Some employers have been guilty of a head in the sand approach to the introduction of Shared Parental Leave rules. As the clock ticks towards the 5th April deadline, Gabriella józwiak takes a look at the issues of pay and equality they need to tackle.
Good for families, good for business and good for our economy,” is how deputy prime minister Nick Clegg described the government’s new Shared Parental Leave (SPL) scheme in November 2013. Almost a year on, employers are preparing for the more flexible rights for parents to come into force on 5 April next year. But some are unsure how to deliver the entitlements and whether they will create an administrative nightmare. With the first babies to be born under the new arrangements already gestating, the clock is ticking.
SPL enables eligible parents to share some of the 52-weeks maternity leave previously available only to mothers. By opting in to the system, a mother can end maternity or adoption leave or pay early and share the remaining weeks with her partner. In this time, they will be able to claim statutory Shared Parental Pay (ShPP). SPL is flexible, with parents allowed to book up to three separate blocks of leave.
The changes aim to promote equality in the workplace by enabling women to return earlier without having to finance childcare. They also encourage men to spend time with their young children. “Shared parental leave is an important change that will shred outdated stereotypes about who should do what, and let parents get on with making their own decisions about how they manage work and family life,” a spokeswoman for the Department of Business, Innovation and Skills (BIS) told Flexible Boss. “International comparisons, particularly with Scandinavia, show similar programmes involve long-term cultural change about expectations of gender roles and who does the childcare.”
Employment experts, however, suggest SPL will still create a division between working men and women. A major concern is pay. ShPP will be paid at £138.18 a week or 90% of an employee’s average weekly earnings, depending on which is lower. Employers can decide whether to enhance ShPP in the same way as many enhance maternity pay.
A survey of more than 2,100 men published by the National Childbirth Trust in May found 30% would not consider taking up SPL, with 45% saying this was because paternity pay was too low. The BIS spokeswoman agrees pay is a barrier. The department expects higher rates of take-up where employers offer occupational pay schemes. It estimates an initial take up of between 2% and 8% of eligible fathers.
Simon Kerr-Davis, an employment lawyer with international law firm Linklaters, says the decision to enhance pay will depend upon whether employers “see family-friendly rights as being an employer-of-choice issue”. He points out that since 2011, fathers and partners have been entitled to up to 26 weeks Additional Paternity Leave (APL) and up to 19 weeks pay, once the mother has returned to work. However, the scheme has had little impact, with a TUC survey from June 2013 revealing just 0.6% of eligible fathers had taken it up. “Employers really didn’t choose to enhance APL – even people who had very generous maternity leave tended not to,” he says.
Problems with APL were highlighted in September this year when an employee brought an employment tribunal against car manufacturer Ford. He claimed direct and indirect sex discrimination because Ford paid him statutory paternity pay during five-months of APL, whereas Ford’s female employees were entitled to enhanced pay.
The tribunal ruled that Ford had not directly discriminated against the claimant, Mr Shutter, because he had incorrectly compared himself to a female employee who had taken maternity leave. He should have compared himself to a female partner on APL, who would have received the same statutory rate.
Ford also successfully argued its practice of not paying enhanced paternity pay was necessary to achieve an increase in the number of woman it employed, as it had a male-dominated workforce and significant statistical evidence to support this contention.
Anna Fletcher, director of law firm Wragge Lawrence Graham & Co, believes that the Ford case will have implications for employers when deciding whether to enhance paternity pay. She suggests it could persuade employers to maintain statutory pay levels, but there is still a risk employees might bring discrimination cases in the future. “It may well be other organisations don’t have that rationale, as Ford did, for how they decided to structure their maternity policies,” she says.
She also suggests employers may choose to look at how they allocate their current budgets for maternity pay across both maternity and paternity pay. However, if that has the effect of reducing female employees’ entitlement to enhanced maternity pay, she says, that may impact on the attractiveness of couples taking up SPL proposals, and negate the impact of government policy in this area.
Breaking the bank
Sarah Jackson, chief executive of campaigning charity Working Families, is more positive about employers’ intentions to enhance pay. She says modelling done by companies she supports shows that enhancing paternity pay will not break the bank.
“If the take-up is around 10% of their eligible fathers, and they’re going to take maybe four weeks off, the new costs will be in the region of [that of] up to three additional maternity leavers out of every 100,” she explains. “For a large private sector organisation, it’s not going to cost them a huge amount to match their paternity or ShPP. What I hear from them is that cost is worth it in terms of promoting equality in the workplace, which is encouraging.”
