The EU Pay Transparency Directive¹ (the “Directive”) paves the way to a scenario where workers do not need to share the same contractual employer to compare their remuneration. The decisive question is whether a single entity is responsible for setting the relevant pay conditions. This is the essence of the single‑source principle. If it is concluded that the employee making an equal pay claim does not have a valid comparator to make such a claim, one may argue that it would be futile to delve into which is the single source that may remedy the matter. This is the line of thought carried by Tribunal in Jan Sammut vs HSBC Bank Malta plc².

In this case, the claimant argued that HSBC Holdings plc, the parent company, should be joined to the proceedings on the basis that:

• It allegedly acted as the single source across all entities within the HSBC Group;
• Only the parent company would be in a position to “make good” any discriminatory pay differential;
• As the overarching entity within the global group, it exercised ultimate oversight.

The local entity, HSBC Bank Malta plc, opposed this request, maintaining that the claimant’s employment contract was exclusively with the Maltese company. They argued that group membership alone does not establish shared responsibility for pay conditions and that there was no evidence the parent company influenced the claimant’s remuneration.

The Tribunal ultimately, by decree, rejected the request to join HSBC Holdings plc. It reasoned that before examining whether a single source existed, the claimant must first demonstrate that he and the alleged comparators were indeed comparable. At that stage, this had not been proven, and therefore the request was deemed premature. The Tribunal also relied on the fact that the contractual relationship existed solely with the Maltese entity and not with the UK parent.

On appeal, the claimant argued that relative to the single‑source concept, what matters is who sets or influences pay, not who signs the employment contract. A company need not manage day‑to‑day HR operations or draft the original pay conditions to constitute a single source.

The Court of Appeal ultimately upheld the Tribunal’s decision, but strictly on procedural grounds. It held that:

• The status of comparators must be established first;
• The single‑source question comes thereafter;
• At the current stage of proceedings, involving HSBC Holdings plc was “premature.”

Importantly, the Court did not rule out that the parent company could ultimately be considered a single source. Rather, it stated in effect once comparators are proven, then the question of single source may be examined. 

A key legal reference here is Article 19(1) of the Directive, which provides:

“When assessing whether female and male workers are carrying out the same work or work of equal value, the assessment of whether workers are in a comparable situation shall not be limited to situations in which they work for the same employer, but shall be extended to a single source establishing the pay conditions. A single source shall exist where it stipulates the elements of pay relevant for the comparison of workers.”

This provision confirms that:

1. Comparators need not work for the same employer;
2. The focus is on who sets or controls pay;
3. A single source is defined by responsibility and capacity to remedy inequalities, not by corporate formality.

Yet this sequencing gives rise to a legitimate reflective question: why must comparator status be determined first? Could the argument not run the other way, namely, that establishing the existence of a single source at the outset would itself broaden the scope of available comparators and ensure a fairer assessment?

The Directive does not expressly prioritise one inquiry over the other. Rather, Article 19 highlights two parallel factual questions:

• whether the workers are in a comparable situation, and
• whether a single source establishes the relevant pay conditions.

Seen through this lens, a claimant may be prevented from accessing the very structural information needed to demonstrate comparability without early recognition of a potential single source. This “chicken‑and‑egg” tension underscores the delicate balance courts must strike between procedural order and the Directive’s objective- to facilitate, not constrain, the effective enforcement of equal pay rights.

Watch this space as case-law continues to develop following the recent Equal Pay (Transparency and Reporting) Regulations, 2026² which further transposed the Directive into Maltese law (Read more)!

¹ Jan Sammut vs HSBC Bank Malta plc , Industrial Tribunal, 30^th January 2026, Case no. 3516

₂ LN 173 of 2026.