Court of Appeal: employers can enhance maternity pay without increasing shared parental pay

The Court of Appeal has handed down its judgment in the cases of Ali v Capita and Hextall v Chief Constable of Leicestershire Police.

It ruled that employers that enhance maternity pay do not discriminate against men taking shared parental leave paid at lower or statutory rates.

Facts

In Ali, women were entitled to maternity pay of up to 39 weeks, with the first 14 weeks paid at full pay followed by 25 weeks of lower rate statutory maternity pay. Parents taking shared parental leave received statutory shared parental pay only.

In Hextall, the Police operated a similar policy – women were entitled to 18 weeks full pay followed by 39 weeks of statutory maternity pay whilst those on shared parental leave were only paid at statutory rates.

Despite the similarity of the claims, they were pleaded differently in the appeal courts. Mr Ali argued that paying him less than a woman amounted to direct discrimination. Mr Hextall argued that the policy of paying women on maternity leave more than those on shared parental leave indirectly discriminated against men.

Decision of Court of Appeal

In a clear and unanimous judgment, the Court of Appeal rejected both claims.

Mr Ali tried to persuade the Court that only the first two weeks of compulsory maternity leave are necessary to protect a mother following childbirth and, after that, remaining on maternity leave (rather than switching to shared parental leave) was a ‘choice’ about providing care. He argued that times had changed and that there shouldn’t be a financial incentive for the birth mother to stay at home.

The Court disagreed. It said that the ‘entire period of maternity leave, following childbirth, is for more than facilitating childcare’. In particular, it helps women prepare and cope with the later stages of pregnancy, recuperate from giving birth, bond with their child, breastfeed and care for their new born. By contrast, shared parental leave was predominately about childcare.

The legal arguments in Hextall were more complicated. The Police argued that Mr Hextall had incorrectly pleaded his claim and that his complaint was about inequality of terms (equal pay) - not indirect discrimination.  

The Equality Act incorporates a sex equality clause in all contracts of employment where an individual does work that is equal to the work done by a comparator of the opposite sex. This means that men and women should be paid at the same rates for doing the same job. Mr Hextall argued that the sex equality clause should modify his terms of work by including a corresponding term giving him leave and pay at the same rates as a police officer taking maternity leave.

The Court agreed that this issue was about inequality of terms but said  that Mr Hextall wouldn't have succeeded anyway because the law allows employers to make exceptions to women who are pregnant, have recently given birth or whom are breastfeeding.

It also said that an indirect discrimination claim would have failed too for much the same reasons Mr Ali's claim failed - shared parental leave can't be compared to maternity leave.

Need more information?

Our partner, Jenny Arrowsmith acted for Capita and shares her thoughts on these cases:

“The Court made it clear that that there is no room for a direct, indirect or equal pay claim arising from paying women on maternity leave more than parents on shared parental leave. My client was correct to resist this claim. Its policies were similar to those of many other employers. Parliament has made a statutory exception which gives special treatment to a woman in connection with pregnancy or childbirth. That special treatment is, by definition, not available to anyone other than a birth mother, which means the partners of birth mothers are not discriminated against if they do not receive enhanced benefits for taking leave to care for their newborn.

“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. 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 – something Working Parents acknowledged in their submissions.”

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