Following the recent EAT decision which found that it was not direct sex discrimination for an employer to not offer enhanced shared parental pay whilst enhancing maternity pay (Capita Customer Management Ltd v Ali and Another - please see our previous bulletin on this), the EAT has heard another case with similar facts which has left the door open for indirect sex discrimination claims. This case has been sent back to be heard by a fresh tribunal and we will have to wait to see the decision on that. However, in the meantime it creates more uncertainty for businesses who enhance maternity pay but not shared parental pay (Hextall v Chief Constable of Leicestershire Police).
The government's position on this when shared parental pay came into force, set out in the BIS guidance, seemed to be reassuring for employers. Its view was that any differences between company pay during maternity leave and during SPL would not amount to discrimination as maternity is a protected right. However, as explained in our previous article (Can you afford not to enhance shared parental pay? ) that position was, in our view, over-simplified particularly in relation to possible claims for indirect discrimination.
The main issue in the Hextall case was that the tribunal had incorrectly applied the direct discrimination principles around who a man on shared parental leave should compare himself to. In a direct discrimination claim he would have to compare himself to a woman on shared parental pay not a woman on enhanced maternity pay. However, it is not that straightforward for indirect discrimination claims. The decision will be heard by a new tribunal and we will keep you updated.
Whilst indirect discrimination claims can be objectively justified, this may be a difficult hurdle to overcome in practice for employers. Until there is clear decision on this (and it could go through a number of courts) the safest course of action for employers is to offer consistent enhancements to such benefits. However, many employers may choose to adopt a wait and see approach.
“For employers, the question of indirect discrimination remains unresolved and we await a further tribunal decision for greater clarity. “Nonetheless employers should carefully consider the aims and benefits of enhancing one sort of pay and not the other. We’d encourage employers that can afford to do so to go beyond the minimum pay for shared parental leave, making it a more realistic option for more families.” (Chief Executive of Working Families Sarah Jackson)