In the UK, only female employees are eligible for statutory maternity leave. They are also eligible for statutory maternity pay at a fixed rate during such leave subject to certain conditions – and it is common for employers to pay enhanced maternity pay during periods of maternity leave.
Whilst many employers do not pay enhanced paternity pay to those on paternity leave, it has long been accepted that paying enhanced maternity pay is defensible under the provisions of the Equality Act which state that, when determining whether a man has been discriminated against on grounds of his gender, no account is to be taken of special treatment afforded to a woman in connection with pregnancy or childbirth.
Shared parental leave and pay
In 2015, the new scheme of shared parental leave and pay was introduced for eligible working parents. It allows the mother to choose to end her maternity leave at any time after the compulsory maternity leave period so that the untaken balance of her statutory maternity leave and pay may be taken as shared parental leave and pay by her and the father/her partner.
Government guidance has been that if employers enhance shared parental pay for female employees, they must also do so for male employees to avoid discrimination. But it is not discriminatory to pay enhanced maternity pay but not enhanced shared parental pay.
Employment tribunal judgments
As we reported in a recent post, nevertheless, in two recent cases, male employees have sought to argue that it is discriminatory for employers to pay enhanced maternity pay to their female employees on maternity leave, but to pay only statutory pay to them whilst on shared parental leave.
It was held by the employment tribunal in the first case that this practice was not discriminatory because the correct comparator for the male employee was not a woman on maternity leave but a woman who had not given birth (the same-sex partner of the mother) who was on shared parental leave. The correct comparator would also have received statutory pay only and so no sex discrimination occurred.
However, the employment tribunal in the second case held the opposite. The comparator argument was not addressed. Instead the tribunal concentrated on the argument that the payment of enhanced maternity pay could not be defended as “special treatment afforded to a woman in connection with pregnancy or childbirth” because under the new shared parental leave scheme, only the two-four week period of compulsory maternity leave (CML) is kept exclusively for the mother whilst the rest may be shared – therefore the extra pay for mothers after CML was not special treatment in connection with pregnancy or childbirth but with caring for a newborn which either parent could do.
Both decisions were appealed to the Employment Appeal tribunal (EAT) which heard the cases in December 2017 and January 2018. Judgment was handed down in one appeal on 11 April 2018. We reported on this decision in our last post. Now the EAT has handed down its judgment in the second appeal.
Judgments of the EAT
As previously reported, the EAT held in April that that it is not directly discriminatory to pay enhanced maternity pay to a woman on maternity leave but only statutory shared parental pay to a man on shared parental leave.
The tribunal had been wrong to conclude that following the period of CML, the purpose of maternity leave is childcare. The purpose of maternity leave and pay is to protect the health and wellbeing of a woman during pregnancy and following childbirth and the level of pay is inextricably linked to the purpose of the leave. The EAT held that the father could not compare himself to a woman on maternity leave.
The purpose of shared parental leave is different from that of maternity leave/pay. It is for the purposes of childcare and is given on the same terms for both men and women. There is therefore no direct discrimination when an enhanced level of maternity pay is given to mothers on maternity leave but only the statutory rate to either sex on shared parental leave.
The EAT held that, contrary to the argument raised in the employment tribunal, payment of maternity pay at a higher rate did fall under the provisions of the Equality Act as special treatment afforded to a woman in connection with pregnancy or childbirth.
However, the case concerned a claim of direct sex discrimination only.
The second appeal was against the finding at tribunal level that there was no indirect sex discrimination either. The EAT has now allowed the appeal on this point.
It concluded that the policy of paying only the statutory rate to those on shared parental leave put fathers at a particular disadvantage when compared with mothers because they have no choice but to take shared parental leave (not being entitled to maternity leave), and the lower rate of pay deters them from taking that leave.
So whilst it is now clear that paying enhanced maternity pay to a woman on maternity leave but only statutory pay to a man on shared parental leave does not amount to direct sex discrimination, the EAT has concluded that it may amount to indirect sex discrimination (which unlike direct sex discrimination is capable of justification), and has sent the case back to the employment tribunal to decide whether there was sex discrimination on the facts of the case.
Employers who enhance maternity pay but not shared parental pay will not be able to rest easy until the outcome of the next hearing.