Shared Parental Leave and Pay: changed mindset for 2015

The Government has recently published its consultation document on Shared Parental Leave and Pay which is to be introduced in 2015. Whilst this is still some way off, it will make a big change to the arrangements parents can make to care for a new arrival.

The concept of Shared Parental Leave and Pay is that the partner of a woman who has had a child will be entitled to take a share of what was the mother’s maternity leave and statutory maternity pay, to be known as ‘Shared Parental Leave and Pay’ (ShPL).

Currently mothers have the right to 52 weeks of maternity leave and subject to some qualification requirements they are entitled to statutory maternity pay for 39 weeks. Under the proposed scheme, mothers will be able to formally end their maternity leave early so that the couple can elect to enter into the ShPL scheme. That will entitle them to take ShPL concurrently (for example, both taking 26 weeks off after the birth of their child) or alternate when the mother and the father take leave for the remainder of the ShPL period which cannot be longer than any unused maternity leave, including the receipt by the parent who is taking the ShPL of the remainder of any statutory maternity pay.

Both parents need to satisfy a basic ‘economic activity’ test, which sets a low earnings threshold and an ‘individual eligibility’ test, which requires both parents to have at least 26 weeks’ continuous service with the same employer as at the 15^th week before the baby’s due date and still be working for the same employer when they intend to take leave.

A woman and her partner will have to give at least 8 weeks’ notice to their respective employers of the intention to opt into the ShPL scheme. That notification does not currently require either the father or the mother to give details of their spouses’ employer so that each employer can ‘cross check’ the entitlements of the other or the information that has been given to each employer but employers will be able to request this information from their employee and the employee will be obliged to provide that information if they wish to take the leave.  There does not however seem to be an obligation for the employer to actually share information with the other affected employer.

Once the parents are operating under the ShPL scheme, the current proposal is that both parents can agree to transfer their share of the weeks of leave and pay from one parent to the other.

The sting in the tail of what would otherwise be a welcome reform is that there is no limit to the number of times the parents can transfer leave and pay entitlements between them but they will be required to give their employers 8 weeks notice of any change. This does seem to raise the prospect of employees technically being able to swap leave and pay every 8 weeks for the duration of the 52 weeks of what would have been maternity leave.  The Government says it is confident that this would not happen in practice but not requiring blocks of leave to be fixed from the outset (subject to a permanent return by either parent) does introduce complexities for finding competent cover for employers.

The Consultation on this scheme closes on 17 May 2013 and we will keep you updated with all developments.

If you would like any further information about this issue, please contact me by emailing linky.trott@edwincoe.com.

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