The Court of Appeal has recently handed down an important decision surrounding whether, or not, it is not discriminatory for employers to pay its female employees enhanced maternity pay during periods of maternity leave but only offer the statutory minimum pay entitlements to any employees who chose to take advantage of shared parental leave (SPL).
This influential decision combined the cases of Ali v (1) Capita Customer Management, (2) Working Families (Intervener) and Chief Constable of Leicestershire Police v (1) Hextall. In reaching its conclusion the Court of Appeal affirmed that there is no breach of the Equality Act 2010 and it would not be considered as either direct, or indirect discrimination if an employer offers its employees enhanced maternity pay but does not choose to enhance payment during periods of SPL.
The claimants in both cases were fathers who chose to take time off under the SPL provisions and they were only paid statutory pay for this time. In one case, the father was aggrieved to learn that a female employee who took time off on maternity leave would be entitled to 14 weeks full pay during maternity leave. In the other, the employer enhanced maternity-pay for 18 weeks. The reasoning and consideration that was applied at the Employment Tribunal indicated that this complaint had some merit. Whilst they recognised that the period of compulsory maternity leave (2 or 4 weeks immediately following the birth depending on the nature of work that is undertaken by the mother) was a period of special consideration which was unique to a woman who gives birth and should therefore be treated differently. The initial tribunal decision in Ali v (1) Capita Customer Management, (2) Working Families (Intervener) accepted that it was right to compare a mother who was absent and on maternity leave with a father who was absent under the shared parental leave provisions and concluded that not enhancing shared parental leave pay was therefore discriminatory. However, the EAT and the Court of Appeal disagreed with this finding, and the Tribunal in Chief Constable of Leicestershire Police v (1) Hextall were not persuaded either.
The Court of Appeal have concluded that there is no requirement to enhance payment during a period of SPL. In reaching its decision they focused on who was an appropriate, and correct, comparator to establish whether there was less favourable (and discriminatory) treatment they identified that it should be a female who was taking SPL not a new mother who was absent on maternity leave. The Court emphasised that the circumstances of maternity leave are not just special during the initial compulsory period but right the way through. They recognised that maternity leave can; begin before the birth of a child, arise even in cases where there is no child to look after, and is an automatic day one right for an employee. Whereas, SPL can only occur; after the birth of a child, it is subject to there being a child to look after, and furthermore, there is the requirement for the Employee to have a minimum period of employment (26 weeks service by the 15th week before the baby is due).
Time will tell whether this will be appealed to the final stage of the Court system, but until, or unless we get to that point, this seems to be a very sensible and appropriate interpretation of the law and gives clear guidance that payment for SPL need not be enhanced. If an employer chooses to enhance, in an effort to encourage more uptake of the provision or as something to be seen as employment benefit, that would be a matter of commercial consideration