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Legal-ease: Enhanced SPL pay

It's not discriminatory for employers to offer enhanced maternity pay but not enhanced Shared Parental Leave (SPL) pay

On 24 May the Court of Appeal delivered its decision in the cases of Capita v Ali and Hextall v chief constable of Leicestershire. In both cases male employees claimed sex discrimination on the basis that their employers’ Shared Parental Leave (SPL) policies provided the statutory rate of pay to employees taking SPL, while their maternity leave policies provided for enhanced maternity pay. The Court of Appeal has ruled that this is neither direct nor indirect discrimination.

For direct discrimination the correct comparison is between a man and a woman taking SPL – not between a man taking SPL and a woman taking maternity leave. This is because the predominant purpose of maternity leave is not only childcare; it also extends to other matters exclusive to the birth mother not shared by her partner or coparent, such as recuperating from the pregnancy and from the effects of childbirth. As such when comparing a man and a woman taking SPL, there is no direct discrimination because they would both receive the same rate of SPL pay.

This decision on direct discrimination is generally viewed as a correct analysis and is not surprising. What is more interesting is the ruling on indirect discrimination. The claimants’ arguments were that paying the statutory rate of pay for all employees who take SPL causes a particular disadvantage to men when compared to women. The disadvantage relied upon was that it was more difficult for a man to take the leave available to him when he would only receive the statutory rate of pay, whereas the majority of women have a full-pay alternative.

The Court of Appeal rejected this argument too. It said that the pool for comparison purposes is a group of employees whose circumstances are the same as each other (or not materially different). So women taking maternity leave had to be excluded because they are in a materially different position from men and women taking SPL. That left a pool comprised of men and women taking SPL (as opposed to maternity leave). Based on that pool, where the men and women would receive the same flat rate of SPL pay, there was no particular disadvantage to the men.

In any event, the court also found that if there were a disadvantage to men the employer could justify it as a proportionate means of achieving a legitimate aim – namely the special treatment of mothers in connection with pregnancy or childbirth.

Both claimants have asked for permission to appeal to the Supreme Court. But for now at least the legal position is clear. Employers will not be liable to a sex discrimination claim if they operate an enhanced maternity pay policy and a statutory-rate SPL pay policy.

Some employers have chosen to equalise their SPL pay policy with their maternity pay policy where the latter is enhanced above the statutory minimum. Many have not, however. And the court’s decision will reassure them that for now that practice is not unlawful.

Christopher Fisher is a partner and Jenny Watts an associate at Mayer Brown