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Question: |
Do women on maternity
leave have the right to accrue a contractual bonus? |
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Answer: |
Should employers give women on maternity leave bonuses, or
should they be reduced pro rata? This question came up in Hoyland v Asda
Stores Ltd [2005] in the EAT where annual bonuses were reduced pro-rata
during maternity leave. The Scottish Court of Session held that it was lawful to
reduce the annual bonus pro rata as a result of maternity leave. Ms Hoyland
had to be paid the bonus in respect of the period actually at work AND the
two weeks of compulsory maternity leave. Beyond that, Asda was free to reduce
the bonus to reflect the period away from work on maternity leave. (The scheme in question actually provided
for pro-rata reduction to take account of part-time employment and absences
of eight consecutive weeks or more and payments were also reduced if the
employee had been disciplined during the year or had less than 12 months
continuous service.) The decision is bad news for pregnant women; apparently
bonuses and babies do not mix. Some employers may take the view though that
it’s better to pay full bonuses regardless to encourage loyalty and to reduce
staff turnover costs. The Scottish Court of Session has held that a pro-rata
reduction of an annual bonus to take account of ordinary maternity leave is
neither unlawful sex discrimination nor pregnancy-related detriment - the
scheme in question actually provided for pro-rata reduction to take account
of part-time employment and absences of eight consecutive weeks or more and
payments were also reduced if the employee had been disciplined during the
year or had less than 12 months continuous service ( Hoyland v Asda Stores
Ltd CS 2006 , Court of Session on 5th April 2006, Case 2006 CS IH 21).
However the Court of Session also confirmed that no reduction is allowed is
respect of the two week period of compulsory maternity leave. See also our page on the Equality Act 2010 Last Reviewed: July 2010 |
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Employment
Solicitor Reculver Solicitors Tel
0207 324 6271 Regulated
by the Solicitors Regulation Authority ©
Reculver Solicitors. 2005- |
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