Shared parental leave pay and the potential for sex discrimination claims against employers

Is it discriminatory for an employer to provide shared parental pay at a less favourable rate than maternity pay?

In Ali v Capita Customer Management Ltd, an Employment Tribunal recently considered the issue of shared parental leave pay. The Tribunal determined, based on the facts of the specific case, that an employer’s policy to pay female employees full pay whilst taking maternity leave but to pay only the statutory rate to a father wishing to take shared parental leave amounted to direct sex discrimination in this instance.

Shared Parental Leave Pay

Facts

In this case the claimant's wife was diagnosed with postnatal depression and received medical advice that she should return to work as it may assist with her recovery. Thus, the claimant wanted to take leave to care for his child and to enable his wife to return to work. However, he was deterred from doing so because his employer would pay him only statutory rather than full pay during his period of shared parental leave.

The claimant argued before the Tribunal that his employer's policy was discriminatory on the grounds of sex because under the maternity policy women (mothers) were entitled to 14 weeks of leave on enhanced maternity pay. Yet the claimant, and all qualifying male employees using their family friendly entitlements, would only receive full pay for the two weeks of paternity leave followed by statutory pay during shared parental leave.

Decision

In finding in favour of the claimant the Employment Tribunal focused, in particular, on the following factors:

  • the Tribunal highlighted that the leave period under consideration in this case was the period after the two weeks of compulsory maternity leave and, as such, took the view that the woman was no longer in a unique position due to her pregnancy. The Tribunal acknowledged that the physical aspects of pregnancy and childbirth receive satisfactory protection during the compulsory leave period. Thus, outwith a mother's compulsory period of leave, an employer could not rely on the defence that special protection and more favourable treatment should be afforded to women on maternity leave;

  • the Tribunal held that during the 12 weeks of leave following the compulsory two-week period, the claimant would be carrying out the same role as a woman on maternity leave: namely caring for the child, and as such by being paid less than a mother on maternity leave the claimant was being treated less favourably in comparable circumstances.

Comment

This decision comes despite the government's guidance which suggests that there is no legal obligation on employers to ensure equal enhanced rates of pay for parents taking shared parental leave and maternity leave. However, this failure to do so can result in employees raising direct discrimination claims against their employer.

This decision builds on the Snell v Network Rail case last year in which a father succeeded in claiming it was discriminatory to pay mothers and fathers unequal rates of shared parental leave pay (see our blog here: Shared parental leave pay). It differs from this case, as the comparison there was between males and females taking shared parental leave, rather than comparing maternity leave and shared parental leave.  It should be noted that both cases are first instance tribunal decisions and, as such, are not binding. 

There is speculation that the Employment Tribunal's decision is being appealed to the Employment Appeals Tribunal (EAT). This is in particular because mothers (or female partners of mothers) who took shared parental leave would only be entitled to statutory pay and were so treated as the same as fathers – it was only on the maternity leave policy that an enhanced rate was offered.  

An appellate decision on the issue of shared parental pay would be gratefully received in order to provide greater clarity on this disputed area. Until the outcome of any appeal is known, this case highlights the potential risks for employers in providing different levels of pay to employees of different sex when family friendly provisions are involved.

However, the solution arrived at by the employer consequent to the Snell case was to reduce the enhanced entitlement for mothers, rather than increase the fathers' entitlement, and this may be an unfortunate impact of these decisions.    

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