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Court of Appeal considers Shared Parental Leave cases

In a nutshell

Failure to pay two male employees enhanced shared parental pay did not constitute direct or indirect sex discrimination, rules Court of Appeal

In the long-awaited judgment of Ali v Capita Customer Management Ltd; Hextall v Chief Constable of Leicestershire Police [2019] EWCA Civ 900, the Court of Appeal considered whether it was direct or indirect sex discrimination, or breach of equal pay requirements, to offer different rates of pay for mothers on maternity leave and fathers on shared parental leave.

They confirmed that it was not.

The facts of the cases

Ali v Capita Customer Management Ltd

Mr Ali was entitled to take two weeks’ paternity leave, whereas female staff were entitled to 14 weeks’ enhanced maternity leave. He therefore sought to take shared parental leave, after the first two weeks, at the same rate of pay as a female employee taking enhanced maternity leave. This was not permitted as it was the Company’s position that shared parental leave and pay mirrored statutory arrangements (as opposed to enhanced rates). Mr Ali argued that this was unlawful direct discrimination on the grounds of sex.

The Employment Tribunal (ET) found in favour of Mr Ali with regards to direct discrimination.  However the Employment Appeal Tribunal (EAT) disagreed, concluding that he could not compare himself with a woman on maternity leave. The primary purpose of maternity leave is the health and wellbeing of the mother, whereas the purpose of shared parental leave is to care for the child. Mr Ali could therefore only compare himself with a woman taking shared parental leave (in respect of which there was no difference between the rates for men and women).

Hextall v Chief Constable of Leicestershire Police

Mr Hextall was entitled to share parental leave in line with statutory arrangements, whereas female staff were entitled to received 18 weeks of maternity leave at full pay. Mr Hextall claimed he had been indirectly discriminated against as enhanced pay was not given for shared parental leave and the policy therefore put men at a particular disadvantage.

The ET did not agree and dismissed Mr Hextall’s claims. The EAT, however, held that the ET had erred in reaching its decision as it did not use the correct pool for comparison for the purposes of an indirect sex discrimination claim.

On appeal, the police argued that Mr Hextall’s case should have been treated as a breach of his terms of work, rather than as an indirect discrimination claim.

In respect of his equal pay claim, Mr Hextall argued that the sex equality clause should be read into his employment contract so that he would get leave and pay at the same rates as an officer taking maternity leave.

The Court of Appeal’s decision

Mr Ali and Mr Hextall appealed to the Court of Appeal; both were unsuccessful.

It was confirmed that different rates of pay for new mothers and their partners did not constitute unlawful discrimination.

With respect to Mr Ali’s contention that the pay disparity incentivised mums to take responsibility for the childcare of newborns (to the detriment of dads/partners), the judges considered that maternity leave was not just about facilitating childcare. Its primary purpose was the health and well-being of the pregnant and birth mother. It helped women to cope with the later stages of pregnancy, to recuperate from giving birth and to bond with, breastfeed, and care for their new born.

With respect to Mr Hextall’s contention about the sex equality clause, whilst the court agreed that the issue was about inequality of terms, rather than about indirect discrimination, it pointed out that the law expressly permits more favourable terms to be enjoyed by a woman as a result of pregnancy or childbirth.

The judges added that had Mr Hextall argued his case on indirect discrimination grounds, he would have failed for similar reasons as Mr Ali: maternity leave and shared parental leave have different policy objectives and are not comparable.

Where do we go from here?

Employers who have taken a “wait and see” approach can now breathe a sigh of relief as this decision allows them to continue to implement policies which offer enhanced maternity pay but not shared parental pay, without the risk facing sex discrimination claims – that is unless Mr Ali and Mr Hextall take their cases to the Supreme Court which rules otherwise.

Whilst the Court of Appeal’s reasoning makes sense (in that the policy objectives of maternity leave and shared parental leave may differ), the fact that these two cases made it to the Court of Appeal shows that fathers are willing to fight for their right to care for (and be paid to care for) their children.

The low take up rate of shared parental leave is doubtless influenced by the economic disincentive which Mr Ali’s case highlighted.

Employers who recognise that employees of both genders may wish to take time out to care for their children, and who facilitate this (perhaps by paying enhanced shared parental leave, as well as enhanced maternity leave, where they are able to do so) may be more attractive to potential employees, and more successful in retaining existing ones.

If you would like to discuss anything further, please contact Employment Solicitor, Heena Kapadi, on T: 0161 358 0540 or E: heenakapadi@hrclaw.co.uk.

This bulletin contains general overview information only. It does not constitute, and should not be relied upon, as legal advice. You should consult a suitably qualified lawyer on any specific legal problem or matter.