Labour Court approves job evaluation in wage discrimination case

In a February 2001 ruling, the Swedish Labour Court found that there had been no unlawful gender wage discrimination in a case relating to two midwives and a medical technician at the Örebro regional hospital. The case attracted much attention and its outcome was of special importance because, for the first time, the Court approved the use of a job evaluation procedure in a wage discrimination case.

On 21 February 2001, the Swedish Labour Court (Arbetsdomstolen) issued its judgment in a case brought by the Equal Opportunities Ombudsman (Jämställdhetsombudsmannen, Jämo) against the county council of Örebro län, a district west of Stockholm. Jämo represented two midwives employed at the Örebro regional hospital and the county council represented a medical technician employed at the same hospital. The dispute related to the issue of whether the midwives (both women) had been subjected to unlawful wage discrimination, as the county council had paid a lower salary to them than to the male medical technician. The Ombudsman had claimed that the council should be ordered to pay damages to the midwives for disregarding the Equal Opportunities Act (Jämställdhetslagen1994:292).

In its ruling (Dom nr 13/01, mål nr A 190/97), the Labour Court found that there was no unlawful wage discrimination in this case. However, the Equal Opportunities Ombudsman, Claes Borgström, stated, just after the judgment was made public, that he regarded the Labour Court's decision as representing half a victory, as for the first time ever the Labour Court had approved of the use of a job evaluation (arbetsvärdering) exercise in a wage discrimination case.

The case

The Equal Opportunities Act states in (section 18), among other provision, that "unlawful discrimination on grounds of sex is to be regarded as existing where an employer accords lower pay or otherwise applies less favourable conditions of employment to an employee than those which it accords to an employee of the opposite sex where such employees perform work which is to be regarded as identical or of equal value. However, there is no discrimination if the employer can show that the different conditions of employment are based on differences in the employees' actual qualifications for the work or that in any event they have no direct or indirect connection with the sex of the employees" (the content of this section reflects EU law, notably Directive 75/117/EEC on equal pay for women and men)

The two midwives and the medical technician involved in the present case were all employed at the regional hospital by Örebro county council between 1994 and 1996. The three workers were trade union members and belonged to two different trade unions, both of which had collective agreements with the county council on pay and other employment conditions. There had been an earlier dispute over alleged wage discrimination between Jämo and the county council relating to one of the midwives involved in the present case and two medical technicians. In April 1996, the Labour Court rejected the claim, stating that Jämo had not proved that the tasks of the female and male workers had been of equal value. This, however, encouraged Jämo to conduct a more thorough investigation and wage analysis, and subsequently to return to the court with the current case. The main proceedings in the case were due to start in autumn 2000.

Before the proceedings started, the Labour Court referred to the European Court of Justice (ECJ) the question of what elements should be included in the wage comparison between the male and female workers. The county council had argued that the midwives' additional pay for inconvenient working hours - as well as the value of about four hours per week of reduced working time which the midwives enjoyed because they worked in a three-shift system - should be included. On 30 March 2000, the ECJ ruled (in case C-236/98) that remuneration for inconvenient working hours should not be included in the basis for wage comparison. It also stated that a reduction of working time, or its worth in money, should not be included. The total difference in pay between the midwives and the technician, in favour of the latter, had varied from SEK 2,000 to SEK 4,000 per month over 1994-6.

Jämo's job evaluation analysis

In support of its case, Jämo conducted an evaluation of the work of the midwives and the technician. In its presentation of the case in court, it stated that the education period (including periods of practical experience) of the midwives added up to eight and a half years. The education period for the technician was seven and a half years (practical experience included). In its job evaluation analysis, JämO referred to the four criteria for determining the value of a job mentioned in the preparatory documents for the Equal Opportunities Act - "knowledge and competence", "effort", "responsibility" and "working conditions".

With regard to knowledge and competence, JämO stated that the demands on the midwives in this area seemed to be somewhat higher than those on the technician. The demands in terms of problem-solving competence were about the same, though the midwives' competence concerned medical and ethical competence whereas the technicians' work tasks concerned technical competence. In the area of human relations, the demands on the midwives' competence were much higher. As regards competence in the areas of change and flexibility, it was stated that both categories have to follow up and adapt to technical developments. The demands in this area were probably higher for a medical technician, but on the other hand the flexibility demands were higher for a midwife.

Under the second main criterion used in the analysis, effort, the demands in terms of concentration were seen as equal for both categories of workers. However, the part of the working time when the job tasks are being performed under a heavy workload was longer for the midwives. There was also more stress and more emergency situations for the midwives. These workers also had to be more "emphatic" in their work. As for physical effort, the midwives had to perform heavy lifting of live people, which JämO regarded as more demanding than the physical efforts demanded of a medical technician.

The third main criterion which was used for the work evaluation analysis is responsibility. None of the two worker categories had a genuine responsibility for controlling work, JämO stated, but the midwives had a certain control function over the assistant nurses helping at births. The midwives also had a great responsibility for the patients' life and health and a mistake could lead to the loss of their job. On the other hand, the medical technician had a much greater responsibility for material and economic resources, as he had to control and keep valuable equipment in good repair. As to the fourth main criterion, working conditions, Jämo stated that the work environment for the midwives was on the whole more uncomfortable than that for the medical technician.

