25 November, 2021 Open access
25 November, 2021 Open access
The Motherhood Plan & Anor, R. (On the Application of) v Her Majesty's Treasury  EWCA Civ 1703
The Self-Employment Income Support Scheme (SEISS) was introduced alongside a series of other measures at the start of the Covid-19 pandemic. On 26 March 2020 it was announced that, under the scheme, the government would pay self-employed people a taxable grant worth 80 per cent of their average trading profits (ATP) over the previous three years, up to £2,500 per month, for three months or longer if necessary. On 30 April 2020, the Chancellor signed a direction under the Coronavirus Act 2020 giving effect to the SEISS.
The second claimant, Kerry Chamberlain, worked as a self-employed energy analyst. In the tax year 2017/2018, she took a 39-week period of maternity leave after the birth of her second child, and in the following tax year she took a further 39-week period of leave after the birth of her third child. As a result of her periods away from work her trading profits were reduced, and when she submitted a claim to the SEISS she received a lesser amount than she would have done had she not taken maternity leave.
Supported by the first claimant - a registered charity known as 'Pregnant then Screwed' which aims to end discrimination faced by pregnant women and mothers - Ms Chamberlain sought a declaration that the SEISS unlawfully discriminated against women who had taken a period of absence from work relating to pregnancy or maternity, contrary to Article 14 of the European Convention on Human Rights (the Convention) read with Article 1 of the First Protocol, asserting that the discrimination had taken the form of indirect discrimination and also Thlimmenos discrimination (discrimination that arises where the State fails to take measures to recognise that persons in significantly different situations ought to be treated differently).
With the High Court having dismissied the application for judicial review, the claimants appealed to the Court of Appeal on three grounds -
Whether the SEISS unlawfully discriminated against self-employed women who took a period of leave relating to maternity or pregnancy in any of the three relevant tax years, since the level of support granted to them under the scheme was not representative of their usual profits.
Lord Justice Underhill and Lord Justice Baker, with whom Lady Justice Davies agrees, dismiss the appeal finding that although the Scheme did indirectly discriminate against women who had taken maternity leave, the discrimination was justified given the exceptional circumstances of the Covid-19 pandemic.
Lord Justice Underhill and Lord Justice Baker take their starting point from Lord Reed in R (SC) v Secretary of State for Work and Pensions  UKSC 26 who said of indirect indiscrimination -
‘It can arise in a situation where a general measure or policy has disproportionately prejudicial effects on a particular group. It is described as 'indirect' discrimination because the measure or policy is based on an apparently neutral ground, which in practice causes a disproportionately prejudicial effect on a group characterised by a salient attribute or status.’
Moving on to consider a range of case law - including Barry v Midland Bank plc  UKHL 38 and R (Adiatu) v HM Treasury  EWHC 1554 (Admin) - Lord Justice Underhill and Lord Justice Baker find that the ATP measure used in the SEISS did constitute prima facie indirect discrimination -
‘The purpose of SEISS is to compensate self-employed persons for their loss of profits in the current year as a result of the pandemic. The ATP measure works by using past profits to represent, in however rough-and-ready a manner, their likely hypothetical no-Covid profits. If its use in the case of new mothers produces results which are disproportionately unrepresentative of those profits, as compared with others, that necessarily puts them at a particular disadvantage.' (paragraph 87)
As a result, it was not necessary for them to consider Thlimmenos discrimination.
Quoting Lord Reed again as a starting point - in R (SG) v Secretary of State for Work and Pensions)  UKSC 16 - Lord Justice Underhill and Lord Justice Baker highlight that the proper approach to justification in cases of indirect indiscrimination is -
'Whether that difference in treatment has an objective and reasonable justification will depend on whether the rule which results in the difference in treatment has a legitimate aim and is a proportionate means of realising that aim.'
The claimants' main complaint was not the use of the ATP measure as such but the failure to introduce a special modification to cater for the case of recent mothers whose profits in the measurement period will have been unrepresentative of their likely 'hypothetical no Covid earnings' in 2020. However, Lord Justice Underhill and Lord Justice Baker point to the 'extreme if not unique circumstances' in which the SEISS was devised -
'It is evident that it was not until the middle of March 2020 that the government appreciated the seriousness of the threat to lives and to the economy posed by Covid-19. By that time, the die was cast and the need for urgent action obvious. Time was of the essence. The scheme therefore had to be devised and constructed with the utmost speed. To obtain additional information in the case of recent mothers would have involved a complex exercise which in turn would have significantly delayed the implementation of the scheme. Furthermore, any further information would have had to be based on some form of self-reporting by the individual taxpayer of impact of maternity on their earnings in the measurement period: whatever method were adopted, its reliability and accuracy of which would be hard to verify. Perhaps, given time, it would have been possible to devise a modification that allowed recent mothers to submit verifiable information that could form the basis for a special assessment of their likely lost earnings. But in our judgment it would plainly not have been possible to do so in the limited time available without compromising the essential requirements of speed, simplicity and verifiability.' (paragraph 130)
Taking that into account, they conclude -
'In short, given the cardinal features required of the scheme - and above all speed and simplicity - the first respondent was in our view justified in introducing the scheme in a form which did not contain special provision for the position of recent mothers.' (paragraph 132)
24 November, 2021