Not all pay is equal

Many employers pay enhanced maternity pay for women when they are on maternity leave. Most of these arrangements were introduced before the right to shared parental leave was introduced in April 2015.

The dilemma now facing employers is what should they pay to those who opt to share their partner’s maternity leave?  The statutory requirement is to pay ‘shared parental pay’, which if eligible for amounts to a maximum of £148.88 per week.  But if you pay more to a woman on maternity leave, should you pay the same to those on shared parental leave?

This question has now been answered by the Court of Appeal when it was called upon to decide two cases (Hextall v Chief Constable of Leicestershire Police and Ali v Capita) in which men were paid less when they took shared parental leave than their female counterparts taking maternity leave.

At both places of work, women were entitled to maternity pay for up to 29 weeks, with 14 weeks full pay at Capita and 18 weeks full pay at Leicestershire Police. In both cases, parents taking parental leave received only statutory shared parental pay.

Mr Hextall argued that paying women on maternity leave more than parents on shared parental leave indirectly discriminated against men, while Mr Ali argued that receiving less than a woman was direct discrimination.

The court rejected both claims, saying there was nothing unusual about the policies.

When reaching its judgment the Court highlighted the statutory exemption that afforded women special treatment in relation to pregnancy and giving birth. Women on maternity leave are given this treatment to recover from childbirth, cope with pregnancy and bond and care for their newborn child.

The judges in the Ali v Capita case ruled that the arguments put forward were an “attack against the whole statutory scheme”.

They added that the “entire period of maternity leave, following childbirth, is for more than facilitating childcare.”

In the Hextall v Leicestershire Police case, the Court agreed with Leicestershire Police that Hextall’s claim was about equal pay, rather than indirect discrimination.

However, because the law allows employers to make exceptions for women on maternity leave, this claim could not be successful.

David Scott, Senior Associate Solicitor in Hethertons employment tea,m said: “Whilst we will have to see if there is a further appeal to the Supreme Court, as it stands now an employer need not pay an enhancement to shared parental pay even when they offer enhanced payment for those on maternity leave.

“Of course, this does not prevent an employer from paying shared parental pay and maternity pay at the same rate if they wanted to.

“There are clear advantages to employers in having a simple system covering both types of leave – giving clarity to employees, promoting perceived fairness, equality and diversity.  If the courts maintain this position then it may be something that Parliament will need to address in the future.”

Hethertons appreciate the dilemmas and difficult decisions employers face on a daily basis.  Our ‘HELP!’ package can make some of those dilemmas a little less daunting to face.