Regina v Secretary of State for Employment, ex parte Nicole Seymour-Smith and Laura Perez.
Date: 1999-02-09
23 According to settled case-law, the concept of pay, within the meaning of the second paragraph of Article 119, comprises any other consideration, whether in cash or in kind, whether immediate or future, provided that the worker receives it, albeit indirectly, in respect of his employment from his employer (see, in particular, Case 12/81 Garland v British Rail Engineering [1982] ECR 359, paragraph 5, and Case C-262/88 Barber [1990] ECR I-1889, paragraph 12).
24 The Court has also held that the fact that certain benefits are paid after the termination of the employment relationship does not prevent them from being in the nature of pay, within the meaning of Article 119 of the Treaty (Barber, cited above, paragraph 12).
25 As regards, in particular, the compensation granted by an employer to an employee on termination of his employment, the Court has already stated that such compensation is a form of deferred pay to which the worker is entitled by reason of his employment but which is paid to him on termination of the employment relationship with a view to enabling him to adjust to the new circumstances arising from such termination (see Barber, cited above, paragraph 13, and Case C-33/89 Kowalska [1990] ECR I-2591, paragraph 10).
26 In this case, the compensation awarded to an employee for unfair dismissal, which comprises a basic award and a compensatory award, is designed in particular to give the employee what he would have earned if the employer had not unlawfully terminated the employment relationship.
27 The basic award refers directly to the remuneration which the employee would have received had he not been dismissed. The compensatory award covers the loss sustained by him as a result of the dismissal, including any expenses reasonably incurred by him in consequence thereof and, subject to certain conditions, the loss of any benefit which he might reasonably be expected to have gained but for the dismissal.
28 It follows that compensation for unfair dismissal is paid to the employee by reason of his employment, which would have continued but for the unfair dismissal. That compensation therefore falls within the definition of pay for the purposes of Article 119 of the Treaty.
29 The fact that the compensation at issue in the main proceedings is a judicial award made on the basis of the applicable legislation cannot, of itself, invalidate that conclusion.  As the Court has already stated in this connection, it is irrelevant that the right to compensation, rather than deriving from the contract of employment is, for instance, a statutory right (see, to that effect, Barber, cited above, paragraph 16).
35 On that point it should be noted, as the Commission was right to point out, that where the claim is for compensation, the condition laid down by the disputed rule concerns access to a form of pay to which Article 119 and Directive 75/117 apply.
37 It would be otherwise if the dismissed employee were to seek reinstatement or re-engagement. In such a case, the conditions laid down by national law would concern working conditions or the right to take up employment and would therefore fall under Directive 76/207.
39 As the Court has consistently held, wherever the provisions of a directive appear, as far as their subject-matter is concerned, to be unconditional and sufficiently precise, those provisions may be relied upon by individuals against the State (see, in particular, Case C-188/89 Foster and Others [1990] ECR I-3313, paragraph 16).
40 With regard to Article 5(1) of Directive 76/207, which prohibits any discrimination on grounds of sex with regard to working conditions, including the conditions governing dismissal, the Court has already held it to be sufficiently precise to be relied upon by an individual as against the State and applied by a national court in order to prevent the application of any national provision which is inconsistent with Article 5(1) (see Case 152/84 Marshall I [1986] ECR 723, paragraphs 52 and 56).
45 It should be noted at the outset that the requirements of Community law must be complied with at all relevant times, whether that is the time when the measure is adopted, when it is implemented or when it is applied to the case in point.
52 Article 119 of the Treaty sets out the principle that men and women should receive equal pay for equal work. That principle excludes not only the application of provisions leading to direct sex discrimination, but also the application of provisions which maintain different treatment between men and women at work as a result of the application of criteria not based on sex where those differences of treatment are not attributable to objective factors unrelated to sex discrimination (see Joined Cases C-399/92, C-409/92, C-425/92, C-34/93, C-50/93 and C-78/93 Helmig and Others [1994] ECR I-5727, paragraph 20).
58 As regards the establishment of indirect discrimination, the first question is whether a measure such as the rule at issue has a more unfavourable impact on women than on men.
