An employment tribunal has held an employer liable for direct sex discrimination on the basis that it pays shared parental leave, which can be taken by both genders, at a lower rate than that of enhanced maternity pay.
This ruling goes against the consensus, and Government guidance, that employers do not need to offer enhanced shared parental pay to match an enhanced maternity pay policy.
Shared Parental Leave (‘SPL’) came into force in December 2014. SPL allows parents to share child care in the first year by allowing the mother/adopter to return to work and convert a portion of that leave to a named partner. Up to 50 weeks’ leave and 37 weeks’ pay can be shared between both parents.
The default position is that SPL is paid at a flat statutory rate (currently £140.98 per week). There is no requirement in the legislation for organisations to offer enhanced SPL just because they offer enhanced maternity pay.
In Ali v Capita Customer Management Limited Mr Ali, (‘the Claimant’) was a former Telefonica employee who transferred to Capita under TUPE. Telefonica’s policies, including its maternity policy, also transferred to Capita.
Telefonica’s policy allows female employees 14 weeks’ enhanced maternity pay, followed by 25 weeks at the statutory rate. New fathers are entitled to two weeks’ on full pay during paternity leave under its policy.
The Claimant took two weeks’ paternity leave, and with his wife returning to work he sought to convert and take the remainder of her maternity leave as SPL. Capita informed him that SPL would be paid at the statutory rate, rather than at the enhanced rate offered for maternity leave. The Claimant brought a claim for direct sex discrimination.
The tribunal found for the Claimant and held that Capita directly discriminated against the male employee in only offering statutory pay for SPL, while female employees are entitled to enhanced maternity pay. The tribunal appeared to reject the Government’s view that there is no legal obligation to match enhanced maternity pay.
The fact that the Claimant was deterred from taking SPL due to the pay policy was enough to establish liability for discriminatory treatment. The tribunal found that the treatment could not be classed as indirect discrimination, which would have allowed the employer to try to objectively justify the policy. The contractual maternity pay policy was gender specific and therefore directly discriminatory.
The Equality Act 2010 at section 13(6)(b) provides that ‘no account is to be taken of special treatment afforded to a woman in connection with pregnancy or childbirth’. The tribunal found that this should apply only to the 2 weeks of compulsory leave after birth, since that period of leave is unique to those who have given birth. The other leave entitlements are for care of the child, which can be a female or male role. As such the special protection afforded under section 13 ceases to exist after the initial 2 week period, the tribunal ruled.
As a first-instance tribunal ruling, this case does not set a precedent for other tribunals to follow, but it may be persuasive. Capita has sought leave to appeal. Binding judicial guidance would be welcomed by employers, since this ruling appears to be at odds with Government guidance on this matter.
Indeed, this ruling is at odds with the earlier judgment in Hextall v Chief Constable of Leicestershire Police which found that it was not discriminatory to pay enhanced maternity pay but not enhanced SPL. And a European Court of Justice ruling determined that a maternity period of 16 weeks was intended to protect a woman’s biological condition, at odds with the tribunal’s reasoning in Ali.
Employers do not need to amend their policies at this stage though may wish to keep their family-friendly policies under review pending the outcome of any appeal. In particular, employers may want to consider whether enhanced SPL pay will assist in attracting and retaining staff, which is presumably the reason many employers offer enhanced maternity pay.
For advice on drafting policies or any other employee relations issues please contact the Devonshires Employment Team.