Equal pay for leave?
Ian Machray explores shared parental pay rates and whether they can be discriminatory.
In a recent case, the Employment Appeal Tribunal (EAT) considered whether an employer’s failure to pay enhanced shared parental pay (SPP) in line with enhanced maternity pay amounted to direct sex discrimination.
Mr Ali began working for Capita Customer Management Limited (CCM) in July 2013. Following the birth of his daughter in February 2016, Mr Ali took two week’s paid leave. When Mr Ali requested further leave to care for his daughter, he was informed that he was eligible for shared parental leave but would be paid at the statutory rate; which was less than women were paid by CCM on maternity leave during the same period.
Mr Ali alleged direct sex discrimination against CCM. Mr Ali argued that since the shared parental leave regime allows parents to choose who takes leave to care for their child after the mother’s two-week compulsory maternity leave, it was discriminatory for the mother to be paid more than the father in respect of the remaining leave. The tribunal upheld Mr Ali’s claim of direct sex discrimination. CCM subsequently appealed to the tribunal’s decision in the EAT.
The EAT overturned the tribunal’s decision ruling that the treatment of Mr Ali did not amount to direct sex discrimination and stated that the tribunal had failed to consider that the primary purpose of paid maternity leave is the health and wellbeing of the pregnant and birth mother. The level of pay was inextricably linked to this purpose. In contrast, the primary purpose of shared parental leave is the care of the beneficiaries’ child.
The payment of maternity pay at a higher rate was not direct sex discrimination as it fell within the exception in the Equality Act as “special treatment afforded to a woman in connection with pregnancy or childbirth”.
This ruling is binding and offers much needed clarification on the application of shared parental leave. That said, further clarification is shortly expected on shared parental pay and indirect sex discrimination and we now await the outcome of a related case in which a ruling will be made as to whether a police force’s policy of giving full pay to mothers on maternity leave, but paying only statutory shared parental pay to partners, is indirectly discriminatory. We shall update you with any further developments.