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Additional paternity leave: Sleepless nights for businesses?

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PaternityIf Lord Mandelson is overruled and the government’s proposed additional paternity leave and pay legislation does eventually come into force, what will it mean for businesses? Christiana Tollast spoke to the experts and found this is a subject of much-heated debate.


The law

In 2007, the government drew up a consultation document on its proposed additional paternity leave and pay (APL&P) law, which was intended to be introduced by the end of this parliament.

If put into force, the law would enable employed fathers to take up to 26 weeks’ APL, some of which could be paid if the mother returns to work during the second six months of the child’s life.

However, Lord Mandelson’s recent call for a moratorium on any measures that would add to the current financial pressure on businesses during the downturn, means a large question mark now hangs over the legislation’s viability. But, with the increasing move in Britain towards better work-life balance, is it not arguably only a matter of time before APL does come into force?

“I wouldn’t be surprised if this goes quiet for a while, but then does eventually rear its ugly head again.”

Nicola Brown, Thomas Eggar

Nicola Brown, employment lawyer at law firm Thomas Eggar, thinks so: “I wouldn’t be surprised if this goes quiet for a while, but then does eventually rear its ugly head again. I don’t think it will be abandoned altogether.”

Brown’s use of the word ‘ugly’ speaks volumes about how this legislation has been received by certain parties and Lina Hogg, of HR consultancy Picasso, explains why: “We are seeing SMEs and larger organisations really struggling with the economic downturn. To have this [legislation] put on them when they are already getting their staff to work harder, especially when redundancies have been made, could be crippling if it means having a key individual from a team being away for up to six months.”

Teething problems

More specifically, Brown says there are many potentially complex issues surrounding the proposed legislation, one of which is that the APL will only kick in once the mother has returned to work: “What exactly that means and how the father’s employer is supposed to get confirmation of the fact that the mother has returned to work, is going to be potentially very difficult.”

Brown also raises concern over the potential problems for employers in getting cover for relatively short periods of time, compared to maternity leave, where people are more likely to be off for a longer time and employers can get fixed-term maternity cover contracts. “If someone is saying, ‘I might take three months’ paternity leave’, then actually getting someone in to cover could be very tricky.”

But, while Hogg predicts that the very large organisations and public sector will cope with the legislation far better than smaller businesses, Jeremy Thorne, HR consultant, thinks it will cause big problems for larger organisations too, especially where people do very specialist jobs. “No one is suggesting people don’t take paternity leave, but APL just adds to the weight of the problem. A specialist role could mean knowledge of the company is really important, so just having one person missing can be absolutely critical, and very often complete projects grind to a halt.”

First steps

The problem for businesses in preparing for this new legislation, says Brown, is that until the final version of the draft is available, it is difficult to know just what the other key issues will be for businesses to get to grips with.

“APL could start to challenge the gender stereotype, that only women take time out to care for children and therefore women are a burden.”

Elizabeth Gardiner, Working Families

Hogg advises that, in basic terms, the legislation would mean all the family-friendly documentation, particularly the policies concerned with paternity leave, would have to be changed. Although, she adds: “There isn’t enough guidance for employers to work out, for example, how they are going to track who is doing what, i.e. how much leave they have taken and how much leave their wife has taken in another organisation.”

Is Mandelson right?

Although there is a strong argument that businesses could do without further complications at this time, there is also a strong case that says the economic downturn is exactly the reason why the legislation should be brought about sooner rather than later, as Elizabeth Gardiner from Working Families explains: “In an economic downturn, we need to be keeping skilled women in the workforce. APL could start to challenge the gender stereotype, that only women take time out to care for children and therefore women are a burden. This was one of the main reasons why the government accepted the need for APL back in 2005. It would give families choices, based on their individual financial circumstances.”

The future for fathers

Gardiner concludes: “All the major political parties are committed to change in this area, so it will happen, it is just a question of how soon.

“It isn’t going to be a massive revolutionary measure causing huge amounts of cost and upheaval, but it is going to have the potential to make a really big difference to how people make decisions about organising their families and their work.”


The costs and benefits of APL&P

Costs

  • Smaller employers would be entitled to recover 100% of any additional statutory paternity pay payments they make, plus 4.5% compensation for the extra National Insurance Contributions payable

  • This is compared to a 92% recovery entitlement for larger firms

  • To some extent, this will offset the disproportionate impact on small firms, although other costs such as the cost of covering for absence will still remain.
  • Administrative costs to employers, as set out in the Regulatory Impact Assessment (RIA), that was published alongside the consultation, would arise from:

  • One-off changes to systems and HR practices. It has been assumed by the RIA that these costs would be borne by larger employers only, as it is assumed that smaller employers operate more informal payroll practices

  • Recurring costs due to administering the father’s pay and leave arrangements – this would apply to all employers.

    Benefits
    The RIA also set out a number of wider benefits to arise from APL&P, including:

  • Responding to growing numbers of fathers who want greater opportunities to care for their child

  • Providing both parents with more flexibility over their childcare arrangements

  • Enabling mothers to return to work earlier where their preferred option is for the father or partner to take over responsibility for caring for the child

  • Providing mothers with a real choice over their timing of return to the labour market also helps maintain an important source of labour supply.


  • Go to www.berr.gov.uk for further information on the draft consultation.

    One Response

    1. Equality – about time
      I’m afraid I think the negative slant on the opportunity for fathers to take APL (using some of the unused paid time off of the mother if she returns to work) is typical stereotyping and a load of nitpicking twaddle about the burden of administration. It makes it sound as though it’s OK for women to have time off to look after a new baby, but men are far to special and important to UK industry to possibly be allowed this time, and therefore are clearly more valuable than women. Why should the issue of covering a man’s role be any harder than it is to cover a woman on maternity leave?

      I have just returned to work after 3 months of maternity leave, and my husband has given up his work to become a full time Dad to our 2 children. This has been purely a financial decision as I am the main earner. The woman being the main earner in a household is not uncommon!! Therefore why should it be such a shock that families choose to have the Father stay at home – and who is to say that they don’t do just as good a job of raising children as women. However – in order to do this, he will get no financial compensation – and given that he has paid taxes and NI contributions – just like me, then why shouldn’t he get the proportion of my SMP that I have effectively given up to go back to my tax paying job?
      Equality is just a myth while views like this are abound and such stereotypes need to be challenged even if it takes legislation like this to do it.

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