Is it discrimination not to enhance shared parental leave pay?
We reported last year on the debate about whether it is direct sex discrimination for an employer not to pay a man who takes shared parental leave following the birth of his child at the same rate as a woman on maternity leave. Although there is no statutory obligation to do so, the risk is that a failure to match pay could amount to sex discrimination. Two different Employment Tribunals hearing the claims by different Claimants on the same issue reached different conclusions. However, the Employment Appeal Tribunal has now provided clarity for employers.
Direct sex discrimination occurs where any employer treats an employee less favourably than they treat or would treat others, and that less favourable treatment is because of the employee’s sex. However, in order to decide whether there has been less favourable treatment, it is crucial to identify the comparator – in other words, who is the employee being compared with?
Mr C wished to take shared parental leave so that his wife could go back to work. He was told by his employer that during any period of shared parental leave, he would be paid at the statutory rate, as would a woman taking shared parental leave. Mr C issued a claim of direct sex discrimination because, after the expiry of his two weeks entitlement to paternity leave and paternity pay, he was not entitled to pay at the same full rate of pay that would be paid to a woman on maternity leave for a period of twelve weeks under the maternity leave policy. The Employment Tribunal found that the correct comparator was a woman on maternity leave, and this failure to pay Mr C at the same rate amounted to direct sex discrimination.
The EAT disagreed. It found that the Tribunal had made a decision based on its assumption or decision that the purpose of maternity leave and pay (after the two-week compulsory maternity leave period) is care of the child, and that the Tribunal had therefore concluded that the mother was being paid more than the father would be entitled to for performing the same role.
The EAT held that this is incorrect. It noted that the purpose of maternity leave is to safeguard the health and wellbeing of a pregnant woman, one who has recently given birth and/or who is breastfeeding. Whilst a woman on maternity leave will no doubt take care of her baby, that is not the primary purpose of such leave. By contrast, the purpose or reason for shared parental leave is for the care of the child.
It found that the correct comparator in this case is a woman on shared parental leave. Parents of either sex are given shared parental leave on the same terms. The EAT noted that inevitable conclusion in this case was that Mr C was not discriminated against on grounds of sex by being entitled to parental leave at the pay rate appropriate for that leave.
Employers can, of course, decide to pay enhanced pay during periods of shared parental leave if they do so for periods of maternity leave. There may well be good commercial reasons for doing so, including retaining and motivating employees with attractive benefits. However, there is no statutory right to enhanced pay during shared parental leave and the EAT has, at least for the time being, given some comfort to employers that a failure to enhance shared parental pay will not amount to discrimination.
13 April 2018
If you would like to receive monthly employment law updates and news of our events, sign up for our email alerts.
©2018 SCRASE LAW LTD. THIS POST IS FOR GENERAL INFORMATION ONLY AND IS NOT ADVICE. YOU ARE RECOMMENDED TO SEEK COMPETENT PROFESSIONAL ADVICE BEFORE TAKING ANY ACTION ON THE BASIS OF THIS POST.