Long term readers may recall our bulletin in July 2017 regarding the case of Mr Ali v Capita Customer Management Limit. A link to the bulletin can be found here.
Whilst I won’t repeat the detailed judgment in this bulletin, the employment tribunal held that failure to pay Mr Ali enhanced shared parental pay where there was an internal policy offering enhanced pay to women on maternity leave, amounted to direct sex discrimination.
This finding caused ripples of concern for HR teams with legal and HR commentary that changes would need to be made to internal policies. We considered the judgment in great detail and it was our opinion that the case had been wrongly decided. We urged employers not to make knee-jerk reactions because of the judgment and we were confident that the matter would be appealed. We are pleased to say that the case was recently heard in the Employment Appeal Tribunal and they have overturned the original employment tribunal judgment.
In its findings the EAT stated that the purpose of maternity leave and pay is for the health and wellbeing of the mother. This is where the EAT believed that the tribunal erred in its approach, as they were of the belief that maternity leave/pay was for the benefit of the child’s welfare. As a result, the EAT was required to reconsider who the correct comparator was for the purposes of a sex discrimination claim. It was the EAT’s opinion that the correct comparator for Mr Ali’s claim should have been a woman on shared parental leave and not a woman on maternity leave. As the shared parental leave offering was the same for both male and female, there could therefore be no finding of discrimination.
The EAT did, however, urge caution in future claims of the same nature. In handing down the judgment, the Honourable Mrs Justice Slade commented that there may be an argument in future that after the period of ordinary maternity leave (the 26 week mark) it may be more difficult for employers to argue that the leave/pay is purely for the benefit of the mother. We would go a step further and ask whether questions should be asked of the same after the 14 week mark which is set out in the Pregnant Workers Directive as the period for health and wellbeing of the mother. It will be interesting to note future developments in this area and, in particular, any consideration by tribunals as to what point the purpose of the maternity leave/pay shifts from the wellbeing of the mother to the care of the child.
At the time of going to press, we have been made aware that the judgment in the case of Hextall v Chief Constable of Leicestershire Police, heard by the EAT in January 2018, is due to be handed down today. This may go some way to answering the 26 or 14 week question as set out above. We will update you as soon as we have seen the judgment.
What should you be doing now?
The case of Mr Ali should have little effect in respect to your internal policies. It is still legal to offer enhanced maternity pay whilst not reflecting the same for shared parental leave. Until the question with regards to the 26 or 14 week issue is ironed out, employers should safely be able to continue to apply policies in respect of the same.
Our twitter feed will have the judgment on the Hextall case as soon as it is released and should be your first stop for breaking employment news.
What does this mean for your business?
Whilst it is acknowledged that a number of employers did buckle upon reading the original employment tribunal judgment and change their maternity policies, businesses should be careful to ensure that any family friendly policies are non-contractual in nature. This allows greater flexibility for companies to change the policies without potentially breaching contracts of employees.
A copy of the Employment Appeal Tribunal’s judgment can be found here.
These notes have been prepared for the purpose of articles only. They should not be regarded as a substitute for taking legal advice.