As we covered in our article last month, the new family friendly rights are beginning to come into force in preparation for 6 April 2015, when eligible parents will be able to take the new shared parental leave for the first time.
We have already received a number of enquiries from employers asking whether they will be expected to pay a man (or woman) who takes shared parental leave at the same rate as they would pay a woman on maternity leave. Nick Clegg has recently announced that all civil service employees will be given equal pay during shared parental leave, which he described as an attempt to set an example for other public and private sector organisations to follow.
While many employers offer enhanced maternity pay, this is not quite as common when it comes to paternity pay, and previously the difference has been justified on the basis that maternity is a special case linked to pregnancy. Can that still be the case if both employees take shared parental leave?
The simple answer is that the legislation does not require you to pay maternity pay at the same rate as shared parental pay (and the Government’s technical advice confirms this is their view). However, there is a risk that the true position may be more complicated, as employees may be able to challenge this.
An employee at Ford, Mr Shuter, recently challenged the fact that during his five months of additional paternity leave he was paid less than a female Ford employee would have received if she had been on maternity leave for the equivalent period. As you may be aware, additional paternity leave is very similar to shared parental leave in that it is only applicable when the mother has returned to work (shared parental leave will replace additional paternity leave from next April).
Mr Shuter claimed that he had been discriminated against on the grounds of his gender both directly and indirectly and issued an Employment Tribunal claim. Firstly, the Tribunal found that he could not claim direct discrimination because the correct comparator would be a woman on additional paternity leave, who would have been paid the same. For indirect discrimination, the Tribunal found that he had been disadvantaged, but that Ford had justified this because the reason for the difference in treatment was that the enhanced maternity pay had been introduced as a measure to recruit and retain female workers (as Ford’s workforce was male dominated).
While it was only a Tribunal level decision and therefore not binding on other Tribunals (although we understand it may be appealed), the Shuter case will be of comfort to employers who want to stick with their current system of enhancing maternity pay. However, it was far from automatic that Ford’s argument succeeded, and they were required to justify their position based on the company’s particular circumstances. Other employers would not necessarily get away with the same argument, as their situation will be different. We therefore expect that a similar challenge could be directed at pay during shared parental leave.
Clearly it will be discriminatory to pay those who take shared parental leave at a different rate depending on their gender, so men and women should be paid the same for this. However, if a woman is entitled to enhanced maternity pay which means she will receive more if she stays on maternity leave than she (or her partner) would if they took shared parental leave, that will defeat the purpose of shared parental leave. The very basis of shared parental leave is that (after the 2 week compulsory maternity leave period) the Government have confirmed that it is up to the couple to decide who is at home with the new baby. If that is the case, is there still a need for maternity to be treated as a special case?
Despite the Government’s technical guidance, we would not be surprised at all if the position is challenged in future. The problem is that if employers are expected to offer the same benefits to those on shared parental leave as they do to those on maternity leave, this will potentially involve increased costs, and therefore could mean that employers are more likely to want to ‘equal down’ the benefits – fundamentally not what was intended in introducing the new family friendly rights.
If you would like to talk through a situation you are dealing with, or if you need advice on any aspect of employment law, please contact any member of the Pure Employment Law team (01243 836840 or [email protected]).