The Government has now published its technical guidance on shared parental leave and pay. The new rules are expected to come into force on 1 December 2014 and will affect parents of babies expected to be born, or placed for adoption from 5 April 2015.
A recent tribunal decision of Shuter v Ford Motor Co considered whether a male employee taking additional paternity leave suffered sex discrimination because his employer, the Ford Motor Co. did not offer enhanced paternity pay while offering female employees enhanced maternity pay. The case rehearses some of the discrimination arguments which a disgruntled father might raise if shared parental pay is not enhanced. The claimant lost his case because, although the tribunal found that the failure to enhance additional paternity pay in line with the very generous enhanced maternity scheme, was indirectly sex discriminatory, the policy was justified because Ford had a legitimate aim in seeking to attract and retain women in view of its predominantly male workforce. Click here for our case summary.
The government guidance touches on this question of "occupational schemes" stating that:
- employers can continue to offer enhanced pay to women taking maternity leave;
- it will be entirely at the discretion of the employer as to whether they decide to offer enhanced pay to employees taking shared parental leave;
- but it will be sex discriminatory if a man taking shared parental leave is not offered the same enhanced pay as a woman taking shared parental leave.
Employers are uncertain as to whether to enhance shared parental pay to match enhanced maternity pay, mainly because of the high potential costs of doing so. However, the extra cost has to be weighed against the potential employee relations benefits of doing so, and the discrimination risk if you do not. So does the recent case of Shuter v Ford Motor Co, together with the government's guidance, mean that employers do not have to pay enhanced shared parental pay if they already pay enhanced maternity pay? We do not believe it is that clear cut, but read our conclusions here for more detail.