Such evidence exists only for 1985, whereas ately determinable, but consists, as far as that for the remaining periods only the percentage group is concerned, in the obligation of the of those affected of each sex of the total employer (reflecting the right of those number of workers of that sex is given. If, employees) to give lawful reason for any dis­ however, the make-up of each group is missal and, as far as the other group is con­ unknown, it is not possible to draw a conclu­ cerned, in the employer's discretion to dis­ sion as to which sex is affected to a compara­ miss those employees without fair reason tively greater degree. From the evidence (reflecting those employees' lack of a right). adduced, it appears simply that, both before In that case, it is not known in advance how and after 1985, there was a stable relationship employers will exercise their discretion or between those affected and those not affected fulfil their obligation and consequently how per sex and that the factors giving rise from the measure will affect employees in practice. year to year to an increase or decrease in the percentage of one sex influence the percent­ ages for the other sex in approximately the same way.

there, in prinaple, be a question of indirect be 'discrimination on grounds of sex'. The discrimination against women. applicants repeatedly claimed that, in the light of the statistics which they had adduced, the measure at issue constituted such discrimina­ tion 'by its very nature'. I have expressed the view above, however, that statistics alone do not constitute proof, and a more objective foundation is required for a determination of 67 However, there can be no thorough examina­ unequal treatment. tion if account is not also taken of the reper­ cussions of the measure on the group which appears each time to be advantaged, taking the circumstances into account. In this case, the advantaged group appears to be the group of employees with two or more years' employ­ ment. If the results of the investigation of that 127. I come finally to the question of how group correspond to the figures for the group considerable the difference in the percentages affected, then the measure at issue cannot be is. The available evidence for 1985 shows as responsible for the statistical evidence adduced follows. Of a total of 18.73 million employed and the causes must be sought elsewhere. persons in the United Kingdom, 11.41 mil­ lion (or 61%) were men and 7.32 million (or 39%) women. Those who had been in employ­ ment for more than two years numbered 13.92 million, of whom 8.85 million were men (or 63.5%) and 5.07 million women (or 36.5%). Those who had been employed for Lastly, account must also be taken of the less than two years numbered 4.81 million, of repercussions of the measure as it applied whom 2.56 million (or 53.2%) were men and before 1985. That is because, if the percent­ 2.25 million (or 46.8%) women. ages turn out to be the same in the two cases, 66 as they do here, then, perhaps, it is not the measure's specific length of two years but the adoption of a qualifying period per se which gives rise to the problem.

ment as against men in the same category has be taken of the fact that those repercussions increased in relation to the corresponding are not instantaneous but require a certain percentage in the category of employees with period of time to manifest themselves. Con- more than two years' employment. It is, of sequendy the relevant point in time cannot be course, for the national court to assess the either when the measure was adopted or when evidence in question as well as any required the applicants were dismissed, as has been to be adduced in the future, as also the ques­ proposed in the present case. tion whether the difference complained of is so considerable as to indicate indirect dis­ 68 crimination against women. However, it is my personal opinion that a difference of that size is not so significant as to justify a finding that there is unequal treatment on the grounds of sex; at all events, it does not approach the 129. Furthermore, the measure was intro­ percentages in the light of which the Court duced (in 1985) six years before the appli­ 69 cants were engaged (1990). In those circum­ has held there to be indirect discrimination. stances, statistics concerning the repercussions of the measure in 1985 are of little use after such a long time.

134. Since the dispute in the main proceed­ ings concerns the interpretation of Directive 76/207 rather than Article 119 of the Treaty, 132. In view of the fact that the national court I do not consider that it is necessary to reply has better knowledge of the situation within to Question 1. In accordance with the solu­ the Member State in question, it is for that tion I have proposed, a distinction should be court to evaluate the extent to which the drawn between the aspects of a national mea­ national measure is justified from the above 72 sure, such as that at issue, which are of direct point of view. In the present case, however, concern to Community law and those which it is noted that no specific grounds and evi­ are not of direct concern (at least at present). dence capable of justifying objectively the I consider also, that, since the measure is con­ measure at issue are apparent from the file on trary to Directive 76/207 for fundamental the case nor were any adduced by the United reasons and regardless of the sex of the person Kingdom Government, apart from general affected, there is no point in examining reasons of social policy. whether, in the light of what is, in my opinion, insufficient and weak evidence, the measure introduces indirect discrimination in particular against women.

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