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Media Briefing Note: Employers and Parents Expectant as Shared Parental Leave Takes Effect

31 March 2015

LONDON, 30 March 2015 – The new shared parental leave (SPL) regime will come fully into effect on Sunday. The parents of babies due on or after 5 April 2015 will be able to share up to 50 weeks' leave and 37 weeks' statutory pay in the 12 months after the birth of a child if they wish to do so. SPL is designed to help women return to the workplace and allow men to have more involvement in caring for new babies. SPL can also be taken by adoptive parents.

Commenting on the SPL regime, Ed Bowyer, partner in Hogan Lovells' employment team, said:
"There has been a degree of concern expressed by businesses in the run up to SPL, particularly regarding how the proposals would work in practice. Previous research has shown the necessary internal administration and system changes required and the challenge of managing resource given the flexibility of the regime to be key concerns.

"Now is the time to put theory into practice, and whilst ultimately there are likely to be some revisions and adaptions required, it is positive to see that businesses are not only now ready for these changes; but broadly welcome them, recognising that they mark a major cultural shift.

"It is an exciting time for expectant parents, employers and employment industry professionals as we explore and experience the actual impact and opportunities of SPL".

Some challenges

A key issue for employers is whether to offer their employees enhanced shared parental pay and if so on what terms.

Ed Bowyer commented:
"While employers often want to support working parents, it is difficult to estimate the financial costs of offering enhanced pay when it is still unclear what the likely take-up of the new right will be.

"Employers have been considering issues such as whether offering enhanced maternity pay but only statutory shared parental pay risks a discrimination claim, whether to use pay policies to encourage parents to take SPL as a single continuous block to minimise business disruption and whether to minimise the cost of enhanced pay by providing enhanced pay on a "per couple" rather than "per employee" basis where both parents are employees of the business.

"Responding to such questions isn't just (or even primarily) a legal issue. More fundamentally employers need to consider what message their approach sends out about their attitude to shared parental leave – and whether any negative employee relations consequences outweigh the potential costs savings."

Key points to note on SPL include:

  • Employees generate an entitlement to SPL if the mother brings her maternity leave to an end early. The balance of any leave and pay becomes available to the parents as SPL, to be split between them as they choose.
  • Employees will be eligible to take leave if they have a sufficient period of service and their partner satisfies minimum employment and earnings criteria.
  • Employees have to give eight weeks' notice of their intention to opt-in to SPL and of any subsequent request for leave.
  • When a couple initially opt-in, they have to give a non-binding indication of how they are intending to take their SPL. This is intended to give employers more certainty about the pattern of SPL that is likely to be taken.
  • Employees are entitled to give up to three notifications of SPL (or changes to SPL), unless the employer is willing to allow more requests.  Again, this is to give employers a greater degree of certainty.
  • SPL must be taken within 52 weeks of a child's birth.
  • 20 days' work will be available to each parent during shared parental leave, in addition to maternity leave "KIT" days. 
  • The right to return to the same job will apply to employees returning from any period of leave that includes maternity, paternity, adoption and SPL that totals 26 weeks or less, even if the leave is taken in discontinuous blocks.

 
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