Lawyers from Somerset Council will this month defend an unfair dismissal claim at the Employment Appeals Tribunal (EAT) which is seen as a test-case for local authorities.
Mary Biggs, who was sacked from her part-time job as a teacher 17 years ago, is seeking to challenge the UK's three-month time limit on claims.
If the appeal is successful, it is expected to open the door to a flood of retrospective claims, causing administrative chaos for local authorities and other large employers.
"One of the problems is that councils probably don't have records on staff going back that far," says Penny Grainge, the solicitor dealing with the case for Somerset Council. This was recognised by the Exeter tribunal which originally threw out the case.
But Caroline Bates, a barrister for the National Union of Teachers (NUT), will argue that the deadlines do not apply because Britain failed to implement European law.
Article 119 of the Treaty of Rome, which applies from 1976, established the right to equal pay for all workers, but was not incorporated into UK legislation.
Somerset Council, which is instructing David Pannick QC, will argue that the Emmott principle, which established that time limits do not take effect until European rules are in force, applies only to European directives and not to the Treaty of Rome.
The authority also says that Section 2(5) of the Equal Pay Act 1970 prevents workers from receiving compensation for events occurring more than two years before proceedings were started.
Unions have already brought scores of retrospective claims on behalf of part-time workers which have been accepted. The NUT has decided to fight the Biggs case after it was thrown out by the original tribunal.
Bates says: "We take the view that the position is quite clear and we would certainly hope that local authorities will accept that they have been lumbered with a bad lot."
The case is scheduled for hearing before the EAT on 23 February.