Is Enhanced Shared Parental Pay Legal?
The EAT will hear the appeal in Ali v Capita Customer Management Ltd today on the issue of whether employers who offer enhanced maternity pay must also offer enhanced Shared Parental Pay. The joined appeal of Hextall v Chief Constable of Leicestershire Police will take place in January 2018. Siân McKinley considers the significance of these appeals in this blog.
In Ali, for the first time, the employment tribunal upheld a complaint of sex discrimination from a male employee who was refused enhanced Shared Parental Pay. In Hextall a male employee’s claim for direct sex discrimination on very similar facts was rejected. For a reminder of these decisions, see enhanced shared parental pay blog post by Rachel Crasnow QC and Siân McKinley.
Interpreting the Equality Act 2010
Discrimination between men and women is prohibited by s.13 of the Equality Act 2010 (EqA).
Part of the reason for the different results in Ali and Hextall is the approach of the tribunal when interpreting the EqA.
In Ali the Tribunal took a novel approach when accepting that the purpose of the Shared Parental Leave Regulations 2015 (to allow parents to share care of new born babies) was relevant to a claim of sex discrimination under the EqA. The tribunal directed itself that legislation had to be read in the context of parental roles and choices as they are in 2016. It explicitly reminded itself that either parent could perform the role of caring for their baby in the first year.
In Hextall the tribunal rejected any argument that a claim for sex discrimination under the EU-derived legislation should be read in line with the objectives of the subordinate domestic legislation of SPL Regulations.
With respect, the objectives of the Shared Parental Leave Regulations 2015 are entirely in line with the European position (against which the EqA must be interpreted). There have been clear pronouncements from the European Union institutions for almost 20 years now: effective equal opportunities in the workplace requires sharing of childcare responsibilities between men and women.
It is correct that the 1976 Equal Treatment Directive was not “designed to settle questions concerned with the organisation of the family, or to alter the division of responsibility between parents”[1].
However, there have been significant developments since then. As long ago as 1996, the European Parliament noted in the preamble to the original Parental Leave Directive[2] that “an effective policy of equal opportunities presupposes an integrated overall strategy allowing for better organization of working hours and greater flexibility, and for an easier return to working life, and notes the important role of the two sides of industry in this area and in offering both men and women an opportunity to reconcile their work responsibilities with family obligations”.
In 2002, the European Parliament stated in Assembly Resolution 1274:
“The issue of parental leave is closely linked to that of the role of men in family life, since it permits a genuine partnership in the sharing of responsibilities between women and men in both the private and public sphere. However, [the Assembly] is disappointed to note that, despite all that has been done, parental leave is not applied equally in all member states and motherhood is still an obstacle to women’s careers in many countries.[3]”
The European Commission and the European Parliament has been repeatedly attempting to amend the Pregnant Workers Directive[4], upon which the current right to maternity leave within the UK is based. In July 2015[5], in light of the deadlock in the Council, the Commission withdrew any proposal to amend it and instead proposed an entirely new package to ‘address the challenges of work-life balance faced by working families’.
The objective for this new initiative is to modernise and adapt the current EU legal and policy framework to allow for working parents with children or those with dependent relatives to better balance caring and professional responsibilities. This initiative is designed to encourage a more equitable use of work-life balance policies between women and men, and to strengthen gender equality in the labour market[6].
Interpreting the direct discrimination provisions of the 2010 Act in line with the purpose of the Shared Parental Leave Regulations 2015 is therefore permissible for employment tribunals. The tribunal is not interpreting EU-legislation in accordance with subordinate domestic legislation, but instead consistently with a position promulgated by EU institutions.
The Derogation
The principle that effective equal opportunities in the workplace requires sharing of childcare responsibilities between men and women is also relevant when considering s.13(6)(b) EqA. This provision states that no account is to be taken of special treatment afforded to a woman in connection with pregnancy and childbirth.
If the purpose of the measure is to protect the mother’s health and safety during pregnancy and in the period following childbirth within the meaning of the Pregnant Workers Directive, or to protect the ‘special relationship’ between mother and child in the period following childbirth, then it is likely to fall within the scope of the derogation in s.13(6)(b) of the 2010 Act[7].
