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Should employers enhance shared parental pay in line with enhanced maternity pay?

Employment / 04 June 2019

In the combined appeals of Capita Customer Management v Ali and Chief Constable of Leicestershire Police v Hextall, the Court of Appeal has ruled that it was not discriminatory, nor a breach of equal pay legislation, to pay male employees on shared parental leave (“SPL”) less than female employees on maternity leave (“ML”).

For the background to both cases, please see our earlier editions of employmentlaw@work here and here.

Issue

The key issue for the Court of Appeal was whether it was sex discrimination (whether direct or indirect) or a breach of equal pay legislation for male employees on SPL to be paid less by way of enhanced shared parental pay than female employees on ML receiving enhanced maternity pay.

The Court of Appeal held that it was not.

Key Dates

The judgment was made on 24 May 2019.

Impact

In summary, the Court of Appeal found that:

  1. Direct Sex Discrimination – the correct comparator was a female on SPL, not a woman on ML.  Statutory ML was reserved for matters resulting from pregnancy and childbirth which were exclusive to the birth mother.
  2. Equal Pay – the Court of Appeal found that the second claimant’s claim was correctly characterised as an equal pay claim.  However, the Equality Act 2010 prevents a male from relying on the “sex equality clause” (which the Equality Act 2010 implies into all employment contracts) where his comparator’s more favourable terms relate to special treatment afforded to a female in connection with pregnancy or childbirth.
  3. Indirect Sex Discrimination – given that the second claimant’s claim was actually an equal pay claim, the wording of the Equality Act 2010 prevented him from also bringing an indirect discrimination claim. However, the Court of Appeal went on to say that an indirect sex discrimination claim would have failed anyway because the correct pool for comparison could only consist of employees on SPL.  Further, any disadvantage to the claimant would have been justified as being a proportionate means of achieving a legitimate aim – which in this case was the special treatment of mothers in connection with pregnancy or childbirth.

Action

Clearly, this is good news for employers who were concerned about having to pay higher rates of enhanced shared parental pay to men, or consider reducing enhanced maternity pay for women.

However, these cases will not help the uptake of shared parental leave, which has been at a low level since its introduction.

We understand that both claimants are seeking permission to appeal to the Supreme Court and so this may not yet be the end of the matter.

We will keep you updated with further developments.

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