Proposed changes to parental leave

Proposed changes to parental leave could result in increased leave and pay for both mothers and fathers

On 30 March, the Equality and Human Rights Commission (EHRC) unveiled radical proposals, in its Working Better report, to change parental leave .

It proposes that parents should each get four months parental leave (mothers would still get maternity leave), with at least eight weeks of this paid at 90% of pay and the rest at the statutory rate, currently £117.18. Fathers would be able to take their parental leave any time after the mother had completed six months ordinary maternity leave but before their child’s fifth birthday.

Also, the EHRC proposed that mothers should receive 90% of pay for the 26-weeks of maternity leave rather than just the first six weeks, as is currently the case. A third period of four months could be taken by either parent, eight weeks of which at 90% pay. Nicola Brewer, chief executive of the EHRC, said: “Flexibility is a tool many British businesses use to unlock talent.

Changing the way we approach parental leave could be one way of tackling the gender pay gap.” These proposals are unrelated to European Union plans, announced in early March, which aim to enforce more generous maternity rights by the end of this parliament. The EU plans would see UK staff entitled to full pay for the first 18 weeks of maternity leave, followed by 33 weeks at the statutory rate. But business minister Pat McFadden said the government was seeking the right to opt out of the EU rules. Kate Goddard, a policy and research officer for charity the Daycare Trust, said: “We support any increases to maternity pay.”

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An existing government plan will have more impact on employers. It will increase how long women are entitled to statutory maternity pay (SMP) from nine to 12 months by the end of this parliament. But these plans were called into question last month, when business secretary Lord Mandelson urged a moratorium on any proposals that put businesses under pressure. The moratorium would halt maternity pay plans as larger employers are liable for a percentage of SMP.

Under the Maternity and Parental Leave Regulations 2008, employers are also obliged to continue to provide non-cash benefits, such as childcare vouchers, throughout an employee’s maternity leave, including during any period of unpaid leave. Where these are provided via a salary sacrifice arrangement, during unpaid leave, the additional cost must be borne by the employer. Some employers, therefore, may reconsider offering such perks altogether, particularly in the current economic climate. Any changes to the way such benefits are funded, however, could fall foul of sex discrimination rules. Lynne Keeble, product manager at Accor Services, said: “If [employers] communicate [childcare vouchers] to all their working parents and try to encourage those with older children to take them up, they are going someway to mitigate their risk.”