Employment Law Bulletin April 2018

EAT rules that there was no direct discrimination where company paid enhanced maternity pay but not enhanced shared parental pay.

In Capita Customer Management Limited v Ali the Employment Appeal Tribunal (‘EAT’) considered whether it was directly discriminatory on the grounds of sex for Capita to offer enhanced maternity pay to birth mothers whilst only offering statutory shared parental pay to fathers taking shared parental leave (‘SPL’).

The EAT decided that it was not directly discriminatory in this instance.

The original employment tribunal had observed that men are now being encouraged to have a greater role in childcare. It said that someone in Mr Ali’s position (i.e. taking SPL) should be compared to a woman taking maternity leave. It said that since the woman in this comparable situation was paid more than the man – purely on the basis of sex – to enhance maternity pay but not shared parental pay was directly discriminatory against Mr Ali.

Capita appealed to the EAT.

The EAT allowed the appeal and overturned the tribunal’s decision. The EAT said that Mr Ali should have compared himself to a female partner of a birth mother who was taking shared parental leave and not to a woman taking maternity leave. Since a female partner of a birth mother would be getting the same shared parental pay package he was, it was not directly discriminatory against men.

In order to establish the correct comparator in direct discrimination cases there must be no material difference in the circumstances of the comparators. The EAT noted that there was a material difference between maternity pay and SPL. It said that while a woman on maternity leave will no doubt take care of her baby, that is not the expressed or primary purpose of such leave. In fact, the purpose of maternity leave according to the EU Pregnant Workers Directive is for the health and wellbeing of the birth mother. By contrast (so said the EAT) the purpose of or reason for SPL is for the care of the child.

The EAT therefore said it is not possible to draw a valid comparison between a father on shared parental leave and a mother on maternity leave. In the EAT’s view, the correct comparator would therefore be a woman on shared parental leave and the contrasting levels of pay were not directly discriminatory.

This case will be welcome news for many businesses which have historically offered enhanced maternity pay but have not yet rolled out any policy of enhanced shared parental pay. Such business should nonetheless be aware that this is likely to be a developing area and they should keep up to date with developments in case law in this area.