Failure to pay enhanced shared parental pay may amount to indirect sex discrimination

Shared parental leave allows eligible parents to share time off work after their child is born or placed for adoption.

Eligible parents can take up to 50 weeks of leave and 37 weeks of pay in the year, following the birth or adoption of their child. The minimum rate of shared parental pay is set by the Government and is currently £139.58 a week or 90% of an employee’s average weekly earnings, whichever is lower.

The Government has issued guidance which provides that it is ‘entirely at the discretion of employers whether they wish to offer‘ enhanced shared parental pay.

An employment tribunal (ET) in Glasgow has recently held that an employer’s failure to pay enhanced shared parental pay, where it already paid enhanced maternity pay, amounted to indirect sex discrimination[1].

The law

Indirect discrimination occurs when an employer imposes a provision, criterion or practice (PCP) that has a disproportionate adverse impact on one group, and the imposition of the PCP cannot be justified. The concept of a PCP is broad and covers informal and formal working practices.

Background

Mr Snell and his wife were both employees of Network Rail. Mr Snell’s wife requested 27 weeks’ maternity leave following the birth of their child, whilst Mr Snell requested 12 weeks’ shared parental leave. Under the employer’s policy at the time, Mr Snell was only entitled to the statutory rate of shared parental pay, whilst his wife was entitled to 26 weeks’ full pay under the enhanced maternity policy.

Mr Snell raised a grievance on the grounds that the employer’s policy constituted sex discrimination. The grievance was not upheld on the basis that the employer had complied with its legal obligations in paying Mr Snell statutory shared parental pay. The grievance appeal was also rejected.

The decision

Mr Snell subsequently brought a claim in the employment tribunal alleging sex discrimination and, in the course of proceedings, the employer admitted its policy was indirectly discriminatory. Employment Judge Frances Eccles stated that the employer’s policy ‘…put the claimant at a particular disadvantage as a man when compared with women during periods of shared parental leave.’

Mr Snell was awarded £28,321.03 in compensation by the tribunal and Network Rail has stated in a press release that it has since reduced its female employee’s maternity leave entitlement to statutory payment only ‘to ensure fairness’.

Conclusion

Although tribunal decisions are not binding on other employment tribunals, if the finding of discrimination is upheld in a subsequent Employment Appeal Tribunal, the approach taken in this case will have ramifications for those employers that do not provide enhanced benefits to parents taking shared parental leave. A policy that results in a disparity between enhanced maternity pay received by female employees and the shared parental leave pay received by male employees could amount to indirect sex discrimination.

An employer with disparities in their policies may have an objective justification for that disparity if that policy is a proportionate means of achieving a legitimate aim, for example to promote the recruitment, retention and development of women within a male-dominated workforce[2].

It is unlikely that an extra cost to the employer of correcting any disparity will be held to be an objective justification.

For more information or guidance, please contact:

Sejal Raja
Partner and Head of Employment
T. 020 7227 7410
E. sejal.raja@rlb-law.com

[1] Snell v Network Rail ETS/4100178/2016
[2] Shuter v Ford Motor Company Ltd ET/3203504/130


Disclaimer

This briefing is for guidance purposes only. RadcliffesLeBrasseur accepts no responsibility or liability whatsoever for any action taken or not taken in relation to this note and recommends that appropriate legal advice be taken having regard to a client's own particular circumstances.

Briefing tags ,