59 Next, as the United Kingdom Government was right to point out, the best approach to the comparison of statistics is to consider, on the one hand, the respective proportions of men in the workforce able to satisfy the requirement of two years' employment under the disputed rule and of those unable to do so, and, on the other, to compare those proportions as regards women in the workforce. It is not sufficient to consider the number of persons affected, since that depends on the number of working people in the Member State as a whole as well as the percentages of men and women employed in that State.
60 As the Court has stated on several occasions, it must be ascertained whether the statistics available indicate that a considerably smaller percentage of women than men is able to satisfy the condition of two years' employment required by the disputed rule. That situation would be evidence of apparent sex discrimination unless the disputed rule were justified by objective factors unrelated to any discrimination based on sex.
61 That could also be the case if the statistical evidence revealed a lesser but persistent and relatively constant disparity over a long period between men and women who satisfy the requirement of two years' employment. It would, however, be for the national court to determine the conclusions to be drawn from such statistics.
62 It is also for the national court to assess whether the statistics concerning the situation of the workforce are valid and can be taken into account, that is to say, whether they cover enough individuals, whether they illustrate purely fortuitous or short-term phenomena, and whether, in general, they appear to be significant (see Case C-127/92 Enderby [1993] ECR I-5535, paragraph 17). It is, in particular, for the national court to establish whether, given the answer to the fourth question, the 1985 statistics concerning the respective percentages of men and women fulfilling the requirement of two years' employment under the disputed rule are relevant and sufficient for the purposes of resolving the case before it.
63 In this case, it appears from the order for reference that in 1985, the year in which the requirement of two years' employment was introduced, 77.4% of men and 68.9% of women fulfilled that condition.
65 Accordingly, the answer to the third question must be that in order to establish whether a measure adopted by a Member State has disparate effect as between men and women to such a degree as to amount to indirect discrimination for the purposes of Article 119 of the Treaty, the national court must verify whether the statistics available indicate that a considerably smaller percentage of women than men is able to fulfil the requirement imposed by that measure. If that is the case, there is indirect sex discrimination, unless that measure is justified by objective factors unrelated to any discrimination based on sex.
Question 5
67 In that respect, the first point to note is that it is ultimately for the national court, which has sole jurisdiction to assess the facts and interpret the national legislation, to determine whether and to what extent a legislative provision, which, though applying independently of the sex of the worker, actually affects a considerably higher percentage of women than men, is justified by objective reasons unrelated to any discrimination on grounds of sex (Case 171/88 Rinner-Kühn [1989] ECR 2743, paragraph 15).
68 However, although in preliminary ruling proceedings it is for the national court to establish whether such objective factors exist in the particular case before it, the Court of Justice, which is called on to provide answers of use to the national court, may provide guidance based on the documents in the file and on the written and oral observations which have been submitted to it, in order to enable the national court to give judgment (Case C-278/93 Freers and Speckmann [1996] ECR I-1165, paragraph 24).
69 It is settled case-law that if a Member State is able to show that the measures chosen reflect a necessary aim of its social policy and are suitable and necessary for achieving that aim, the mere fact that the legislative provision affects far more women than men at work cannot be regarded as a breach of Article 119 of the Treaty (see, in particular, Case C-444/93 Megner and Scheffel v Innungskrankenkasse Vorderpfalz [1995] ECR I-4741, paragraph 24, and Freers and Speckmann, cited above, paragraph 28).
71 It cannot be disputed that the encouragement of recruitment constitutes a legitimate aim of social policy.
72 It must also be ascertained, in the light of all the relevant factors and taking into account the possibility of achieving the social policy aim in question by other means, whether such an aim appears to be unrelated to any discrimination based on sex and whether the disputed rule, as a means to its achievement, is capable of advancing that aim.
74 It is true that in paragraph 33 of the Nolte case the Court observed that, in choosing the measures capable of achieving the aims of their social and employment policy, the Member States have a broad margin of discretion.
75 However, although social policy is essentially a matter for the Member States under Community law as it stands, the fact remains that the broad margin of discretion available to the Member States in that connection cannot have the effect of frustrating the implementation of a fundamental principle of Community law such as that of equal pay for men and women.
76 Mere generalisations concerning the capacity of a specific measure to encourage recruitment are not enough to show that the aim of the disputed rule is unrelated to any discrimination based on sex nor to provide evidence on the basis of which it could reasonably be considered that the means chosen were suitable for achieving that aim.