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In Ali v Capita Customer Management Ltd and Chief Constable of Leicestershire v Hextall, the Court of Appeal considered whether it was unlawful discrimination to pay men on shared parental leave (SPL) less than mothers on paid maternity leave. Whilst the decision may be welcomed by employers who now have some clarity on the issue of SPL and pay, many may see the decision as reinforcing gender stereotypes which are not consistent with the modern world.

Shared Parental Leave

SPL allows parents to choose to share between them up to 52 weeks of maternity leave and up to 39 weeks Statutory Shared Parental Pay (ShPP). At present, there is no legal obligation for employers to offer enhanced pay for employees who opt to take SPL.

The Court of Appeal heard the two cases together and they both involved fathers who had taken, or wanted to take, SPL. The employers of the fathers in both cases offered enhanced maternity leave pay to female employees taking maternity leave whilst only offering the fathers ShPP. The question for the Court of Appeal was whether this constituted discrimination.

Ali v Capita

Following the birth of his daughter, Mr Ali took two weeks of paternity leave at full pay. Subsequently, he sought to take further time off at the same rate as a female colleague would be entitled to on maternity leave. Mr Ali was informed by his employer that he was only eligible for SPL at the ShPP. Mr Ali argued that this constituted direct discrimination, in that he would be paid ShPP for his remaining SPL whereas a female colleague taking maternity would receive full pay for the first 14 weeks. Mr Ali argued that SPL and maternity leave, after the first two weeks of compulsory maternity leave, served the same purpose. Mr Ali was successful at the Employment Tribunal (ET), however the Employment Appeal Tribunal (EAT) overturned this decision finding that there was no valid comparison between Mr Ali and a woman taking maternity leave. Moreover, the special provision of section 13(6)(b) of the Equality Act (EA) was applicable, which states that in making comparisons between men and women no account is to be taken of “special treatment” afforded to women in connection with pregnancy or childbirth. Mr Ali appealed to the Court of Appeal.

Direct discrimination

The Court of Appeal ultimately held that there was no direct discrimination against Mr Ali. A man is not treated less favourably than a woman during maternity leave because he does not receive the same pay. While parental leave was held to be for care purposes, maternity leave is for other matters exclusive to the birth mother that have resulted from pregnancy or childbirth and which are not shared by the male partner. The appropriate comparator for Mr Ali would be a woman claiming SPL who would not have been treated differently.  Section 13(6)(b) was not to be interpreted narrowly and ultimately men on parental leave and women on maternity leave are to be regarded as materially different. Accordingly Mr Ali’s direct discrimination claim was dismissed.

Chief Constable of Leicestershire Police v Hextall

Mr Hextall was a police constable who sought to take 14 weeks SPL. His employer, the Leicestershire Police Force, offered female constables on maternity leave 18 weeks enhanced maternity pay. Mr Hextall, as a father on SPL, was only entitled to ShPP. Mr Hextall argued this was both direct and indirect sex discrimination. In respect of the latter, Mr Hextall had argued that his contract of employment had less favourable terms and conditions that resulted in a particular disadvantage to men and to him individually. Further, Mr Hextall argued that this was not objectively justified and this was therefore indirect sex discrimination. The ET rejected this argument. On appeal, the EAT determined the ET had got it wrong. On further appeal to the Court of Appeal, however, the Chief Constable argued that Mr Hextall’s indirect discrimination claim should properly be treated as a claim for equal pay.

Equal pay

The Court of Appeal dismissed Mr Hextall’s claim and allowed the Chief Constable’s cross-appeal. The Court of Appeal agreed that the correct interpretation of Mr Hextall’s claim was one of equal pay relating to terms of work. Generally, equal pay claims are reliant on the sex equality clause implied by section 66 of the EA in all terms of work. Sex equality is implied unless it is specifically excluded elsewhere in the EA. Where an exclusion applies, the sex equality clause does not exist and there is no valid equal pay claim. In this case, the equal pay claim could not succeed due to an exception in EA Schedule 7 Paragraph 2 (similar to that referred to above in relation to direct discrimination claims). The exception provides that the sex equality clause does not apply in relation to terms of work that afford special treatment to women in connection with pregnancy or childbirth.

Indirect discrimination

Mr Hexall was also prevented from bringing an indirect discrimination claim because of the “mutual exclusivity” provision of section 70 of the EA. The “mutual exclusivity” provision generally prevents the basis of an equal pay claim being brought as a sex discrimination claim. Furthermore, the Court decided that even if an indirect discrimination claim had been competent it would have failed because women on maternity leave would require to be excluded from any pool for comparison, which would mean that men could not be said to be at a particular disadvantage. In any event, even if that was incorrect, the Court decided that any disadvantage of the Claimant was justified as achieving the legitimate aim of providing special treatment to mothers in connection with pregnancy or childbirth. The Court went as far as stating that any rule requiring employers to equalise payment for maternity leave and SPL would eliminate that special treatment and considered that this would be contrary to the European case law and indeed the policy of the EA.

Comment

The good news for employers is that the decision offers some clarity on whether there is a legal obligation to enhance SPL pay. The short answer is a no and in the situation where an employer enhances maternity pay but does not enhance SPL pay, this will not amount to unlawful discrimination. Prior to this decision, the uptake of SPL was already negligible and the decision is unlikely to have any real economic impact for employers.

The bad news for employees is that if SPL is only paid at the statutory rate there remains a clear lack of financial incentive to take it. It will simply not make financial sense for many families for a mother to opt out of enhanced maternity pay and re-enter work when a father would only then receive ShPP during SPL.

While Mr Ali’s claim of direct discrimination was a difficult one to advance, the rationale of the decision in Hextall is slightly more surprising. Both Mr Ali and Mr Hextall have been allowed leave to appeal the decision and whether the Supreme Court will uphold the decision remains to be seen. In any event, it can be argued that the Court of Appeal’s comments that it would be contrary to policy to require employers to match payment for SPL with maternity leave serve to reinforce the traditional gender stereotype that women are the most appropriate primary carer and men are the most appropriate bread winner.  The decision, therefore, appears to do little for advancing the goal of overcoming the significant “motherhood penalty” that is a source of significant disadvantage to women in the workplace and with knock-on adverse implications for the gender pay gap and equality more generally.

If you have any queries about the issue discussed above, please do not hesitate to contact a member of our Employment Team.

Eric Gilligan, Partner and Pete Tolmie, Trainee Solicitor

Chambers Leading Firm 2019

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