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Sue Evans, partner at Lester Aldridge LLP, explains how proposed changes to maternity and paternity leave would affect employers The possibility of an employee going on maternity or paternity leave is most likely a factor considered by a number of employers (albeit subconsciously). Maternity involves considerations of both pay and absence for the employer. As the majority of maternity pay can be recovered from the government, it is often the issue of absence and return to work which causes greater practical problems.
Under current provisions, qualifying women receive 90% pay for their first six weeks of maternity leave, with the lesser of a prescribed statutory rate (currently £123.06 per week) or 90% pay for a further 33 weeks. An additional 13 weeks leave is then available bringing the total up to 52 weeks. Paternity leave is for two weeks and is paid at the lesser of the statutory rate or 90% pay. Either parent can take unpaid time off up until the child is five years old in qualifying circumstances.
The recent proposals from the Equality and Human Rights Commission (EHRC) suggest that for the first 26 weeks of maternity leave a woman should be paid at 90% of her salary. Beyond that, leave can be taken in three blocks of four month periods: one block for the mother, one block for the father and the third block for either parent. The proposition is that the first eight weeks of each block would be paid, half at 90% and half at the statutory rate. Long term, the plan is for this leave to be paid at 90% for 26 weeks, or 50% for 52 weeks. These blocks of leave can be taken anytime up until a child’s fifth birthday. The EHRC is also proposing that the requirement of a qualifying period of employment for entitlement to statutory maternity and paternity pay be dropped and that the two weeks of paternity leave should be paid at 90%.
These proposals are likely to have a significant impact upon an employer’s ability to undertake strategic planning for the future of the business. Only short term planning may be possible with the looming possibility (for a five year period) that an employee may opt to take substantial periods of leave.
Employees may also find that they do not form part of an employer’s longer term plans for a business just because they have young children, even if an employee may have no intention of taking such leave.
It may even be the case that when looking at two equally qualified candidates for a role, an employer will chose the male rather than the female. This could be discriminatory. If the government go ahead and change the law as proposed in the Equality Bill an employer will be able to do precisely the opposite – chose the woman, and this would not be discriminatory.
The dilemma for employers is that, with the EHRC’s proposals, it’s not only women of childbearing age who they will have concerns about hiring, as men too may also take substantial periods of leave. The issue raised in the question above is made potentially worse by the EHRC’s proposals.
There has been a mixed reaction to the proposals amongst business and equality groups – EHRC have called on the government to consider the report and proposals in the future. We will have to wait and see whether the proposals will be implemented in full or rather a more compromised approach adopted.
Sue Evans is a partner at Lester Aldridge LLP
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