Why care?

Currently, the father (or female partner of a mother) may take up to six months’ additional paternity leave (APL) if the mother returns to work before the end of her maternity leave period. APL can be taken at any time between the period which begins 20 weeks after the date on which the child is born and ends 12 months after that date. The father’s entitlement to leave and pay depends on the mother returning to work with some maternity leave outstanding. Additional paternity pay (APP) is paid at the flat rate during the mother's unclaimed SMP period (currently at the statutory basic rate of £138.18 per week) up to a maximum of 19 weeks. 

Employers have been grappling with the question raised in this case for some time: namely whether, if a woman is provided with enhanced, contractual maternity pay, then a man on APL should also benefit from the same right. This is not required under the legislation and the Government’s view is that there was no such obligation.

This issue also has relevance to the upcoming shared parental leave scheme which will replace APL and APP. Regulations which come into force on 1 December 2014 will permit shared parental leave and statutory shared parental pay to be available for eligible employees whose baby is due on or after 5 April 2015 or who have a child placed with them for adoption on or after that date.

The case

Since 2001 Ford Motor Company Ltd (Ford) has given women on maternity leave 100% of their basic pay for the full duration of statutory leave. One of the reasons for doing so was to enhance Ford’s ability to recruit and retain female employees and to assist in meeting the company’s target of a 25% female workforce. When the APL Regulations were introduced, Ford considered improving paternity benefits, but decided to just pay APL at the statutory rate.

Mr Shuter is employed by Ford. His wife is employed by Essex County Council and returned to work following maternity leave so Mr Shuter took APL from Ford. He was paid APP at the statutory rate in accordance with Ford's policy. He brought an employment tribunal claim arguing that Ford's failure to pay enhanced APP equivalent to its enhanced maternity pay was direct and indirect sex discrimination. He sought to compare his treatment with that of a mother on maternity leave and argued his loss was approximately £18,000 as a result.

The employment tribunal rejected his claims. It held that Ford did not directly discriminate on the ground of sex by paying only the statutory rate of pay to a male employee on additional paternity leave. Mr Shuter relied on a comparison with a woman on maternity leave who was paid full pay throughout, including during the period in which APL would be available (i.e. from 20 weeks after the birth). However the proposed comparator would have been pregnant and given birth and in accordance with the Equality Act 2010 no account should be taken of special treatment afforded to women in connection with pregnancy or childbirth. The tribunal accepted Ford’s argument that the proper comparator was a female applicant for APL (such as a female spouse or civil partner) who would have been treated in the same way as Mr Shuter. The tribunal also rejected his proposition that the introduction of the APL regime meant that only the first 20 weeks of maternity leave were aimed at protecting the health and safety of the mother after childbirth and that the later period was aimed at facilitating childcare, which can be undertaken by either parent. The tribunal held that the APL regulations were not intended to encroach on the 52 weeks maternity leave which remains and it is up to the mother whether or not she ends it early permitting the father to take APL.

As far as Mr Shuter's indirect sex discrimination claim was concerned, the tribunal accepted that Ford's maternity policy of paying full pay to women on maternity leave beyond 20 weeks after the birth of the child (its provision, criterion or practice (PCP)) placed men, and Mr Shuter in particular, at a disadvantage and was therefore potentially indirectly discriminatory. It accepted that "common sense tells us that the largest group eligible for APL are fathers" and that they only received statutory pay.

However it accepted that Ford could objectively justify its PCP as being a proportionate means of achieving a legitimate aim. Ford explained that the reason for its generous maternity pay policy enhanced the company’s objective of recruiting, retaining and developing female employees in a male-dominated workforce. This was a legitimate aim.  If APL had matched the maternity pay on offer, take up by men would have been much higher (to date only five men had taken APL in a workforce of over 10,000). This would have been costly and would potentially have meant that they would have had to reduce their enhanced maternity pay, so undermining their objective as regards their female workforce. They also took into account that APL was temporary pending the introduction of shared parental leave and that the Government’s advice was that employers did not have to make APL benefits comparable to maternity benefits.

The tribunal also decided that the aim was proportionate as although Ford had not reached its target of a 25% female workforce, there had been an overall increase in the number of women, and in women in professional and senior management grades. A substantial number of women had returned to work for at least a year following maternity leave. The tribunal agreed that Ford's enhanced maternity pay policy had been effective at promoting the recruitment and retention of women.

What to take away

This decision is not binding on any future employment tribunal but has been an interesting addition to the current debate on whether enhanced maternity pay should be mirrored in the provision of paternity pay or, in the future, of shared parental pay. This case is clear that APL is separate from maternity leave and is dependent on the mother ending that leave prior to a partner taking APL. However, whether a differential in pay could be justified for a claim of indirect discrimination would depend on the facts. In this case the reason for the difference in treatment was because the employer wanted to retain and develop female employees in a male dominated workforce. This would not necessarily be a valid argument for other businesses with a differently constituted workforce.