Shared Parental Leave: a Simple Guide for Employers - Fleximize

Shared Parental Leave

What is shared parental leave and how could it affect your business?

By Michelle Last

On 5 April 2015, the government introduced new rules to enable employees who are parents to take shared parental leave in the first year of their child's life or placement for adoption. The new rules were introduced as part of a government initiative to enable parents to adopt a more modern-day, flexible approach to sharing childcare responsibilities.

Before the new rules were introduced, most fathers were only entitled to two weeks off following the birth or placement of a child. In principle, therefore, the new rules on shared parental leave and pay can be very attractive and helpful for new parents. In practice, they are hideously complicated and difficult to understand. The application of the new rules can also be problematic for employers, particularly when managing applications for shared parental leave and dealing with potentially unexpected absences and working patterns.

And if that isn’t enough to contend with, there is now a spate of employment tribunal litigation arising out of claims from male employees that, when they take shared parental leave, they should be entitled to the same enhanced pay as women who receive enhanced maternity pay when taking maternity leave.

What is shared parental leave?

Shared parental leave is a new type of leave that can be shared between two parents in the first year of a child’s birth or placement. Under the new rules, a mother can end her statutory maternity leave and statutory maternity pay early and sacrifice the remainder of her statutory maternity leave and statutory maternity pay so that she may share that balance with her partner. Her partner may then take shared parental leave and shared parental pay. This enables both parents to take time off together to care for their child, or to alternate their time off to care for the child.

Who is entitled to shared parental leave?

To be eligible for shared parental leave, an employee must have been employed continuously for 26 weeks at the end of the 15th week before the expected week of childbirth, and remain employed while they take the leave. The employee’s partner must also satisfy the ‘employment and earnings test’. This means they must have worked for at least 26 weeks in the 66 weeks leading up to the child’s expected week of childbirth or placement, and have earned an average of at least £30 a week in any 13 weeks.

Shared parental leave applies to those who share the primary responsibility for the child with another parent at the time of birth or placement for adoption. This includes mothers, fathers and adopters who are married, in a civil partnership, or living together in a long-term relationship. It also applies to parents who have applied to the court for a parental order following a surrogacy arrangement.

Sharing the load
Sharing the load:

Fathers in the UK can now share parental leave with their partners, giving them greater access to their child in the first year of its life

How do I know if my employee is eligible for shared parental leave?

The onus is on the employee to determine whether they are entitled to shared parental leave. The employer is entitled to rely on the information and declarations provided by the employee, and only needs to check the continuity of employment and earnings criteria for their own employee. An employer can, however, request a copy of the child’s birth certificate, and the employee’s partner’s employer’s details, within 14 weeks of receiving the notice of entitlement to shared parental leave.

How much shared parental leave may be taken?

The mother must take two weeks of compulsory maternity leave following the birth of her child. She can, however, then sacrifice the remaining 37 weeks of her statutory maternity leave and share this with her partner as shared parental leave. The partner can take shared parental leave at any time following the birth or placement of a child for adoption, up to the first year of birth/placement.

Shared parental leave can also be stopped and started. Employees are able to give three separate notices booking (or cancelling) leave, and employers can decide whether to allow more. The leave can be taken as one continuous block or discontinuous blocks of not less than one week.

If an employee requests to take shared parental leave in discontinuous blocks, the employer is entitled to a two-week period to discuss alternative patterns of leave with the employee. However, if the employer and employee cannot agree on an alternative pattern of leave, the employee will be able to take their leave in a continuous block on the date the first period of discontinuous leave was requested to start. In theory, the employee could subsequently serve a further notice, effectively enabling them to break up their leave, whether or not the employer likes it.

In practice, employers may find it difficult to accommodate blocks of leave, yet the rules provide employees with the option to take leave in blocks. To minimize problems for the business, employers are recommended to enter into a dialogue with the employee to agree a workable solution.

Childcare choices
Childcare choices:

Parents can take time off together to care for their child, or alternate their paternity leave throughout the year

Who is entitled to shared parental pay?

To qualify for shared parental pay, the parent must have earned above the ‘lower earnings limit’ of £111 in the eight weeks leading up to and including the 15th week before the child’s expected week of birth or placement date. Meanwhile, the other parent needs to have passed the employment and earnings test.

How much shared parental pay is an employee entitled to?

Shared parental leave is paid for up to 39 weeks, less the amount of statutory maternity pay or maternity allowance received by the mother. The current rate of shared parental pay is £140.98 per week or 90% of the employee’s average weekly earnings, if lower.

Under the rules, employers are not obliged to pay enhanced shared parental pay, or even match shared parental pay with enhanced maternity pay. This is leading to employment tribunal claims because men are arguing there is now no difference between a woman taking maternity leave and a man taking shared parental leave as both have the same childcare responsibility.

What is the issue with pay during shared parental leave?

Although mothers on maternity leave are often entitled to enhanced company maternity pay, very few employers pay enhanced shared parental pay. There is no statutory requirement under the new regime to provide an enhanced rate of shared parental pay, but whether or not to do so, and if so, on what terms, will be an important consideration for employers.

A number of recent employment tribunal decisions have held that it is discriminatory for an employer to pay enhanced maternity pay to a woman but not to pay enhanced parental pay to a man. There have also been employment tribunal decisions that have held it is not discriminatory to differentiate in this way. We therefore need to await an appeal to the Employment Appeal Tribunal, the next higher authority, for a binding decision, although this may be years away.

These decisions may, in the interim, lead some employers to pay enhanced shared parental pay, or to reduce maternity pay to statutory maternity pay. Employers are advised to give careful consideration to their current pay arrangements on the birth or adoption of a child, and to take advice on any claims for enhanced pay from an employee taking shared parental leave.

About the author

Michelle Last is a consultant solicitor at Keystone Law, specializing in employment law. She is a regular contributor to the press and has been published in The Times, The Financial Times, The Sunday Times, HR Director and Personnel Today, among other titles. Last is frequently ranked as the “most viewed” employment law solicitor and regarded as a “thought leader” on LinkedIn.