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Equality Act - Pregnancy / Maternity Discrimination

(84 Posts)
OneTwoOrThree Thu 04-Oct-12 15:05:38

Looking for some help, please....

I believe that I have been discriminated against by my mortgage provider on grounds of pregnancy / maternity. I am in the midst of their complaints process and will escalate to the Financial Ombudsman if necessary.

In short, the bank are refusing to lend me additional funds purely because my 'maternity pay' does not meet their lending criteria however if I was receiving my normal salary they would be happy to lend. Please shout if you disagree that this is maternity discrimination.

Anyway, the reason for my post is that I'm not sure what to do next. I could get the funds at a similar rate from another bank, so why fight my current lender? What do I gain? (Apart from, perhaps, influencing a change in policy so others don't suffer the same discrimination).

olgaga Wed 10-Oct-12 08:49:20

The Ombudsman's decision post-dates the Act.

Pregnancy/maternity was a protected characteristic (S.3A of the SDA 1975) prior to the EquA.

You would still have to show that the lender has, at the time of the application, discriminated on the grounds of the protected characteristic (pregnancy and maternity) and not income. That is the only relevant issue.

It is obviously important that lenders do not make assumptions about people as a result of any protected characteristic. The correct approach is to look at affordability. Which is what the lender has done.

CelineMcBean Tue 09-Oct-12 23:14:36

I think the fact that ruling came in before the Equality Act and pregnancy/maternity became a specific protected characteristic is a very important point.

I can see how a sex discrimination argument would be harder to fight but the new statutory legislation potentially gives the maternity discrimination legs.

olgaga Tue 09-Oct-12 22:45:38

I am satisfied that X does not reject applications solely because an applicant is on maternity leave. Rather, it assesses whether the requested borrowing is affordable based on the income that is verifiable.

Yes - I thought that was the obvious response. As I tried to explain, it's not the maternity pay in itself. It's the affordability. A woman on maternity leave (or a couple) may still have a sufficiently high income to meet the affordability criterion.

Interesting study you participated in and linked to Belle. The article I linked to in my post upthread is a later one:

There's no easy answer to this - the Affordability Test is mandatory, and non-discriminatory - applying, as it does, to everyone.

YoullLaughAboutItOneDay Tue 09-Oct-12 20:55:34

That's interesting.

It sounds like the bank was arguing that it wasn't so much about maternity leave or thinking you might not return to work. It was effectively about the fact that you did not meet the earnings threshold because they wouldn't count your pay unless it was going to start coming in again imminently.

Rather undermined by not asking how much your maternity pay was though hmm.

But if that defence has worked with the ombudsman, it is something for the OP to bear in mind.

BelleCurve Tue 09-Oct-12 20:48:00

I've found the Ombudsman final wording to my complaint

"X says that where an applicant is on maternity leave, it will only take into account their employment income if it receives proof that they will return to work within 3 months. I am satisfied that X does not reject applications solely because an applicant is on maternity leave. Rather, it assesses whether the requested borrowing is affordable based on the income that is verifiable. I think that this is a reasonable approach in the circumstances and that X has not treated Ms Curve unfairly."

I am not sure why/how this 3 month thing came about, being as your return to employment rights are exactly the same throughout and if you choose not to return the standard notification period is IIRC 8 weeks.

They don't make any comparison to alternative situations, so I think just having a "maternity leave" policy is discriminatory in this circumstance.

Also, and most tellingly - they never even asked what my income was whilst I was on maternity leave. For all they know I could (I wasn't) have been on 6 months full pay.

Plus here is some of the media coverage from the research report that I contributed to. Unfortunately, that is not me with the bump!

sorry daily mail

olgaga Mon 08-Oct-12 23:15:58

OneTwoorThree Do please let us know how you get on making your case, and how it is to be argued - and of course I am eager to hear the outcome!

Best of luck to you with all that's in store.

YoullLaughAboutItOneDay Mon 08-Oct-12 22:05:57

If you want to go for it, go for it. I do think it is horribly unfair, and admire your guts.

However, just bear in mind the legal test. It's about whether you were treated unfavourably due to your pregnancy. It's not about comparators in maternity discrimination. How you are treated compared to other women who might go on to get pregnant isn't that (legally) relevant. I can see how it irks, but don't get sidelined into that being your main argument or it will be pretty easy for them to rebut you.

