Granny as nanny? What are the Government's proposals for paid leave for grandparents?

George Osborne has announced that the Government aims to extend shared parental leave to grandparents by 2018 (see here). The details are pending and consultation will take place in the first half of next year. This announcement came at the Conservative conference with the commitment of giving working grandparents paid leave to take care of grandchildren.

Shared parental leave came into force on 5 April 2015 (see our earlier blog post here), which entitles parents to share a maximum of 52 weeks’ leave and 39 weeks’ statutory pay. Parents are also entitled to statutory shared parental pay which is the lower of £139.58 (the “prescribed rate”) or 90% of the normal weekly earnings of the person claiming shared parental pay.

“Grandparental leave” will give parents and grandparents (who may currently end their own employment to assist with childcare) an extra option as to how their child or grandchild is cared for during the first year following birth (or adoption).

Sam Smethers, Chief Executive of the Fawcett Society has welcomed the introduction of grandparents’ leave:

“It is good news for families and for all those working grandparents who provide significant amounts of childcare to support working parents. Half of working mums rely on grandparents for childcare when they return to work after having a baby. Most of the beneficiaries of this change will be older women and we know that it’s older women and mothers who are the groups most likely to be absent from our labour market.”

However, it is already clear that this new proposal is only one further piece of the jigsaw the Government must put together if it is to truly support working families and women in the workplace:

• It is still early days in assessing whether shared parental leave will become part of the “norm” for fathers who wish to take time off work to care for their child. Concerns have been expressed that that this new right for grandparents could make it less likely that fathers take up shared parental leave. Jo Swinson, the former employment relations minister who drove through shared parental leave in the last Government commented that “many men say they are concerned that taking shared parental leave will have a negative impact on their career… there is a real risk that cultural and economic factors combined with this grandparental leave policy will mean fewer fathers take parental leave than would have done so”. Sam Smethers has called for “the next step… to be to create a substantial dedicated period of leave for fathers paid at a rate that dads can afford to take, and which would really see women and men sharing care more equally”. However, there has been no indication from the Government that there will be any further developments in this regard.
• Shared parental leave is also only available for a limited period of time – a child’s first year. After that time, an employee’s rights to manage their work and care for a child are limited to the right to take unpaid parental leave (or dependant’s leave in an emergency), their holiday entitlement and a statutory right to request flexible working. The real issue for many parents remains the cost of childcare for pre-school children. The Government has brought forward plans to start rolling out 30 hours of free childcare for working parents of 3 and 4 year olds from 2016 (at present all parents of 3 and 4 year olds are entitled to 15 hours of free childcare) (see here). In 2017 (delayed from this Autumn), a new tax free childcare allowance in respect of a child under 12 is due to be introduced. This will be available where both parents work and in total earn below £150,000 (see here). This new allowance will replace the existing childcare voucher scheme operated by employers (although employees who are already members of childcare voucher schemes will be entitled to remain within existing schemes). Whilst this will benefit some families, others who would have benefitted under the voucher scheme will lose out.

 So what does this mean for employers?

Employers may be understandably nervous about an extension to shared parental leave, given the already complex regulations. A pressure to extend any more favourable terms offered for shared parental leave to grandparents will also carry financial consequences and age discrimination claims could also be possible. Further detail on the Governments grandparental leave proposals will hopefully clarify whether a “one size fits all” approach will be required. In the meantime, grandparents can still support their immediate families via the statutory right to request flexible working and the right to take unpaid dependants leave in an emergency depending on their individual circumstances.

With an increasingly ageing population in the UK, the Government is keen to encourage grandparents to continue working for as long as possible. A return to a mandatory retirement age is presently off the cards. Indeed, the introduction of grandparental leave together with the existing age discrimination protection may mean we see an increasing rise in over 65s in the workplace. And with grandma perhaps more likely to be involved in childcare than granddad, will granny leave mark a rise in sex discrimination claims from those who feel unfairly treated as a result of caring for, or requesting to care for, their grandchildren? An older workforce brings with it many new issues for employers and which many organisations are only now starting to grapple with – employers will need to give careful consideration as to how they respond when grandparental leave is added into the mix.