Shared Parental Leave: What do employers need to know?

Employers need to start preparing for the new “family” rights set to come into force later this year and which will apply to babies born or adopted on or after 5 April 2015. We set out below an overview of the new right to shared parental leave and shall be issuing further updates on what you need to do to prepare for this new regime over the coming weeks. Please also be aware that a new right for a prospective father or partner of a pregnant woman to attend two antenatal appointments comes into force from 1 October 2014 and changes to an entitlement of an employee to take adoption come into force on 5 April 2015. We shall be providing more information on these changes.

What is shared parental leave?

The government has recently published draft regulations which will allow parents to share leave for a year after a child is born or adopted. A mother will be able to end her maternity leave, maternity pay or maternity allowance early and share the remainder of her leave and pay entitlement with her partner as shared parental leave and shared parental pay. This will give parents greater flexibility over how they share childcare in the first year of their child’s life.

When will the new shared parental leave regime apply?

The new shared parental leave regime will apply to babies born or adopted on or after 5 April 2015. Employers may start to receive questions from their employees over the next few months and therefore need to prepare for this now.

Fathers of babies born before this date are entitled under the current law to additional paternity leave and pay. The right to take additional paternity leave allows fathers the right to take up to 26 weeks paid leave if the mother returns to work before exhausting her right to maternity leave. This right was introduced in 2011 but has seen a very low take up.

How will shared parental leave change things?

Shared parental leave offers employees far more flexibility than the current system of additional paternity leave. An employee will be able to take shared parental leave in up to 3 separate blocks (or more if the employer agrees) at any time prior to the child’s first birthday. Parents will be able to take leave separately or at the same time provided they do not exceed the overall leave available to them.

The right to take shared parental leave in up to 3 separate blocks rather than as a single continuous period of leave is likely to prove the most difficult aspect of the new regime for employers. For many employers it is difficult enough to cover an employee’s maternity leave and to keep their job open, without the additional burden of having to do so on a “stop start” basis.

Who is eligible?

A mother who is entitled to maternity leave, maternity pay or maternity allowance may curtail that entitlement and share the remaining balance of her leave, pay or allowance with her partner.

In order to take shared parental leave an employee must have been employed continuously for 26 weeks at the end of the 15th week before the due date and remain employed while they take the leave. Although their partner does not need to be an employee, they must fulfil the government’s test for being “economically active”.

In some circumstances only one parent in a couple may be eligible to take shared parental leave, in which case they will not be able to share the leave with their partner. In other cases a parent may take shared parental leave and choose not to share it with their partner. For example, a mother may choose to do so in order to take leave in blocks rather than as one continuous period of maternity leave.

How much shared parental leave can an employee take?

Parents can share up to 50 weeks of leave and 37 weeks of pay at any time between birth and the child’s first birthday. A mother must still take a minimum of 2 weeks’ compulsory maternity leave following the birth of her child and will not therefore be able to begin a period of shared parental leave until after this period. Her partner, however, may begin a period of shared parental leave from the child’s birth.

What notice should be given?

An employee must give their employer a notice of entitlement and intention to take shared parental leave at least 8 weeks before the first intended period of leave. This notice should set out the intended periods of leave and should include a declaration by the other parent consenting to the proposal and confirming that they meet the qualifying requirements. The employee will not be bound by these dates.

On receipt of this notice the employer may request a copy of the child’s birth certificate and the name and address of the other parent’s employer.

An employee must give at least 8 weeks’ notice of any leave they wish to take. This is done in a period of leave notice setting out the dates of their proposed leave. If the notice specifies a continuous block of leave, the employer is bound to accept it. If the notice specifies that the employee wishes to take a discontinuous block of leave, for example if the employee wants to work every other week over a particular period, the employer has 2 weeks to accept, propose alternatives or refuse it. If refused the employee may choose to take the total amount of leave requested as a continuous block.

An employee may serve up to 3 period of leave notices and is therefore entitled to up to 3 blocks of shared parental leave.

Shared parental leave must be taken in blocks of at least a week and the minimum period of leave which may be taken is one week.

Is shared parental leave paid?

Shared parental leave is paid for up to 37 weeks. The amount available will be reduced by the amount of any statutory maternity pay or allowance already received by the mother. The remaining amount of pay can then be shared between the parents taking shared parental leave. The current rate of shared parental pay is £138.18 per week or 90% of the employee’s average weekly earnings if lower. There is no statutory requirement under the new regime to provide an enhanced rate of pay but whether or not to do so and if so, on what terms, will be an important consideration for employers.

What steps do I need to take to prepare for the introduction of shared parental leave?

Employers need to be sufficiently familiar with the shared parental leave regime to respond appropriately to requests for leave and ask for further evidence where necessary. Employers should give some thought to how they may respond to a request for a discontinuous period of leave.

Employers should consider putting a policy in place setting out eligibility and notice requirements in relation to shared parental leave.

As well as dealing with the mechanics of the shared parental leave regime, employers should ensure that managers are well versed in employees’ rights to take shared parental leave. Employee are protected from dismissal or from suffering any detriment because he or she took or intended to take shared parental leave. Managers should therefore avoid making any statements regarding the inconvenience or cost of an employee wishing to take share parental leave as this may well be used as evidence in any later dispute.

We shall be providing further guidance on all these issues but in the meantime, please do not hesitate to contact your usual OC Contact.

Are employees likely to take up this right?

The take up of additional paternity leave has been very low – only about 0.6% of eligible employees have taken up this right. Even with the greater flexibility offered by shared parental leave, it is difficult to believe that this new right will be significantly more popular. Perhaps the publicity surrounding the introduction of shared parental leave may make parents more aware of their rights and more inclined to take advantage of them. In practice shared parental leave is likely to be most attractive to couples where the mother earns more than her partner and there is therefore a financial advantage in her returning to work before the end of her maternity leave.