OneTwoOrThree Mon 08-Oct-12 21:58:45

Thanks Celine.... Really appreciate your input and you have reassured me that I may well have a case here.

I think the aspect that really irks me is the 'timing' issue. Any (female) mortgage applicant could go on to get pregnant / take maternity leave, but would not be discriminated against for this potential future change...

Furthermore, I am frustrated by the fact that I have offered to demonstrate to the 'bad bank' that I have planned for my reduced income (by having cash savings that are greater than the reduction in my income for the maximum duration of my maternity leave) and can therefore afford the proposed mortgage repayments.

In addition to this, I have overpaid my monthly repayments by circa 60% each month since the outset of my mortgage. I have subsequently 'cashed this in' to pay for my extension, but having made these regular payments demonstrates my 'repayment ability' - ie the bit the bank should be concerned about?

I'd love to achieve something during my maternity leave (other than a wonderfully happy, balanced etc etc DC), so am 'well up' for this fight!. I suspect the chances of this 'battle' being over before I return to work are very slim though...

CelineMcBean Mon 08-Oct-12 21:26:39

Op, I did have a quick look at the Act, particularly the service sections, exceptions and schedules and I haven't revised my opinion.

I don't have time now to pull out all the relevant points (you seem to have most of them any way) and Youlllaugh has done a brillisnt job, but suffice to say I do not need to make any apologies wink

OneTwoOrThree Mon 08-Oct-12 20:59:51

Good debate, and one that I guess we won't resolve until someone takes this through the courts (and that won't be me - unless I find a 'fee free' lawyer wanting to take the case on to make a name for themselves grin).

My plan (as I see it) is to pursue my 'follow-up' complaint with the offending bank, and in the meantime remortgage to one of their competitors <grin>

If my current bank concede they are in the wrong, then great.... If not, I intend to take this further - more for the sense of accomplishment and benefit of other people who may find themselves in a similar situation in the future..

I will need to consider what route I take though - either (or both of) Financial Ombudsman or the media route. Whilst FOS feels like the 'right' way to proceed, I am disheartened by Belle's treatment and FOS's view that they don't have to consider what is legal, only what is fair hmm. I also realise that this could take months or years to get through FOS, whilst a media driven approach could be quicker. My final consideration (and one I've not confessed to yet!) is that I work for a bank - not my current lender nor my proposed lender, but I do want to consider the impact on my professional reputation of 'attacking' a bank via the media...

If anyone is interested in the outcome, then I'll post here to keep you updated.

Thanks again smile

olgaga Sat 06-Oct-12 19:47:40

I do understand that it is direct discrimination to treat a woman unfavourably because of her pregnancy.

I wasn't actually arguing that there was such a thing as "indirect pregnancy discrimination", or even that OP would have an arguable case of indirect sex discrimination. I was just trying to explain my view that you could, at a push, describe OP's case as indirect sex discrimination (but with objective justification) so that wouldn't in any case be a runner. I am sorry if I was unclear about that.

But I really do think it would be stretching it to argue that it was unfavourable treatment because of her pregnancy. Much as I would like to think otherwise.

Anyway, interesting debate - if a little fraught at the end! No offence meant to anyone.

YoullLaughAboutItOneDay Sat 06-Oct-12 16:45:48

I fully accept that others might be knowledgeable, including much more knowledgeable than me. For all I know world wide experts on these issues are posting on this thread.

What annoyed me is that you did seem to presume to know what I think. In a block of text where we were speaking directly to one another you said "believe me, it's a lot more difficult to meet the threshold than you think". That is presuming to know what I think. If you intended the 'you' in the general 'than one thinks' sense, then I apologise for the misunderstanding.

You did also post a whole paragraph arguing that the OPs situation was, on the face of it, clearly indirect discrimination and discussing objective justification. It's an easy mistake to make and I had to go back to the Act to double check, but of course none of that applies and you didn't acknowledge that mistake in your next post.

olgaga Sat 06-Oct-12 16:28:24

Yes well maybe I do know a lot about this. Is it so strange, that someone else might be knowledgeable about your particular line of work?

I've never presumed to know what you think - I just know what I think, and that's what I've posted. You might not agree with my opinion, but it's as valid and knowledgeable as yours.

I'm sorry you're so annoyed, I thought it was quite a worthwhile debate, and OP has clearly found it interesting. I am also grateful to BelleCurve for relating her experience in particular, which made interesting (if depressing) reading.

