Why everything may be about to change for shared parental leave

Who’s Left Holding the Baby? Why Everything May Be About to Change for Shared Parental Leave

Since the introduction of the scheme in 2015, only 2% of eligible parents have taken up the opportunity to share their parental leave, according to figures from the Department for Business, Energy and Industrial Strategy. Organisations with 250 staff or more are being urged to publish their shared parental leave policies on their websites to improve transparency and encourage more employees who are about to become parents to take this up and to make their business more attractive to potential employees who are considering starting or extending their family.

New rules came into force in 2015 where up to 50 weeks of leave – 37 weeks of which are paid – can be shared by parents who meet certain criteria.  Mothers must still take the initial two weeks after birth, but they can then cut their maternity leave short and exchange it for shared parental leave. Both parents will then have a flexible choice of how to split up the rest of the leave entitlement – of up to 50 weeks.  Shared parental leave pay is £140.98 a week or 90% of an employee’s average weekly earnings, whichever is lower.

On the face of it, this should give new fathers (or the other parent or partner) the opportunity to stay at home caring for the baby.   However, figures released by HMRC showed 6,100 fathers and 542,850 mothers in England, and 250 fathers and 27,650 mothers in Wales, received a statutory payment to take time off work with their children in 2016/17.  The reason for the unpopularity of the scheme is unclear, but according to a recent survey by comparison site Money.co.uk, half of prospective fathers said they were unlikely to take shared parental leave because they earned more money than their partner when at work.

During their maternity leave, some mothers receive full pay rather than the statutory minimum, depending on their employer but this enhancement is often not extended by employers to shared leave. In April the Employment Appeal Tribunal ruled that it was not discriminatory to refuse a new father enhanced pay while on shared parental leave if women were given enhanced maternity pay. It said the purpose of maternity pay and leave is to recognise the “health and wellbeing of a woman in pregnancy, confinement and after recent childbirth”.

However, a case currently in the Employment Appeal Tribunal may be about to change this. The support services firm Capita is appealing against a ruling in June that it failed to give a new father full paternity leave rights. Mudassar Ali, whose wife had post-natal depression, was offered two weeks’ pay, whereas a woman is paid for 14 weeks. A Tribunal ruled in the first instance that Mr Ali, a call centre worker, had been discriminated against.

The outcome of the appeal against this decision will be binding for similar cases in the future. If the appeal is upheld, it is likely that this will further deter new fathers from opting to take shared parental leave.  However if it is not upheld, employers will need to make substantial changes to their policies on shared parental leave to avoid cases of discrimination being brought against them.

Liberal Democrat MP Jo Swinson, who was employment relations minister in the coalition government, has tabled a bill that would require large businesses to publicise what they offer parents who wish to take shared leave after the birth of their child. In a recent interview with the BBC she commented that “the problem is that currently the onus is on the job applicant to ask about these [shared leave] policies, but the very act of asking the question suggests to the employer that the candidate may be considering having a child.” Swinson claimed that more than 54,000 women a year lose their jobs because of discrimination around pregnancy and maternity. Fathers were also worried about the effect taking shared parental leave would have on their careers.

Explaining the need for employers to publicise their shared leave policies, she said it would be a “simple and practically effortless change” that would help address gender inequality and help employers attract and retain staff.  Swinson said publishing shared parental leave policies online would allow employees to compare their organisation’s policy with what others offered and use that information to ask for improvements.

Jill Miller, Diversity and Inclusion Adviser for the CIPD, said making policies public “could help break the taboo of employees asking about their entitlements, which many are often reluctant to do. More organisations being open about their parental leave policies sends a positive signal about its importance and could help to level the playing field in gender equality at work,” she added.

It may also help to level the playing field at home.  John Adams, from Dad Blog UK, is the main carer for his two children and describes the leave offered for men and women as inconsistent. He writes, “It’s small [the number of men taking up shared parental leave] but then this is the crux of the issue. If men aren’t getting the same rights as women, they can’t actually get involved in family life, they can’t afford to take the time off, so they don’t, so from the earliest days they are basically discriminated against.”

A survey of 500 managers conducted in 2014, by law firm Slater & Gordon, before the advent of shared parental leave revealed that a third of managers would rather employ a man in his 20s or 30s over a woman of the same age for fear of maternity leave, while a similar number would be wary of hiring a woman who has already had a child or hiring a mother for a senior role. Of those 500 managers surveyed, 44% said the financial costs of maternity leave to their business are a significant concern.

This would suggest that even if the benefits received by male and female employees are equalised during shared parental leave, employers may become more reluctant to publicise their shared leave policies as it would mean that more employees become entitled to those benefits.  It would also suggest that, should the Employment Appeal Tribunal find that paying a male employee on shared parental leave a different entitlement to a female employee on maternity leave is discriminatory, many business will have to radically rethink their policies on shared parental leave.

Fitchett & Co, Employment Law Specialists, are able to offer advice and support to employers and employees who have been affected by any of these issues. Call 01483 243 587.