Case update (1): Sex discrimination and shared parental leave pay

What do we already know?

We updated you in our April 2018 Newsflash Sex discrimination and shared parental leave pay on the EAT decision in the case of Capita Customer Management Ltd v Ali.

The EAT decided that the employer had not discriminated against its employee by paying him at its shared parental leave rate of pay, which was less than it paid women on maternity leave during the same time period.

What’s new?

We promised you further detail on this case in our Newsletter, so here it is…

Summary:  Is it direct sex discrimination not to pay full salary to a father taking shared parental leave, in circumstances where a mother taking maternity leave during the same period would have received full pay?

No, says the EAT in Capita Customer Management Limited v Ali, available here.

Facts:  The Employer, Capita Customer Management (“Capita”) had various policies about pay for different types of family leave.  Employees taking maternity leave were entitled to 14 weeks of full basic pay, followed by 25 weeks of statutory pay. Employees taking two weeks of ordinary paternity pay were entitled to full pay for that period, but there was no right to any additional pay above the statutory rate for Shared Parental Leave (SPL).

The employee, Mr Ali, took two weeks of paternity leave immediately after the birth of his baby. His wife was unwell with post-natal depression and had been advised to return to work, so Mr Ali asked to take SPL so that he could care for the baby. He was aware that female employees on maternity leave from Capita were entitled to 14 weeks at full pay and asked for the same treatment. When this was refused, Mr Ali submitted a grievance alleging sex discrimination. When this was not upheld, he brought various claims in the Tribunal. His main contention was that it was direct sex discrimination to provide full pay to mothers on maternity leave but not to fathers on SPL.

The Tribunal decided that this treatment of Mr Ali did amount to direct sex discrimination.

It was accepted by both sides that the initial compulsory maternity leave period of two weeks was specifically associated with recovery after childbirth, and so was unique to the mother. The Tribunal considered, however, that after this two-week period, Mr Ali could compare his treatment with that of a hypothetical female colleague on maternity leave. She would be entitled to full pay for 14 weeks, while he was only entitled to statutory pay. This was direct sex discrimination.

Mr Ali appealed to the EAT. The EAT decided that Mr Ali was not directly discriminated against on grounds of sex. The EAT considered that Mr Ali could not compare himself with a woman on maternity leave. Maternity leave has a different purpose from SPL; maternity leave is for the health and wellbeing of the mother, whereas the purpose of SPL is to care for the child. Mr Ali could compare himself with a woman taking SPL, but that is given on the same terms for both men and women and is therefore not discriminatory.

The EAT’s decision was influenced by the EU’s Pregnancy Workers Directive which requires member states to introduce legislation to enable women to take maternity leave with adequate pay for a minimum of 14 weeks (which was followed by Capita in its Maternity Leave Policy).  It is clear from the Directive that the purpose of maternity leave, and the pay associated with it, are for the health of the mother – not to look after a child (although she will no doubt do this as well).  This is evidenced by the fact that maternity leave and pay is available before a mother gives birth as well as available to surrogate birth mothers and mothers who have a still birth in late stages of pregnancy.

The rate of maternity pay is inextricably linked to the purpose and circumstances of maternity leave and it is not discriminatory for an employer to pay enhanced pay for maternity leave but not SPL.

Implications:  This is helpful reassurance for employers that they can pay women taking maternity leave more than men taking shared parental leave – at least for 14 weeks!

However, employers who are still deciding whether to introduce enhanced shared parental pay which is comparable with enhanced maternity pay may want to “hold fire” for now. The EAT is also shortly due to give its judgment in the linked case of Hextall v Chief Constable of Leicestershire Police. Mr Hextall brought a claim of direct sex discrimination in similar circumstances. However, unlike Mr Ali, he was unsuccessful at Tribunal.

We await the EAT’s decision in Hextall which we will update you on. Hopefully, on the basis of the Capita Customer Management Limited v Ali decision, Mr Hextall’s appeal will be dismissed.