YoullLaughAboutItOneDay Sat 06-Oct-12 16:08:32

I think I will leave it there Olgaga. You clearly are not open to alternative points of view and discussion. You know everything - including apparently knowing what I think about the threshold for discrimination and being right about it whilst I am wrong. I really can't argue with that.

YoullLaughAboutItOneDay Sat 06-Oct-12 16:05:05

Olgaga, I think we will have to agree to disagree, yes. I agree that you have to show the 'because of' bit, and as I explained two posts ago, Celine has given one way you might argue that.

olgaga Sat 06-Oct-12 16:03:43

I would add that employers have learnt over the years to be far more subtle about discrimination. I have instructed employment lawyers and worked with Counsel on many different discrimination cases. Some of the people I have worked with now sit as Employment Judges.

olgaga Sat 06-Oct-12 16:00:01

what do you mean by 'believe me, it's a lot more difficult to meet the threshold than you think'?

Exactly what I said!

olgaga Sat 06-Oct-12 15:59:06

Yes, but you first have to show that someone is being treated unfavourably because of that protected characteristic. That is simply not clear in this case. The given reason is the inability to meet the Affordability Criteria. The OP says she doesn't meet that because of her pregnancy, but the reason for her inability to meet the affodability criteria isn't an issue for the bank.

The issue for the bank is the affordability, not the reason for the lack of affordability.

Anyway, I can see I'm wasting my time here!

YoullLaughAboutItOneDay Sat 06-Oct-12 15:48:55

Olgaga- what do you mean by 'believe me, it's a lot more difficult to meet the threshold than you think'? Firstly, my very first post on this thread I told the OP I thought she might struggle. Secondly, I have been an employment lawyer for more than a decade, so I think I have a fair idea how difficult it is.

YoullLaughAboutItOneDay Sat 06-Oct-12 15:46:09

Indirect discrimination does not apply to pregnancy/maternity. As a legal head of claim, indirect discrimination applies to:

gender reassignment;
marriage and civil partnership;
religion or belief;
sexual orientation.

The idea of objective justification is part of the test for indirect discrimination, so that bit isn't relevant here either.

The test for pregnancy/maternity is whether A is treated 'unfavourably' 'because' of pregnancy/childbirth.

So with pregnancy it isn't about whether discrimination is direct or indirect. The test is whether the treatment is 'because of' the status. We have both pointed out that you could argue it is not because of the pregnancy - if the court accepted that is was simply 'because of' the dip in current income. Equally Celine has argued how you could say it was because of the pregnancy - because the only reason for that dip is maternity, so the two are inextricably linked.

olgaga Sat 06-Oct-12 15:42:35

I just read your last post, You'llLaugh. It seems to relate more to employment rights, and even then it's only right if it is a clear case of someone being discriminated against because they are pregnant.

For example: "You're pregnant? Congratulations!"

Following day:

"I'm really sorry but I've decided to make your post redundant because I woke up this morning to find that your work has dried up in the last 24 hours".


"So pleased you are enjoying motherhood, but unfortunately while you were on maternity leave we decided your job no longer exists" (while continuing to employ the "maternity temp").

A tribunal would be inclined to decide both scenarios were "Pregnancy Dismissal" and therefore automatically unfair. Of course, it's usually a lot more subtle than that - and believe me, it's a lot more difficult to meet the threshold than you think.

In relation to the provision of services, I can't think of a similar scenario.

olgaga Sat 06-Oct-12 15:33:21


It's not so much that you can't extend the argument in the way you describe, it's that there is a strong and obvious defence, so no one would bother.

The point I was making was that it would be indeed be laughable to extend the argument in that way - and you have picked up on the fact that there would be a "strong and obvious defence" - in other words, the bank can argue there is an "objective justification" of their decision.

Where I do agree is not so much about the fact that we are dealing with a couple (which I don't think is relevant) as the point I made above - that the court may accept that the treatment was not because of maternity/pregnancy, but because of dipping below the threshold.

Then we are in agreement about the key issue. OP is not being discriminated against because she is pregnant. She is also not being discriminated against because of any assumption that as a result of her pregnancy/maternity she may not be able to meet the affordability criteria. That would be direct discrimination.

She is being discriminated against because she does not meet the affordability criteria. The reason is her reduced income, as a result of maternity leave. On the face of it, that is clearly indirect discrimination.

