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Equal pay claim bill £50 million for Walsall Council

Equal pay claims made by employees of Walsall Council could cost its tax payers £50million it has been revealed. The local authority is currently carrying out a major pay review known as the single status agreement, in an effort to resolve the issue.

However, in order to meet the cost of the agreement it will have to borrow £48.4m to cover the extra money it will have to shell out to pay the salaries of thousands of workers if the review is endorsed.

It follows other West Midlands councils such as Birmingham City Council who have had to carry out similar reviews. Birmingham City Council was forced to review its salary scheme following an equal pay claim brought by a group of disgruntled female employees who demanded equal pay when they found their salaries were less than their male colleagues who did the same work.

Walsall council leader, Mike Bird, has told the Express and Star newspaper the current proposal would see 29% of just under 8,000 council staff having salaries cut, with everyone else set to gain financially or keep the same wages.

The review, it is hoped, will ensure equal pay for workers of similar skill levels and prevent hundreds of salary disputes.

But councillor Ian Robertson, a member of the council's audit committee, said he was worried about the implications of any long-term borrowing and said it was unusual for councils to borrow this amount of money. He told Payroll World: ‘There is trouble brewing at the mill. I’ve been told that the worse case scenario is that there will be dozens of tribunals. I’ve asked for figures but have not got any yet as they [council officials who supply the data] are all in court.’

Councillor Robertson is concerned, ‘because you are not usually able to get loans of this size. £5-6M is OK but this figure is so high. We will have to charge this against council tax.

‘Usually in the terms of borrowing you must offer some projection of repayments but I am not aware of any plans to pay it back in a certain amount of time,’ he added.
01/07/2010