Any derogation must be a proportionate means of achieving the legitimate aim of compensating the woman for the disadvantages occasioned by her pregnancy or her maternity leave (Eversheds Legal Services Ltd v De Belin [2011] IRLR 448).
However, paying enhanced pay for maternity leave but not enhanced pay for Shared Parental Leave arguably no longer achieves the legitimate aim of compensating women for disadvantages occasioned by her pregnancy or her maternity leave. On the contrary, it may do more harm than good.
Paying enhanced pay for maternity leave but not enhanced pay for Shared Parental Leave perpetuates and reinforces the assumption that working mothers are the primary caregivers of those children. If it doesn’t make financial sense for fathers to take leave, working mothers are forced to take an extended period of leave. Often their careers and earning potentials do not recover. The median gender pay by gross hourly earnings in the UK is 5.3% for workers in their 20s; 12% for those in their 30s; and to 27% for those in their 40s[8].
Conclusion
It remains important that women have a right to protection from discrimination because of the effects of pregnancy, as enshrined in s.18 of the 2010 Act. In April 2016 research carried out by the EHRC found that 77% of pregnant women or new mothers experience some form of workplace discrimination[9]
However, paying enhanced maternity leave is not only failing to address discrimination against working mothers, but is instead reinforcing an environment in which this insidious discrimination festers.
If equality in the workplace can be achieved through equal sharing of family responsibilities, it is unlikely this will be achieved while the rate of pay for Shared Parental Leave is so low. As the Pregnant Workers Directive recognised over 20 years ago, a right to leave serves no purpose unless it is accompanied by payment at an adequate level.
In 2012/2013 the take up of Additional Paternity leave was around 1% of eligible fathers[10]. This is generally understood to be because fathers are often the breadwinners and families could not afford to live on the rate of APP rather than the father’s normal salary.
The government anticipates that only between 2 to 8 percent of fathers will use Shared Parental Leave because it continues to be paid at such a low statutory rate[11]. For comparison, in Sweden, Norway and Iceland, new parents are paid between 80% – 100% of their income during their period of leave. Between 85% - 90% of fathers use their leave[12].
Choice for parents will always be dependent on their financial circumstances and where maternity leave is enhanced and shared parental leave not, it might not make financial sense for a father to take up his right to leave. Enhanced pay for Shared Parental Leave is as important to achieve equal opportunities (and the aims of the Recast Equal Treatment Directive) as enhanced pay for maternity leave. This would stop Shared Parental Leave being a second class option and give families real choice about who works and who cares.
[1]Hofmann v Barmer Ersatzkasse (C-184/83) [1984] ECR 3047; [1986] 1 CMLR 242
[2] Directive 96/34/EC
[3] European Parliamentary Assembly Resolution 1274, 26 March 2002
[4] Council Directive 92/85/EEC
[5]http://europa.eu/rapid/press-release_IP-15-5287_en.htm
[6]http://ec.europa.eu/justice/gender-equality/rights/work-life-balance/index_en.htm
[7] See, in particular, Hofmann v Barmer Ersatzkasse (C-184/83) [1984] E.C.R. 3047; [1986] 1 C.M.L.R. 242 at [25]; Kiiski [2008] 1 C.M.L.R. 5 at [46]; and Betriu Montull [2014] 1 C.M.L.R. 35 at [50]).
[8]http://www.ft.com/cms/s/0/4204de1e-2d4f-11e4-8105-00144feabdc0.html#axzz3F5i0eE00
[9]https://www.equalityhumanrights.com/en/our-work/news/three-four-working-mothers-say-they%E2%80%99ve-experienced-pregnancy-and-maternity
[10]https://www.tuc.org.uk/news/just-one-172-fathers-taking-additional-paternity-leave
[11]https://www.tuc.org.uk/news/just-one-172-fathers-taking-additional-paternity-leave; SPL Regulations Explanatory Note
[12]https://www.ft.com/content/2c4e539c-9a0d-11e7-a652-cde3f882dd7b