Many employers pay enhanced rates of maternity pay, over and above the statutory minimum, to mothers on maternity leave. As we discussed in our previous article, it used to be argued that employers who paid enhanced maternity pay didn’t have to pay enhanced paternity pay, on the basis that maternity is a special case linked to pregnancy.
However, as shared parental leave (which was introduced for parents whose babies were expected after 5 April 2015) can be taken by either parent, should employers who pay enhanced maternity pay also be paying shared parental pay at an enhanced rate?
The recent case of Ali v Capita Customer Management Ltd concerned Mr Ali, an employee who, following the birth of his child, took 2 weeks’ paternity leave (at full pay) followed by some annual leave and then returned to work. Mr Ali’s wife was advised to return to work to assist her recovery from post natal depression, and Capita told Mr Ali that he could take shared parental leave to care for their child. Whilst Capita paid enhanced maternity pay to mothers for 14 weeks, they told Mr Ali that he would only be paid the statutory rate of shared parental pay should he take shared parental leave.
Mr Ali was deterred from applying to take shared parental leave because he would not receive an enhanced rate of pay and he brought a claim against Capita for direct sex discrimination.
Mr Ali argued that after the two weeks’ compulsory maternity leave which mothers are required by law to take, either parent could care for the baby and so to only pay him statutory pay would amount to less favourable treatment on the grounds of his sex. He argued that he should therefore receive enhanced pay for up to a further 12 weeks.
Capita argued that the special treatment afforded to mothers on maternity leave extended for the whole of the 14 week period. They also argued that all staff who take shared parental leave, whether male or female, receive statutory shared parental pay.
In upholding Mr Ali’s claim, the Employment Tribunal accepted that the correct hypothetical person for Mr Ali to compare himself to was a female colleague taking leave to care for her child (after the 2 week compulsory period).
Mr Ali had raised a grievance with Capita, and the Tribunal noted that the grievance process was “unnecessarily long and drawn out”, and had resulted in a very short outcome letter which did not address Mr Ali’s complaint of sex discrimination. The Tribunal also noted that Capita had not reviewed its policy in light of Mr Ali’s complaint, to consider whether it was applied to him in a discriminatory way.
Mr Ali’s claim for indirect discrimination failed, however, because the maternity policy was not gender neutral i.e. it was not something applied equally to all staff but which disadvantaged men.
The decision in Mr Ali’s case conflicts with the decision in the earlier case of Hextall v Chief Constable of Leicestershire Police. In the Hextall case, the Tribunal found that the police force’s policy of paying enhanced maternity pay but only statutory shared parental pay was not discriminatory, because a female employee taking shared parental leave who was the same sex partner of a woman on maternity leave would also only be paid statutory shared parental pay.
The decision in Mr Ali’s case, and the decisions in the only two other cases concerning shared parental leave so far have been at Tribunal level only, so they are not binding. However, we understand that both Ali v Capita Customer Management Ltd and Hextall v Chief Constable of Leicestershire Police are being appealed to the Employment Appeal Tribunal, so we will keep you informed of any developments in this area.
The safest approach for employers who pay enhanced maternity pay, is to also pay shared parental pay at the enhanced rate. Alternatively, employers could pay the statutory minimum pay for each type of leave regardless of who is taking it – but changing existing arrangements can be difficult, so it is always best to take advice.
If you would like to talk through a situation you are dealing with, or if you would like help with any policies or need advice on any aspect of employment law, please contact any member of the Pure Employment Law team (01243 836840 or [email protected]).