The Times reports that, at a meeting attended by Neil Gray and Shirley-Anne Somerville – the cabinet secretaries for health and social justice respectively – the crossbench peer said she “would have thought that following the Supreme Court judgment, there would have been a resolution” and that “resolution of this matter should be possible”. 

Baroness Falkner told ministers that the health service was “bound by the law and should not delay complying with it” 

In April, Britain’s top judges ruled decisively that for the purposes of UK equality laws, humans cannot change sex. 

However, NHS Fife has continued to fight the case involving Peggie, which centres on the nurse’s opposition to having to share the women’s changing rooms with Dr Beth Upton, who identifies as female, at Victoria Hospital, Kirkcaldy. 

Baroness Falkner(Image: )

The decision to proceed with the defence has added a six-figure sum to an already huge legal bill, being funded by taxpayers. 

After the Supreme Court ruling in April, in which the campaign group For Women Scotland won a landmark legal victory against the Scottish government, NHS Fife faced calls to concede the case as Peggie’s legal right to single-sex spaces based on biology had been emphatically established in law. However, the tribunal resumed in July. 

NHS Fife refused to confirm whether Baroness Falkner’s warning had been passed on. 

Trina Budge, a director at For Women Scotland, said: “I think everyone, except NHS Fife, bizarrely, can see they should have conceded the case and reached a settlement with Ms Peggie long before now. The Supreme Court ruling was the final nail in the coffin of any argument they conceivably had. 

“The question now is why the Scottish government has not heeded Baroness Falkner’s advice and stepped in to limit the NHS’s humiliation and, more importantly, to save taxpayers a fortune.” 

For Women Scotland say the Scottish Government is backsliding on implementing the Supreme Court(Image: PA)

NHS Fife continues to contest Peggie’s tribunal case despite clearing the nurse in a separate internal disciplinary investigation, in which she was accused of misconduct, and rewriting its own policies to make clear that trans workers may no longer use facilities reserved for the opposite sex. 

Minutes of the meeting, released in response to a Freedom of Information request, show that Falkner “cautioned against delaying” in following the law more generally, with the SNP then saying they were waiting for new formal guidance from the EHRC before rewriting policies. 

Falkner went on to state that the NHS was “bound by the law now and should not delay complying with it”, warning that failure to comply would expose the health service to risk. 

Raising the Peggie case specifically, she told ministers “that resolution of this matter should be possible following the Supreme Court judgment”. 

The records of the exchanges add: “She [Falkner] noted that the ongoing NHS tribunal in Fife is expected to recommence in July and would have thought that following the Supreme Court judgment, there would have been a resolution to the litigation.” 

A final ruling in the case is expected next month at the earliest, with legal experts seeing the Supreme Court judgment as delivering a significant boost to Peggie’s case. 

The tribunal centres on a row Peggie had with Upton on Christmas Eve 2023 in changing rooms for female staff at the hospital. 

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Peggie confronted Upton and said the doctor should not be using the women’s changing rooms. 

Upton, who had been given permission to use the women’s facilities by managers, claimed to have been subjected to a transphobic “hate incident”. Peggie was suspended from work, investigated for bullying and threatened with the sack. 

NHS Fife maintains that the manner in which Peggie raised her objections were unreasonable. Supporters of the nurse insist she was merely standing up for her legal right to single-sex changing facilities. 

A spokesperson for the Equality and Human Rights Commission said: “Baroness Falkner was not commenting on the potential outcome of the employment tribunal or the actions of the parties involved. 

“Instead she sought to highlight that the Supreme Court’s ruling of 16 April — on the definition of ‘sex’ in the Equality Act 2010 — would help bring the case to a conclusion. 

“Separate to these proceedings, we have engaged with NHS Fife on the provision of single-sex facilities for staff. This has included directing the health board to take corrective action to ensure compliance with the Equality Act and Public Sector Equality Duty.” 

Asked whether Falkner’s comments had been passed on, a spokeswoman for NHS Fife said that it would be inappropriate to comment on a live legal case.