Enhanced Shared Parental Pay - Not Discrimination

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A decision not to pay a father enhanced shared parental pay (in contrast to enhanced maternity pay) did not amount to direct discrimination, according to a recent decision of the EAT. This important decision will give a temporary reprise to those employers who decided not to replicate enhanced maternity pay for parents taking shared parental leave, although it is unlikely to be the end of the matter.

The appeal in Capita Customer Management Ltd v Ali was linked to a similar case Hextall v The Chief Constable of Leicestershire Police. In Hextall the tribunal reached a different conclusion regarding the discriminatory consequences of failing to pay enhanced shared parental pay. The EAT judgment is still awaited in Hextall which concerned additional arguments involving indirect discrimination which were not considered in the Ali case before the EAT.

Facts

In Ali the claimant wanted to take shared parental leave (SPL) after his wife was diagnosed with post-natal depression and was advised by her GP to go back to work. Capita paid enhanced maternity pay for the first 14 weeks of leave and enhanced paternity pay for 2 weeks followed by statutory SPP. The claimant asked for his shared parental leave pay to be enhanced and for him to be paid the same higher rate as a woman on maternity leave. He raised a grievance which was rejected he then issued proceedings claiming both direct and indirect discrimination.

The tribunal decision

The tribunal ruled that the claimant could compare himself to a female employee who was taking leave to care for her child although this would not apply until after the 2 week compulsory maternity leave period. The tribunal also rejected the argument put forward by the employer that s.13(6)(b) of the Equality Act 2010 (“the special protection provision” afforded to women in connection with pregnancy or childbirth, which allows more favourable treatment) could shield an employer from a challenge to enhanced maternity pay.

The issue after the first 2 weeks was about caring for the child – it was not special treatment in connection with the mother’s pregnancy or childbirth. The tribunal accepted that after 2 weeks the government had offered parents the option of choosing who should care for the child: that the primary carer under SPL could therefore be the father or the mother. The claimant was also successful in a number of his complaints regarding victimisation after raising his grievance and his subsequent stress related absence. His employer’s appealed.

The EAT ruling

Reversing the tribunal’s decision the EAT ruled that there was no direct discrimination. The tribunal had been wrong regarding the claimant’s choice of comparator. Mr Ali should have compared himself to a female partner of a birth mother who was taking shared parental leave, and not to a woman taking maternity leave. He was unable to compare himself to a female on maternity leave because there was a material difference in the two types of leave (in order to establish a comparator in direct discrimination cases there must be no material difference in the circumstances).

The EAT said there was a material difference between maternity leave and SPL. The purpose of maternity leave (and pay which was linked to the leave) was to protect the mother’s health and wellbeing after birth rather than purely being a childcare measure. In reaching this decision the EAT looked at the sources of the relevant legislation: in particular the fact that maternity leave and pay derived from the EU Pregnant Workers Directive, which was a health and safety measure. In contrast, shared parental leave was a childcare measure.

Although the ruling on the comparator point dismissed the direct discrimination claim, the EAT did go on and consider the application of the special protection in s.13 (6)(b), and whether it was lawful that enhanced maternity benefits could amount to preferential treatment and therefore be protected from a claim. Again, reversing the tribunal decision, the EAT ruled that s.13(6) (b) did apply to the facts of this case and provided the employers with a defence to offering lower pay rates for SPL.

The EAT did accept that there may be some merit in the argument put forward by the intervener in this case, the organisation Working Families, that the health reason for the leave may in effect “detach” as being the primary purpose for the leave. Working Families suggested this may happen at the end of Ordinary Maternity Leave period at 26 weeks. However this was only a comment and does not have legal force.

Where does this leave employers?

This decision is good news for those employers that do not replicate enhanced maternity benefits. However, we do not expect this to be the final position. The EAT in Ali did not consider the indirect discrimination argument. Hopefully this will be addressed in the Hextall judgment which is expected shortly.

In relation to direct discrimination, there are some European decisions that take the view that while maternity leave may involve special biological protection at first, there comes a time when the leave detaches from this reason, to childcare reasons. If childcare is the reason for the leave then comparing maternity leave and SPL becomes less about comparing apples and oranges. That may make the central arguments in this case regarding the material difference comparator and the special protection defence, where there needs to be a link to pregnancy and childbirth under s.13(6) (b) more difficult to satisfy. In addition a more creative choice of comparator may arrive at a different result in terms of discriminatory conduct.