Ali v Capita Customer Management Ltd (Rev 2)

The Court of Appeal considered whether paying men on shared parental leave less than birth mothers receive on statutory maternity leave constitutes unlawful discrimination on grounds of sex, under the Equality Act 2010 (EA), and related domestic and EU statutory schemes (including the Pregnant Workers Directive and the Shared Parental Leave regime). The court held that statutory maternity leave (including the period after the compulsory two weeks) serves purposes linked to pregnancy and childbirth (health and safety of the mother, recovery, breastfeeding and the protection of the special mother–child relationship) which distinguish it from shared parental leave. Accordingly a mother on maternity leave is not a valid comparator for a man claiming direct discrimination in relation to shared parental pay; section 13(6)(b) and Schedule 7 paragraph 2 of the EA exclude special treatment connected with pregnancy or childbirth from account in relevant comparisons. The court also held that a male claimant in the police service who sought to characterise his claim as indirect discrimination was in truth bringing an equal-terms claim under the EA sex equality clause (section 66), but that the sex-equality clause does not operate to import terms that afford special treatment to women in connection with pregnancy or childbirth. The tribunal’s findings that the employers’ parental pay provisions were lawful were therefore restored.

Background and parties: Two linked appeals examined whether differential pay for shared parental leave (paid at statutory shared parental pay) compared with higher or occupational maternity pay for birth mothers amounts to unlawful sex discrimination. The appellants were Mr Ali (employee of Capita) and Mr Hextall (police constable); Capita and the Chief Constable of Leicestershire Police were respondents. Working Families intervened. The appeals came from Employment Tribunal (ET) decisions, then to the Employment Appeal Tribunal (EAT) and thence to the Court of Appeal ([2018] UKEAT 161 and [2018] UKEAT 139 at first instance in the EAT).

Nature of the claims / relief sought:

• Mr Ali brought a claim of direct sex discrimination under EA section 13, contending that Capita’s practice of paying shared parental leave at the statutory rate but paying higher occupational maternity pay to birth mothers treated him less favourably.
• Mr Hextall originally pleaded direct discrimination, amended to claim indirect discrimination under EA section 19 (PCP pleaded: paying only statutory rate for shared parental leave). The Chief Constable cross-appealed that the claim should have been characterised as a claim under the sex equality clause (EA section 66).

Issues before the court: (i) whether a birth mother on maternity leave is an appropriate comparator for a man on shared parental leave for the purposes of direct discrimination (EA sections 13 and 23); (ii) the ambit and application of EA section 13(6)(b) and Schedule 7 paragraph 2 (exclusions relating to special treatment for pregnancy/childbirth); (iii) whether Mr Hextall’s claim was properly characterised as indirect discrimination or as an equal-terms claim under the sex equality clause; and (iv) whether any identified disadvantage could be justified.

Reasoning and key holdings:

• The court analysed the relevant statutory framework (PWD, ERA, SSCBA, Shared Parental Leave and Pay Regulations, and the EA) and ECJ jurisprudence (notably Hofmann and subsequent cases). It emphasised that the minimum period of maternity leave required by the PWD and domestic law serves purposes linked to pregnancy and childbirth (maternal health and safety, recovery, breastfeeding and protection of the mother–child relationship) and is not simply childcare leave.
• Accordingly the court rejected the submission that, beyond the compulsory two-week period, maternity leave is predominantly for childcare and that the mother on maternity leave is a valid comparator for a man on shared parental leave. Section 23 therefore produced a material difference of circumstances and section 13(6)(b) excluded account of special treatment in connection with pregnancy or childbirth.
• On the police claimant, the court concluded the ET and EAT were wrong to treat the claim as purely an indirect discrimination claim: the complaint was in substance an equal-terms claim under the sex equality clause (section 66). However, Schedule 7 paragraph 2 excludes the sex equality clause having effect in relation to terms affording special treatment to women in connection with pregnancy or childbirth, so that such an equal-terms claim cannot succeed. Section 70’s mutual exclusivity provisions further prevent the claimant converting what is, in substance, an equal-terms complaint into an indirect discrimination claim in relation to those terms.
• The court restored the ET’s dismissal of Hextall’s claims and dismissed Ali’s appeal.

Wider context: The court noted the policy objectives underlying shared parental leave but held these do not displace or qualify the special legal protection afforded to pregnant workers and those who have recently given birth under EU and domestic law; it observed that subjecting statutory maternity protection to indirect discrimination scrutiny would be inconsistent with EU jurisprudence and legislative intent.

The appeals were dismissed in substance. The court dismissed Mr Ali’s appeal (direct discrimination) because maternity leave, including the period after the compulsory two weeks, is special treatment connected with pregnancy/childbirth and a birth mother on maternity leave is not a valid comparator for a man on shared parental leave (sections 13, 23 and 13(6)(b) EA). The court held that Mr Hextall’s complaint was in substance an equal-terms claim under the sex equality clause (section 66 EA) and that Schedule 7 paragraph 2 and section 70 prevent that claim being converted into an indirect discrimination claim; accordingly the EAT’s order remitting the matter was set aside and the ET’s dismissal restored. The rationale was that EU law and domestic provisions identify maternity protection as special treatment linked to pregnancy and childbirth which is excluded from the comparisons relied upon by the claimants.

This is an appeal to the Court of Appeal from Employment Appeal Tribunal decisions (Mrs Justice Slade) dated 11 April 2018 and 3 May 2018 arising from Employment Tribunal findings (Employment Judges Rogerson and Camp with lay members). EAT decisions cited: [2018] UKEAT 161 and [2018] UKEAT 139. The Court of Appeal delivered its judgment on 24 May 2019 ([2019] EWCA Civ 900).