A brief overview for the curious, the "Alabaster" ruling is a piece of case law which basically means that if a woman receives (or would have received had she been at work) a pay rise after her statutory maternity pay was calculated but before the end of her maternity pay period, her SMP must be recalculated based on the new pay, and the recalculated amount must be backdated.
Flowery, I know that is the case, but do you know the background that led to that conclusion?
If a woman was on Maternity leave from May to May, and is due a pay rise each April, it doesn't seem very fair that they have the effect of the pay rise a year earlier than they otherwise would have done?
It's about Equal Pay lougle, but I'm not sure about the rational behind the conclusion that pay rises must be backdated for the entire period even if the rise was effective from, say, the day before SMP ended.
Am looking for guidance that explains this point...!
The ECJ took the view that it is discriminatory if a woman receives no benefit from a pay rise received after the start of the reference period and before the end of maternity leave. They said, "To deny such an increase to a woman on maternity leave would discriminate against her since, had she not been pregnant, she would have received the pay rise."
Personally I don't think the ECJ has thought this through properly (to be honest, I think that is true of quite a few of their judgements). In the situation outlined by Flowery it discriminates against anyone who isn't pregnant. Those who are not pregnant would receive one day's increase whilst the woman on maternity leave will receive 90% of six weeks increase (if she is on low pay, 90% of 39 weeks increase). In some circumstances a woman who doesn't take full maternity leave may end up receiving more for her time on maternity leave than those who remain working.
"Personally I don't think the ECJ has thought this through properly (to be honest, I think that is true of quite a few of their judgements)."
I can't find anything explaining the logic behind backdating the increases in this way, which suggest it is possibly something that perhaps the ECJ didn't quite think through, with the wording of the judgment resulting in this situation without that quite being the intention.
You see, I can completely understand a judgement that says:
"If a woman receives a pay rise after her average pay from the reference period has been calculated, that affects that average pay (i.e. the pay rise was deferred but back dated to a date within the reference period) then the average pay should be recalculated using the higher pay rate."
"If a woman is/was/would otherwise have been due a pay rise during the period of her maternity leave, then that pay rise should be applied to payments after the date of the pay rise."
So the Alabaster case was about a woman who had a pay rise between the 8 week averaging period, and the start of her maternity leave. She felt that as the average pay did not reflect her new salary prior to starting Maternity Leave, it should have been updated.
I still don't understand why they felt that it should have such a wide scope though
Could I ask if this would hold with enhanced terms? So if a company offers 9 months full salary as CMP, and there's a payrise in the period, should it be backdated? Or does the fact that the enhanced terms are better than Statutory trump the ruling?
I think the reasons are linked in part. to an early European Judgement. The Advocate General's opinion was that early judgment (Gillespie) raised a number of difficulties and should not be followed. The ECJ disagreed and went with the early judgment. The main reason is as PHR says is linked to the reference period. They say that women on maternity leave are in a special position (rather than being able to claim equality). So in effect they give more favorable treatment.
Flowery- This is similar to positive discrimination set out by Archibald v Fife.
Positive discrimination in favour of women I can understand although I'm not particularly in favour of it unless there is strong evidence that it is necessary. But a situation where a woman who takes maternity leave ends up being paid more than she would have had she stayed in work seems bonkers (and a waste of our taxes, given that employers recoup most of the cost of SMP from government). That is discriminating against women who don't get pregnant as well as discriminating against men.