Employer not required to enhance paternity pay to mirror enhanced maternity pay scheme

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Summary: An Employment Tribunal has decided that an employer was entitled to pay enhanced maternity pay to women on maternity leave whilst only paying statutory paternity pay to men on additional paternity leave. The case highlights issues for employers to consider in relation to the Shared Parental Leave regime, which comes into effect from April 2015.

You should read this if you deal with family leave rights in the workplace

The 20-second summary

An Employment Tribunal has decided that an employer was entitled to pay enhanced maternity pay to women on maternity leave whilst only paying statutory paternity pay to men on additional paternity leave. The case, Shuter v Ford Motor Company, highlights issues for employers to consider in relation to the Shared Parental Leave regime, which comes into effect from April 2015.

Employer pays enhanced maternity pay but not enhanced additional paternity pay

The law currently provides that a father or spouse/partner of someone on maternity leave can take up to six months’ additional paternity leave (“APL”), subject to certain qualifying requirements. An individual taking APL may be entitled to additional statutory paternity pay.

Under Ford’s maternity policy, women on maternity leave were paid enhanced maternity pay of up to 52 weeks’ full salary. By contrast, Ford did not give enhanced pay to those taking APL. A Ford employee, Mr Shuter, argued this difference in treatment was direct and indirect sex discrimination.

Tribunal says no requirement to pay enhanced additional paternity pay

The Tribunal said that there was no direct sex discrimination. Mr Shuter couldn't compare himself to someone taking maternity leave, because maternity leave and APL were different rights with different purposes. The correct comparator was a woman taking APL, who would have been treated no differently to Mr Shuter in terms of pay during APL.

Mr Shuter's indirect discrimination claim also failed because Ford objectively justified having such a generous enhanced maternity pay policy. The legitimate aim of the enhanced maternity pay policy was to recruit and retain more women in Ford’s predominantly male workforce, and the Tribunal said that the policy was proportionate in the circumstances.

Implications for employers

As we approach the introduction of the new Shared Parental Leave regime in April 2015, one of the issues currently vexing employers is the extent to which they might face similar claims if they decide not to enhance shared parental pay. Employers may take some comfort from the Tribunal's decision in this case, although it is important to bear in mind that there are material differences between APL and Shared Parental Leave, and this is only a first instance decision which is not binding on other tribunals.

The Tribunal’s findings on indirect discrimination turned on the specific facts of this case. Ford’s policy was designed to tackle the very significant under-representation of women in its workforce. The Tribunal also took into account the fact that the difference in treatment arises because men cannot qualify for maternity leave, and legislation specifically provides that treating women more favourably in connection with pregnancy and childbirth can be lawful.

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