UK: Shared parental leave - new guidance, and ET ruling relevant to pay enhancement

BIS has published technical guidance on the new shared parental leave (SPL) regime applicable to babies due from 5 April 2015, available here.  A short guide is also available from Acas, here.

A key issue for employers will be the extent to which they can or should offer enhanced pay during periods of SPL. The Government has taken the view that employers can choose to enhance maternity leave benefits but not extend the same benefits to SPL, on the basis that there cannot be any (direct) sex discrimination as both female and male parents on SPL are treated alike. However, the legal position is not clear cut and in any case there remains the potential for other claims such as indirect discrimination or unlawful detriment. 

An employment tribunal recently heard a claim that an employer's enhancement of pay during maternity leave, but not additional paternity leave, was discriminatory. The tribunal concluded that the correct comparator for direct sex discrimination purposes was a woman taking additional paternity leave (as the partner of the mother), and not a mother taking maternity leave, and therefore that claim was rejected. The employer conceded that the policy disadvantaged men disproportionately and was therefore indirectly discriminatory, but the tribunal ruled that it was objectively justified in that case by the need to recruit and retain women in a male-dominated workforce. (Shuter v Ford Motor Company Ltd).

Employers intending not to extend maternity pay enhancements to those on SPL will need to carefully consider the legal risks and whether their policy can be justified, bearing in mind that cost alone does not provide sufficient justification.  Please do contact us if you require any assistance reviewing your policies or pay strategy. A copy of the HSF briefing on the SPL regime is available on request.