The definition of indirect discrimination is:

The use of an apparently neutral practice, provision or criterion which puts people with a particular protected characteristic at a disadvantage compared with others who do not share that characteristic, and applying the practice, provision or criterion cannot be ^objectively justified.

The objective justification here is the affordability criteria. This is something the bank has no choice but to apply, and it is applied to all applicants equally at the time of the application.

The discrimination comes from using maternity pay, not salary.

They aren't looking at salary. They're looking at income and outgoings in relation to the affordability of the product you have applied for, at the time of your application - see above with regard to indirect discrimination.

BellCurve's experience is a perfect illustration of just how limited it is.

It is simplistic to argue that OP's drop in salary is a result of maternity pay, ergo she is being discriminated against because she is pregnant, and that is direct discrimination. But that's not the case, IMO. It is indirect discrimination, objectively justified.

The law reflects the society we live in, and sadly women still bear the brunt of the economic and social effects of pregnancy, maternity and raising a family.

Finally, I would just like to clear up any misunderstanding about my position here. I am as frustrated as anyone else by the limitations of the law.

YoullLaughAboutItOneDay Sat 06-Oct-12 14:42:07

OneTwo - Sorry if I confused you. My reference to indirect discrimination wouldn't apply to pregnancy discrimination. It is a very specific legal concept applying to sex discrimination claims in employment (and presumably in services provision too:

- the employer has a rule, which is on its face gender neutral;
- that rule disproportionately affects women; and
- the woman who is claiming was affected

(or vice versa if the claim is from a man). The classic example is part time working. An employer could say 'well, we just don't allow part time, that is gender neutral', but it disproportionately affects women because they shoulder the majority of childcare. So there is a potential claim, unless the employer can 'justify' their decision as a defence. An example might be "We can't allow part time working because we are an oil rig and we can't keep flying you back to the mainland" grin.

I was responding to Olgaga's argument that you could extend what I was saying in previous posts to mean that no one could apply affordabilty criteria to women because they statistically earn less, and that is mainly because of children/pregnancy/childcare.

In pregnancy, indirect discrimination isn't relevant. Legally, either treatment is related to the fact you are pregnant, or it isn't.

BelleCurve Sat 06-Oct-12 11:15:24

Here is the document Public Sector Equality Duty

I raised this also with the EHRC and they said unless it could be proved that the Ombudsman was consistently discriminatory in their decisions there was nothing that could be done to enforce this. As long as their documents were available in large print it would be considered that they had complied. The only alternative would be a judicial review.

BelleCurve Sat 06-Oct-12 11:11:11

The original rejection was in 2009, but it took 2.5 years to get a final answer from the Ombudsman. I considered (and threatened) actions against the Ombudsman under the Equality Act 2010 as there is an extra obligation on public bodies not to discriminate (I forget the actual wording).

My understanding however is that the Equality Act just consolidates previous discrimination legislation rather than tightens it up (not a lawyer, finance here too - but I have read quite a lot about this!)

In my approach directly with the bank I followed the process of the Sex Discrimination Act - requesting them to complete a questionnaire (which they refused to do) but the end result of the process as directed by the EHRC was really only an employment tribunal.

For the specifics of my case, they really focused on the "current income" piece even though I had over a year's gross income in savings with the same bank, had a letter confirming my employment (I got a raise whilst on maternity leave!) and was the main wage-earner, sole mortgage holder 6 years prior to that point. In addition the mortgage request was 2.5 times my sole income, and 60% LTV - so well within any standard lending criteria.

However, they would grant a mortgage to my H who had no credit track record -with no thought about how having children would impact his future earning ability.

I emphasised this in my correspondence, that all parents have equal rights to request flexible working conditions. Also as there is a legal obligation to guarantee the same job/equivalent job on return from maternity I was in a better position than many at the time.

In the comparison to insurance premiums etc where statistical data can be used to generate a premium, this is specifically excluded from bank lending where individual circumstances must be assessed. If you continue along the lines that statistically "women are more likely to work part-time, so we won't lend them money" you can extrapolate to "women are more likely to get pregnant, so we won't lend them money". Or basically we just won't lend money to women.

I know of friends who have been asked when applying for a mortgage if they plan to get pregnant.

Also, and quite bizarrely when I confronted the Ombudsman with the sex discrimination angle they told me "we don't have to consider what is legal, just what is fair" hmm

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