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22nd June 2017

Legal Issues – Failing to enhance shared parental pay to match maternity pay was discriminatory

The Shared Parental Leave (SPL) regime was introduced in April 2015 and replaced the previous additional paternity leave regime. SPL allows a mother and her partner to share up to 50 weeks of leave and up to 37 weeks of pay, depending on how much maternity leave and pay the mother takes.

While part of the spirit of the SPL regime is to promote equality between the mother and her partner, whereby they can share almost all the leave and pay the mother would be entitled to under maternity law, some employers are not treating maternity and SPL in the same way.

Such was the case in Ali v Capita Customer Management Limited. Here, Mrs Ali developed post-natal depression and as a result wished to curtail her maternity leave after the two week compulsory period to allow her husband to take 50 weeks as SPL. Mr Ali’s employer provided up to 12 weeks’ maternity leave at full pay, but under its SPL policy Mr Ali would receive only the statutory rate of £140.98 per week for the entirety of the period of SPL.

Mr Ali brought claims of direct and indirect discrimination, with the Employment Tribunal (ET) finding that the difference in pay amounted to direct discrimination, as the maternity pay policy was gender-specific. That is an important point, as direct sex discrimination cannot be justified whereas indirect sex discrimination potentially could be justified if the employer had a legitimate business reason for paying SPL differently.

Another reason why Ali is contentious relates to the particular legal protections afforded to pregnancy and maternity. The Equality Act essentially states that a sex discrimination claim will generally fail if it relates to the special treatment afforded to a woman in connection with pregnancy and childbirth.

However, in Ali, the ET effectively stated that that special treatment needn’t be applied after the two week compulsory maternity leave period. This thinking is not supported elsewhere in law and is likely to be a point of appeal, as Capita have indicated that they intend to do.

An appeal would be helpful here, as there has been another recent decision that contradicts the reasoning in Ali. In Hextall v Leicestershire Police, a case involving similar facts, both the claim of direct and indirect discrimination failed as the ET stated that a man taking SPL cannot compare himself to a woman taking maternity leave. However, the ET did state that, if an indirect discrimination claim were possible, cost alone would not be sufficient to justify the difference in treatment.

In addition, again in contrast to Ali, the ET in Hextall stated that the special protection afforded to pregnancy and maternity would apply beyond the initial two week period.

While we await a more binding decision on the subject, we would encourage employers to look at their own pay practices in relation to family-related leave to consider whether potential inequalities exist between maternity pay and SPL. It may be decided that maternity leave cannot be compared to SPL and as such the risk of similar claims is reduced.

However, we are now in an age where parenting gender roles are different to the past, if existent at all. While previously women may have been seen as the primary care-giver, now responsibilities (for both care-giving and financial earning) are less easily delineated based on sex. For that reason, employers should consider whether inequality in their pay policies could encourage employees to look elsewhere in the job market, as that in itself could be more costly than a tribunal claim.

If you have any questions on any of the issues raised in the above article please contact Seanpaul McCahill.

22nd June 2017