Coventry City Council could face an equal pay bill of more than £30m, The MJ understands.
The council has received about 680 equal pay claims from the Unison and GMB trade unions, with a tribunal scheduled for November 2026.
Coventry has acknowledged potential legal costs associated with the claims and has established a ‘financial risk contingency reserve' worth £8.5m as of April 2024, which could be used to address unforeseen liabilities such as equal pay settlements.
A tight-lipped council spokesperson said it was ‘still working on potential costs'.
Leader of the opposition Conservative group, Gary Ridley, said: ‘There's a black hole at the heart of this authority's finances in the form of equal pay claims. The leadership is not keen to talk about it.
‘It's been hanging over us like the sword of Damocles for some time and I'm just not convinced they've made sufficient provision to meet these claims. If they haven't, the sword could morph into an axe ripping through essential services, putting the stability of the council in peril.
‘There needs to be a clear, proactive response from the council that includes dialogue with those affected, with a realistic provision being set aside. Sadly, what we have is a council in denial, with senior leaders burying their heads in the black hole in the hope it all goes away.'
However, Coventry's cabinet member for strategic finance and resources, Richard Brown, said: 'The council has mitigation plans in place that are regularly reviewed, but responsible financial management requires avoiding speculation until legal proceedings conclude.'
Last year the Labour-led council controversially fired and rehired a number of employees within waste services on revised terms following consultation with both unions and employees.
Coventry made the move despite the Labour Party having opposed the practice of fire and rehire, and taking steps to restrict its use.
The firing and rehiring was designed to reduce equal pay claims over contracts for some – mostly male – waste staff that allowed workers to finish as soon as they had completed agreed daily tasks.
Coventry's lawyers had advised the authority that the contracts – many of which were signed in 2022 – could have breached equal pay laws because female staff in equivalent roles elsewhere across the council did not enjoy the same benefits.
Earlier this year, the Government approved £52m of Exceptional Financial Support for Southampton City Council to put towards its equal pay claims, with Local Government Association peers describing these as a ‘significant risk to the organisation'.