The city council's objections

The city council stated in its presentation of the case that the job evaluation carried out by Jämo contained systematic faults and inconsistencies, factual mistakes and subjective estimations. The two jobs involved (midwife and medical technician) cannot be compared at all, it asserted. In order to compare two types of work, the council claimed, one has to compare them in comparable situations - meaning that the types of work must be found in the same line of activity or the same kind of activity. For example, administrative work can be compared with other administrative work, a technician's work can be compared with another technician's work, and a doctors' work can be compared to a nurse's work. The country council referred to recent ECJ case law (Case C-309/97, Angestelltenbetriebsrat der Wiener Gebietskrankenkasse v Wiener Gebietskrankenkasse) and stated that the work of a medical technician could not be compared with a midwife's job. The wage differences in this case, it was claimed, arose from: the fact that there are collective pay agreements between the employer and the trade unions in the sector; the age differences between the technician and the midwives (the former was older); and the effects of labour market forces.

The Court's opinion

The Labour Court stated in its opinion on the case, referring to national law and EU legislation and case law, that even quite different jobs may be seen as being of equal value according to the law. A job evaluation of the three jobs concerned should indeed be carried out using the four criteria set out in the preparatory documents for Sweden's gender discrimination legislation - knowledge/competence, responsibility, effort and working conditions. Evaluating these criteria in this case, the Court found that the knowledge and competence demands of the two midwives' work were not less than those of the technician's work. The same conclusion was reached for the criterion of responsibility. As for the other two criteria, the Court stated that the three workers carried out work tasks of equal value.

Had the county council shown that the wage differences identified in the case had no connection to the sex of the workers? As mentioned above, the council claimed that the differences arose from the terms of collective agreements, age differences and labour market conditions. In its reasoning as to the significance of existing collective agreements on pay, the Court asserted that the fact that the salaries of the employees concerned had been set by collective agreements did not automatically mean that no wage discrimination had occurred. The existence of pay agreements has to be weighed alongside other factors, though. As to the employer's argument about the differing ages of the workers, the Court stated that generally the age of an employee is a factor in wage setting which is material and normally not connected to gender differences. In this case, the two midwives would have had a higher salary had they been the same age as the medical technician.

More importantly, however, the wage level of the technician should be seen in comparison with the situation for technicians in the wider labour market, the court stated. In this case, there was a large alternative labour market for medical technicians in the private sector, but not for midwives. The county council had no alternative but to pay a competitive salary to the medical technician in order to counter market forces and retain him as an employee. It is probable that a worker of the same background and age as the technician would have a salary in the private sector comparable to the technician's pay at the Örebro regional hospital.

The Labour Court concluded that the work performed over 1994–6 by the two midwives and the medical technician was of equal value, and that the technician had earned SEK 2,000 to SEK 4,000 more per month than the midwives. There was thus a presumption for wage discrimination, according to the Equal Opportunities Act. Örebro county council had, however, in referring to the age differences, the labour market situation and the existing collective agreements, proved that the wage differences had no connection with the sex of the three employees. There was thus no unlawful wage discrimination

The Labour Court's decision was not unanimous. Three out of seven members of the Court had a dissenting opinion. The latter's main argument was that the county council had not proved sufficiently that the medical technician had such a high value as claimed on the private labour market.

Commentary

Looking at the facts, what is really notable in this case is that the Swedish Labour Court has for the first time approved a system of comparing and evaluating two different jobs - the jobs of two midwives and a medical technician. The Court found that, in this specific case, the jobs were of equal value. That is a great achievement for the future setting of pay for "typical" male and female work. However, in this case, the Court did not see the workers' different salaries as constituting wage discrimination. A majority of the Court's members - the chair of the Court (a lawyer), two representatives of employers' associations and one trade union representative (one woman and three men) - used the traditional argument that market forces determine certain wages. The technician's value on the labour market was said to be higher than that of the midwives, and this factor influenced his individual pay level. Other influencing factors were the technician's age - he was 14 years older than the older of the two midwives - and the relevant collective agreements. These collective agreements contained different pay levels, which should be respected. The Court underlined that it is up to the parties to take care of wage setting. This should not be done in court.

The three dissenting Court members - the deputy chair (a lawyer), one trade union representative and the only independent member (all women) - stated that the employer had not sufficiently proved the technician's value in the private market. They doubted that the technician, after such a long (29 years) and specialised employment at the regional hospital, really had the general competence required of an in-demand medical technician on the private labour market.

Nevertheless, the winners in this case may soon turn out to be the midwives, when it comes to the argument over market value. The actual pay of many workers is nowadays set in local negotiations, which allow fairly wide deviations in a favorable direction for the employees, at least in times of high demand for specialised workers. This is an argument that, ironic as it may seem, is generally advocated by employers. In a few years' time, there will be a great shortage of nurses on the Swedish labour market. Thus, it is quite possible that in future the pay of nurses and midwives will be driven upwards by market forces.

Some critical voices commented after the judgment was published that the Labour Court's composition - two judges/lawyers, four elected representatives of the social partners (highly reputable and experienced lawyers and negotiators) and one independent member - is becoming more and more inappropriate. One lawyer commented that having the social partners judging in a case where the social partners are involved, even if they do not come from the same sector of the labour market, may constitute a threat to "legal security". However, that is another issue. (Annika Berg, Arbetslivsinstitutet).

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