From April, the civil service will offer enhanced shared parental pay. Other organisations have already implemented enhanced pay, such as the London School of Economics and Political Science (LSE). It pays paternity leave at full-pay rates, and offers up to 16-weeks additional paternity leave. “We took that decision because when APL was introduced we wanted to match the payment that our female employees receive with maternity pay,” says LSE human resources adviser Natalie Pancheri.
As a result of positive take-up of APL, LSE introduced an additional benefit that gives academic members of staff the option to have a term of paid research leave after 18-weeks paternity or maternity leave. “That really supports parents to build up their research profile and impacts on their opportunity for promotion,” says Pancheri. She adds that this is particularly beneficial for female colleagues, as there tend to be fewer women in senior positions. About six from a staff of 600 academics have taken the paid research leave since August 2013.
By the block
Under the SPL provision, parents are entitled to book up to three separate blocks of leave instead of taking it all in one go. Blocks can be as short as a week, which has left some managers wondering how they will cover frequent, short-term absences.
Employers have the right to turn down requests for block working and negotiate applications. This, says Jackson, has helped reduce employers’ anxiety. She also believes that few mothers will request short blocks, and sees benefits for women in the proposal. “If you’re a management consultant and you need to come back for six weeks to manage a high-level project, you can do that,” she suggests. “Similarly, you can imagine that for women in retail during the Christmas rush it might be handy to come back through December.”
Conversely, Jennifer Liston-Smith, director of coaching & consultancy at employment adviser My Family Care, says the flexibility may put pressure on women to return to work earlier. “They are concerned they will be regarded as selfish by their partner or employer if they take the whole year themselves,” she says.
SPL also offers parents up to 20 shared parental leave in touch (Split) days. These are in addition to 10 keeping in touch (Kit) days already available to people on maternity or adoption leave. Both are optional and have to be agreed by both employees and managers.
Liston-Smith says SPL’s combination of Split and Kit days and block leave constitutes “an extreme form of flexible working”. She says this development is in line with current workplace trends, following the introduction of legislation in June that allows workers to request more flexibility. “It’s one part of the continuing change in the way we view work, life and increasingly how generations coming into the workplace see work as a part of their life,” she says. But she cautions: “Will the leave a parent takes increasingly become one where they’re expected to answer emails while breastfeeding?”
In May, a study published by My Family Care and law firm Hogan Lovells suggested only 15% of employers had a clear plan about how to implement the new provision. Now, Liston-Smith says employers are getting up to speed and putting policies in place. But she says uncertainty about how to manage shorter periods of leave and pay means some HR departments “are not making a huge splash about it”.
She recommends employers target parents’ networks and communities with the information, particularly so as not to isolate ineligible employees. “There is sometimes a backlash against parents from employees who don’t have kids,” says Liston-Smith. “If employers are seriously nervous about their capacity to cope with SPL, some serious advice is to have the right policy in place and not overdo their obligation to tell people.”
Lynn Rattigan, deputy chief operating officer at professional services firm Ernst & Young (EY), agrees that SPL should be viewed as a continuation of increasingly flexible workplace practices. She says employers should approach plans to offer blocked leave as they would any absence request: “It’s always a business conversation. If it works for the business and for the individual, it’s not going to be a problem.”
EY is currently rolling-out a paternity coaching scheme, following its successful implementation of maternity coaching. Rattigan says this is not because of SPL – all staff are offered coaching so that the company’s approach to employees is “equitable”.
Later this autumn, the industrial mediation service ACAS will publish an SPL toolkit to help organisations prepare for the changes. In the meantime, Fletcher advises employers to use the opportunity presented by the new legislation to conduct a review of all workplace policies. She says HR teams should amend references to parental policies across work handbooks and intranets and advises that they train managers on how to answer employees’ questions. She also cautions firms to remember other forthcoming polices, such as the right for parents to take time off for antenatal appointments that began on 1 October and changes to adoption leave and pay that begin in April.
Jessica Chivers, managing director of employee engagement adviser Talent Keepers, suggests that managers should approach discussions about SPL positively and prepare to negotiate. “Put on a really curious mindset as an employer rather than closing down and being worried,” she suggests. “Try to be honest and open from the first moment.” She also recommends that employers rethink how to serve fathers in the workplace better, for example, by providing back-to-work coaching after long periods of SPL.
Chartered Institute of Personnel and Development head of public policy Ben Willmott says employers should start preparing for April, but not expect to be “deluged by a wave of requests”. “SPL is a positive change which hopefully over time can support a culture change where men are more likely to take an active role in the caring of their children in the first year,” he says. “It’s the right direction in terms of policy, but it’s going to be one of those slow-burn changes.”
This article was first published in the October issue of Flexible Boss Magazine.