Failure to give a male employee enhanced shared parental pay is not discriminatory

Employment Law

Failure to give a male employee enhanced shared parental pay is not discriminatory

This is the first case in which an appellant court has considered the legality of enhanced shared parental pay, the Employment Appeal Tribunal (EAT) in Capita Customer Management Limited (CCM) v Ali and Anor has overturned the Employment Tribunals (ET) decision.

The ET found that a male employee was directly discriminated against due to his sex on the basis that his employer failed to pay enhanced shared parental pay equivalent to maternity pay that a woman on maternity leave would receive.

Background

Mr Ali was a father who was employed by CCM following a TUPE transfer. It was the company’s policy that a transferred woman on maternity leave would be entitled to maternity pay which comprises of 14 weeks of basic pay and 25 weeks statutory maternity pay. Males on paternity leave would be entitled to 2 weeks paternity pay and, if they wished to take more parental leave, they could have up to 26 weeks more which may or may not be paid. 

Mr Ali’s wife wished to return to work, so it was agreed with his wife that Mr Ali would take shared parental leave. After making enquiries, Mr Ali was told that he was entitled to shared parental leave but would only be paid statutory parental pay. Mr Ali raised a grievance as he believed that he should be paid the same as what a woman on maternity leave would be paid. The grievance was not upheld and Mr Ali brought a claim to the ET accusing CCM of, among other things, directly discriminating against him on the grounds of sex.

Employment Tribunal Decision

The ET held that CCM had directly discriminated against Mr Ali on the grounds of sex and, Mr Ali could compare himself to a hypothetical female transferred employee taking care leave to care for her child. The Tribunal did not find that any preferential treatment should be given to a woman owing to pregnancy and childbirth.

The ET agreed that men should be taking shared parental leave as parents are free to choose who is to be the carer for the child and, that women after the compulsory two weeks should not have more rights than a man. Thus, should be equally paid.

CCM appealed against this decision.

Appeal

The EAT allowed the appeal and disagreed with the ET’s decision. The EAT pointed out that the EU Pregnant Workers Directive was enforced for the purpose of the health and wellbeing of the pregnant and birth mother. This directive requires that mothers must be paid at least the same amount as statutory sick pay for 14 weeks on maternity leave. They went on to say that the Parental Leave Directive only focuses on the care of the child and makes no provision for pay. The EAT said that the ET’s decision rested on the reasoning that the purpose of maternity leave and pay, after the first two weeks compulsory leave is for the care of a child.  The EAT expressed that whilst a woman on maternity leave will take care of her baby, that is not expressed as or is the primary purpose of such leave.  In contrast, the purpose for shared parental leave is to care for the child.

The EAT also found that Mr Ali used the wrong comparator. Mr Ali compared himself with a mother on maternity leave and their pay. However, the correct comparator would be a woman on shared parental leave, who would have bene given shared parental leave on the same terms as Mr Ali.

The EAT concluded that Mr Ali was not discriminated against on the ground of sex.

Comment

This case is of importance to male and female employees as well as employers.  In research carried out but Working Families, it found that 1/3 of fathers said they would not take up their right of shared parental pay because it was unaffordable.  On the findings of this case it appears unlikely that fathers will be encouraged to take shared parental leave if the pay remains at a statutory level and is not enhanced. On the flip side, many businesses will be breathing a sigh of relief as this does not mean that they need to review and increase statutory shared parental pay.

Interestingly, by comparison, in Sweden, Norway and Iceland, new parents are paid between 80%-100% of their income during their leave and between 85%-90% of fathers use their leave. Perhaps we have something to learn?