Is an employer obliged to pay enhanced pay for shared parental leave?
In June 2017, we reported on the Podcast about an Employment Tribunal case where a male employee, Mr Ali, successfully claimed direct sex discrimination when his employer refused to pay him enhanced shared parental leave pay. You can listen here. Mr Ali’s employer appealed the decision and it has recently been decided by the Employment Appeal Tribunal
Parents have the option of dividing leave after the birth of their child by taking shared parental leave (SPL). Essentially it allows the mother to give up her right to one year’s maternity leave so that she and her partner can share the leave or the partner can take all the leave instead (except for the first 2 weeks after childbirth which are compulsory for the mother to take).
Shared parental pay is paid to both men and women at a flat rate set by the government.
Direct sex discrimination occurs where, because of sex, a person (A) treats another (B) less favourably than A treats or would treat others.
Mr Ali was employed by Capita Customer Management Limited (the ‘Employer’).
When Mr Ali’s wife gave birth to a daughter in February 2016, he took 2 weeks paid paternity leave. After the birth, Mr Ali’s wife was diagnosed with post-natal depression and was advised that a return to work would aid her recovery. Mr Ali wanted to take Shared Parental Leave so that he could look after his daughter and argued that, because his Employer paid full pay for the first 14 weeks of maternity leave, he should be entitled to the same higher rate of pay. The Employer refused and said it would pay Mr Ali statutory parental pay only. Mr Ali brought claims of discrimination in the Tribunal arguing he was entitled to the same higher rate of pay as a female employee on maternity leave.
Mr Ali won his claim for sex direct discrimination in the Employment Tribunal, where it was held that he could compare himself with a hypothetical female colleague who was taking on a child caring role. The Tribunal considered that the purpose of providing enhanced maternity pay on maternity leave was to assist female employees in that time to care for their new born child, and this was the same as what Mr Ali was going to do during his shared parental leave. The Employer appealed.
The Employment Appeal Tribunal held that the Employment Tribunal had erred in law by deciding it was direct sex discrimination to refuse to pay a father enhanced shared parental pay in line with enhanced maternity pay.
The Appeal Tribunal said that the Tribunal was wrong to compare the father’s circumstances to a woman who had just given birth (on the basis that both were taking leave to care for their child) because this finding ignored the purpose of maternity leave and pay under statutory law which is for the health and well-being of expectant and new mothers.
Points to note
The decision of the Appeal Tribunal is reassuring for employers who pay enhanced maternity pay and is a useful reminder of why special protection is afforded to women during pregnancy and following childbirth. It does however mean that the low take up of shared parental leave by fathers is set to continue. Interestingly, the Appeal Tribunal did not rule out the possibility of a claim for direct sex discrimination arising where enhanced maternity pay is continued over a longer time period.
The claim in this appeal was for a father to be paid at the rate of pay a mother receives for maternity leave in the first fourteen weeks after birth. The Appeal Tribunal said it may be that the purpose of maternity leave may change after a period of 26 weeks from the “biological recovery from childbirth and special bonding period between mother and child”. At that point, the Appeal Tribunal said, it may be possible to draw a valid comparison between a father on shared parental leave and a mother on maternity leave.
Action to take
When we reported on this case last year, our advice was to hold off from changing your maternity policies and to sit tight and wait for a binding appeal decision. Now we have it – there is no legal requirement to enhance shared parental leave in line with enhanced maternity pay in the first 14 weeks after childbirth.
However, be cautious if you pay enhanced maternity pay for a considerably longer period, particularly if you pay more than 26 weeks, as this is likely to be challenged in the future. If in doubt, seek legal advice.