Enhanced pay for shared parental leave

Since the introduction of shared parental leave, it has been questioned whether those taking that leave would be entitled to the same benefits as those taking maternity leave.

The Employment Appeal Tribunal (EAT) has now ruled that it is not discriminatory for an employer to pay enhanced maternity pay but only statutory pay for shared parental pay.

Up until this point, there had been conflicting case law – the Employment Tribunal decision in Ali v Capita Customer Management Ltd contrasted with the ruling in another Employment Tribunal case with similar facts, Hextall v Chief Constable of Leicestershire Police. This EAT ruling is the first time the issue has been put beyond an Employment Tribunal.

What does the law say on discrimination? 

Under the Equality Act, an employee is directly discriminated against by another person if they treat the individual less favourably than they treat others and this is because of a protected characteristic.

  • Less favourable treatment means treating someone in a worse way than another person. It must be demonstrated that the employer has treated the employee less favourably than a real or hypothetical comparator.
  • These protected characteristics include age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex and, sexual orientation.

How does shared parental leave work?

By law, a birth mother must take a minimum of two weeks’ maternity leave after having a baby, or four weeks for factory workers.

As long as these minimum periods are respected, the parents can opt in for shared parental leave at any time. The mother can end her maternity leave early and share up to 50 weeks of the remaining leave entitlement with the father of the baby or her partner to care for the child. They may also be entitled to up to 37 weeks of Statutory Shared Parental Pay.

What are the facts in this case?

In Ali v Capita Customer Management Ltd, Mr Ali requested to take shared parental leave after his partner was advised to return to work as a result of her postnatal depression. The company policy allowed those on maternity leave 14 weeks on full pay followed by 25 weeks of Statutory Maternity Pay, but the company did not offer any enhancement on Statutory Shared Parental Pay.

He accepted that for the first two weeks following a birth, women are required to take compulsory maternity leave to recover. However, after this period, either the mother or father could take care of the baby, but as a male employee, he was not entitled to the same pay for taking time off to care for his child. He maintained that this was direct sex discrimination.

Capita Customer Management Ltd contended that he couldn’t compare himself to a woman on maternity leave as he hadn’t given birth.

What did the Employment Tribunal decide?

The Employment Tribunal upheld the claim for direct sex discrimination.

They reasoned that he could compare himself after the two week compulsory leave period with a woman on maternity leave who had taken time off to care for a child.  They continued that there had been direct sex discrimination because he was not entitled to the same rate of pay in the subsequent 12 weeks.

Capital Customer Management Ltd appealed the decision.

What did the EAT rule?

The EAT disagreed with the Employment Tribunal and held that the rate of pay for a male employee taking shared parental leave should not be compared to a female employee on maternity leave following those first two weeks of compulsory maternity leave.

The EAT said that the reason for maternity leave is to protect the health and wellbeing of a woman who has given birth, been pregnant or is breastfeeding. While she will be caring for the child, this is not the main reason for the leave. However, the purpose of shared parental leave is to care for the child.

Therefore, the correct comparator is a woman who is on shared parental leave. As such, in these circumstances, parents of either sex had the right to the same benefits on shared parental leave and there is no discrimination.

Comment

There will be a sigh of relief amongst employers, but it remains to be seen whether there will be further appeals. We are also awaiting the judgment in the EAT case of Hextall v Chief Constable of Leicestershire Police.

Director of Legal Services

James Tamm

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