There has been increasing publicity recently about the new shared parental leave regime which will, from 1 December 2014, for the first time, allow parents to share up to 50 weeks’ leave. This is one of the most radical of the Government’s recent employment law reforms and will undoubtedly have a significant impact on both employers and employees. It completely overhauls the existing system of maternity and paternity leave for those parents who wish to share leave with their partners. Features of the new regime of particular note are that couples can take leave together or separately; leave can be taken in a continuous block or in discontinuous blocks of one week at a time; and an employee can vary the leave dates they have requested up to a maximum of three times.
Most employers are already broadly aware that family-friendly rights are facing the biggest changes ever seen, however, many have yet to realise how soon they might feel the impact of the implementation of shared parental leave (SPL). The majority of the new regulations will come into force on 1 December 2014 and will apply to parents expecting a baby on or after 5 April 2015. This means that any eligible employees who have become pregnant since July 2014 or who become pregnant from now will fall under the new regime and be entitled to share up to 50 weeks’ leave. There is therefore only a matter of weeks left to get systems in place.
Employers should be taking steps to put in place appropriate policies and procedures so that they are able to inform employees about their rights and obligations. It will also be essential to train staff and managers on the new regime. The legislation which has been published to date is complex and places onerous burdens on both employers and employees which means that understanding and implementing the new regime is not going to be straight forward.
The top three areas we anticipate are likely to cause headaches for employers are:-
The new rights raise questions about how employers should deal with pay during shared parental leave, particularly where they offer a scheme of enhanced pay during maternity leave. Addressing this appropriately will be key to maintaining good employee relations and ensuring that there is no discrimination. However, the legal issues in this area are not straight forward and employers should therefore tread carefully in making any decisions.
There is the potential for direct discrimination in relation to pay if an employer offers an enhanced maternity pay scheme but does not mirror those provisions in a shared parental pay scheme. Potentially a man on shared parental leave could seek to compare himself to a woman on maternity leave and argue that he is being treated less favourably because he is not entitled to enhanced pay. This is a particular risk in light of the removal of the exclusivity of maternity leave for women – leave is now interchangeable after just 2 weeks which gives rise to the argument that a man taking SPL at any time after 2 weeks should be entitled to the same pay which a woman would receive if she was on maternity leave at the corresponding point in time. There are also potential claims for indirect discrimination, for example if the shared parental pay policy disadvantages more men than women – which it may because women will have the choice as to whether to continue on an enhanced maternity scheme whereas men will not.
Discontinuous periods of leave
Under the new regime, employees will be permitted to request either a continuous period of leave or discontinuous periods of leave in blocks of a week at a time. Where a request is made for a discontinuous block of leave, the employer can either consent to the leave dates, suggest alternative dates or refuse the request. Employers should put in place rigorous systems for dealing with discontinuous leave requests as they are only given two weeks in which to consider/discuss the request with the employee. Given this very short time period, policies should specify exactly who such leave requests should be directed to in order to avoid the risk of a request languishing in a manager’s in-box and not reaching HR until the two week window has passed. Further, any refusal of a request for discontinuous leave will have to be handled very carefully to avoid constructive dismissal claim and/or claims of discrimination where, for example, mens’ and womens’ requests are treated differently.
Communications between employers
There will there be no central co-ordination of how the 50 weeks’ leave is being shared between parents which has caused some employers to express concern that there is a risk of both parents taking time that amounts to over 50 weeks in total.
The Regulations which have been published do not provide for any communication between employers. Instead, the provisions require each employee to comply with detailed notice and evidential obligations, in which they must provide information about, and include signed declarations from, the other employee. Each employee must also give the name and address of the other employee’s employer. However, beyond this there are no provisions to facilitate communication between employers. The notices to be given by each employee require them to tell their employer how much SPL is available and how much each parent intends to take. As such, the system could be open to fraud but the Government considers that the system of notices and evidence proposed is sufficient to prevent/deter this.
A suggested approach for employers is, as part of their implementation plan, to produce detailed notification forms for use by their employees which assist them to provide as much of the required information as possible. Forms and policies should also make clear that the employer will rely on the provided information; that if any information is found to be untrue there is the risk of disciplinary action; and also that the employer will share information with other employers if asked to do so.