Tesco v Element - Why documentation matters for pay transparency
A recent Court of Appeal decision in Tesco Stores Ltd v Element (2026) is a useful reminder that equal pay claims are a real and growing risk for employers.
The case is a UK one, decided under UK law. But the principles it highlights - comparing the value of very different jobs, documenting pay decisions, and defending pay gaps with evidence - are increasingly relevant right across Europe. With the EU Pay Transparency Directive now driving employers in member states to justify pay differences and report on pay gaps, the questions a UK tribunal is wrestling with here are exactly the questions HR and reward teams everywhere are about to face.
The Tesco case itself is about how UK tribunals work out whether one group of employees is doing work of equal value to another, better-paid group. But the bigger lesson is about direction of travel: equal pay claims are getting larger and more complex, and this ruling shows courts pushing for a more practical, no-nonsense way of running them.
Why equal pay is a whole-business problem, not a one-off
Equal pay claims rarely come in ones. In sectors like retail, local government and large service businesses, they tend to arrive as group claims involving hundreds or even thousands of employees at once.
That's because the risk usually comes from how the business is set up, not from a single bad decision. Common causes include:
roles that have ended up heavily male or heavily female (for example, shop floor versus warehouse);
old pay practices and outdated grading systems that no one has revisited;
inconsistent or outdated ways of scoring and comparing jobs.
How UK equal pay law works
At its heart, equal pay in the UK is about your employment contract. The UK's Equality Act 2010 effectively writes a "you must be paid equally" clause into every contract, so that if someone of one sex is being paid less than someone of the opposite sex doing equal work, the lower terms get bumped up to match. Most EU member states have their own equivalent protections, and the EU Pay Transparency Directive is now strengthening them further.
To bring a claim, an employee has to show they're doing "equal work" compared to someone of the opposite sex. That can mean:
the same or broadly similar work;
work that's been formally scored as equivalent under a job-scoring system; or
work of equal value — different jobs that are nonetheless worth the same. This is the route used in most big claims.
The equal value route is the interesting one, because it lets people compare jobs that look nothing alike e.g. a customer assistant on the shop floor versus an operative in a distribution centre. The argument is that, once you weigh up things like effort, skill and the decisions the role involves, the two jobs are worth the same and should be paid the same.
If an employee can show they're doing equal work, the ball moves to the employer. The employer then has to prove the pay gap is down to a genuine reason that has nothing to do with sex. And even if there is such a reason, it has to stand up to scrutiny if it ends up disadvantaging one sex more than the other.
What happened in the Tesco case
When an employer doesn't accept that two roles are of equal value, the UK tribunal brings in an independent expert to assess both jobs and report back. To help that expert, each side puts together a written description of what each job involves, and then the parties have to agree which facts about the jobs they accept and which they dispute.
In the Tesco case, both sides produced extremely detailed job descriptions and ended up disputing thousands of individual facts about what the jobs actually involved. The Court of Appeal decided this was getting nowhere and wasn't fair or sensible. Instead, it found that Tesco's own detailed staff training documents were the best evidence of what the jobs really involved, and told the parties to start again using those training documents as the basis.
In other words: the records the business created in its normal day-to-day operations carried more weight than the polished descriptions written up once lawyers got involved.
Five things to watch for
Your comparison group could be almost anyone you pay from the same source. Employees don't have to compare themselves with colleagues on the same team or even at the same site. If pay across different locations or departments is set by the same source or on common terms, comparisons can be drawn across them. That means your exposure is often much wider than you'd expect.
Your everyday documents are your evidence. This case shows tribunals will lean heavily on documents created at the time rather than descriptions written up after a claim begins. This includes job descriptions, training materials, and records of why pay decisions were made. If those everyday documents are vague or contradictory, they can drag disputes out and work against you.
Old decisions don't go away. Under UK law, equal pay claims can reach back up to six years for back pay (plus interest), and because they're essentially about a breach of contract, liability can sometimes stretch even further. Back-pay rules differ across EU member states, but the underlying point holds everywhere. Pay structures and decisions from years ago can still create risk today, so it's worth looking at your whole pay framework rather than treating claims one at a time.
Get your reasons straight now. Things like market forces or genuine operational differences can be valid reasons for a pay gap but only if you can back them up with a clear paper trail. Reasons that are unsupported or out of date are unlikely to hold up.
Know your exposure early. A single claim can carry a big back-pay bill and trigger a wave of similar claims. It's best to size up the risk across the whole affected group early, and let some basic financial modelling guide how seriously to treat it.
The bottom line
The clearest message from the Tesco case is that a defensible pay position is built long before any claim lands, through clean data, clear and consistent records of what jobs involve, and a documented reason for every pay difference. The documents you create in the ordinary course of business are exactly what a tribunal will rely on. If they're unclear, they'll be used against you.
That's why pay transparency and proper pay gap analysis are risk management and shouldn’t be viewed as a box-ticking exercise. Treating your pay data as evidence, well before anyone files a claim, is what separates the businesses that are exposed from the ones that are prepared.
How Bridgit can help
Our pay transparency tools are designed to give you the clear, consistent, evidence-backed pay position that cases like Tesco show is so important.
Rather than relying on subjective judgement calls about which roles are "worth" the same, Bridgit takes a transparent, mathematical approach to weighting and comparing jobs, grounded in well-researched and methodical frameworks. Every step is fully auditable, so the reasoning behind your pay decisions is documented and defensible from the start, not reconstructed after a claim arrives.
If you'd like to see how Bridgit makes objective job weighting simpler and your pay decisions easier to stand behind, check out our pay transparency features.