People Management - Enhanced maternity pay does not discriminate

Another interesting article from the team at People Management. Click on the link to find our more and register for their regular updates:

Enhanced maternity pay does not discriminate against fathers, says landmark ruling

Experts welcome Court of Appeal decision, which could have led organisations to cut maternity pay rates

The Court of Appeal has ruled that it is not discriminatory for employers to enhance maternity pay while only offering statutory pay to workers on shared parental leave (SPL).

In the latest stage of an ongoing court battle between two fathers and their employers – Capita and the Chief Constable of Leicestershire Police – the court upheld a previous ruling that the employers were allowed to offer enhanced maternity pay without the need to provide the same benefits through SPL.

The judges ruled that the predominant purpose of maternity leave – even beyond the statutory two weeks – was not about childcare but for the mother to recover from the birth. This was not a need shared by her partner, and it was therefore not discriminatory to offer more generous maternity leave.

The court also ruled there was not an equal pay case to be made because the law allowed employers to make exceptions for women who are pregnant, have recently given birth or who are breastfeeding.

A number of experts have said firms will see the judgment as positive because a ruling in the opposite direction could have seen many employers pulling their enhanced maternity packages.

“If the court had held that statutory paternity pay should be enhanced for men then the likely outcome would have been companies withdrawing enhanced maternity pay, so that they did not have to match it,” said Beverley Sunderland, managing director of Crossland Employment Solicitors.

She added that while the decision may have appeared unfair to some observers, the practical outcome was positive.

Similarly, Jane van Zyl, chief executive of Working Families, said she was concerned a ruling of sex discrimination could have undermined the protection maternity leave afforded women.

“The distinct disadvantage that women face in the workplace having experienced pregnancy and childbirth must continue to be recognised in law,” van Zyl said. “Because maternity leave is designed to protect women’s health and wellbeing, it cannot simply be equated with ‘childcare’.”

Working Families made written submissions in both appeals to the court, having previously intervened in both cases in the employment appeal tribunal.

The ruling was a result of two cases heard together earlier this month and brought by Madasar Ali and Anthony Hextall against Capita and Leicestershire Police respectively.

Ali claimed that Capita directly discriminated against him by paying him less than a woman on maternity leave, arguing that only the first two weeks of compulsory maternity leave were necessary to protect a mother following childbirth and taking subsequent maternity leave, rather than switching to shared parental leave, was a “choice” about providing care.

He argued that shared parental leave “reflects a policy of giving greater choice to the families about childcare and encouraging shared parenting, as well as equalising work opportunities for women and men”, and said there should not be a “financial incentive to a birth mother to stay at home”.

Hextall argued his employer’s policy of paying women on maternity leave more than those on shared parental leave indirectly discriminated against men, and that gender equality clauses should include a modification giving fathers leave and pay at the same rates as a police officer taking maternity leave.

But the Court of Appeal rejected both arguments, saying there was “nothing unusual” about either organisation’s parental leave policy.

The judges did not agree with Ali’s argument that, after the compulsory two weeks of maternity leave following birth, the purpose of statutory maternity leave is the facilitation of childcare. They said the predominant purpose of such leave is “not childcare but other matters exclusive to the birth mother resulting from pregnancy and childbirth and not shared by the husband or partner”.

In Hextall’s case, Leicestershire Police told the court Hextall had incorrectly pleaded his indirect discrimination claim, and his complaint was about equal pay.  

The court then went on to rule Hextall could not have been successful with an equal pay claim because the law allows employers to make exceptions to women who are pregnant, have recently given birth or whom are breastfeeding.

The judges said Hextall’s complaint was “in reality an attack on the whole statutory scheme … under which special treatment is given to birth mothers [ignoring] the fact that shared parental leave is not available at all (whether to the father or the mother) unless the mother has decided to terminate her maternity leave”.

Jenny Arrowsmith, employment partner at Irwin Mitchell and who acted on behalf of Capita, said the ruling made it clear there was no room for a direct, indirect or equal pay claim arising from paying women on maternity leave more than parents on shared parental leave.

“This decision will be welcomed by employers that pay higher rates to women on maternity leave than to parents on different types of family leave. It’s also good news for women,” Arrowsmith said.

“Had the decision gone the other way, employers may have reduced their maternity pay to statutory rates because they could not afford to equalise pay rates to those taking shared parental leave.”

Holly Gregory Associates are providers of HR Consulting and Change Management Services. As HR Practitioners we have both the in-depth knowledge of the HR landscape (current and future HR strategy) but also experienced Change Agents, so you get two in one: HR Employer Services but also HR Project Management. We are known as trusted advisers, safe pair of hands, get in the dirty quickly, have cross sector knowledge, including both the UK and EMEA. We will work with you to implement appropriate new policies and procedures in the best way possible.

Our Outsourced HR Service for small business will suit if you do not currently have the resources to employ a full time HR Manager, especially as we cover a wide range of HR disciplines. It may be the right time to consider the total HR Managed Services package, or nice to be able to pick and mix bespoke elements e.g. Recruitment, Interim HR Business Partner, Disciplinary, Grievance, HR Operations or help with Redundancy and Employee Relations. We can also act on a retainer for a couple of days a month for some HR oversight and advice e.g. managing Employee Performance, TUPE Regulations or what you need to do to ensure you are complaint with the IR35 Legislation.

Our Change Management services tend to suit companies wanting HR change skills, and we have specialist knowledge which comes in handy when managing, for example, TUPE Mergers, HMRC IR35 Private Sector, Business Restructuring, Organisation Design and/or Digital Transformation. When we deploy changes the fact that we are also tech savvy, is an added benefit to our clients, including providing an independent evaluation on which HR Software or HR Solution they may need e.g. is it HRMS or HRIS?