Employers: Becoming a flexible friend

As the title suggests, this article is all about the requirement for employers to be flexible in the workplace. No, the government are not introducing mandatory yoga classes, although this could be a good source of stress relief at work but that would be a whole separate area of discussion. You may recall an article we published in the summer of 2011 all about a ‘modern workplaces’ consultation which focused on creating a society where work and family complement one another. It detailed proposals in four areas, two of which the government published a response to at the end of 2012. They are: a right for all employees to request flexible working; and the introduction of a system of flexible parental leave.

Flexible working
The right to request flexible working was first introduced in 2003 for employed parents of children under 5 (or under 18 if the child is disabled). The right was extended to carers of some adults in 2007 and then again in 2009 for parents of children under 17. Current legislation provides eligible employees with the right to request a change in their contractual working pattern from their employer and places a statutory duty on the employer to seriously consider it and only reject it where there is a clear business reason.

To qualify individuals must be employed with the same employer for more than 26 weeks before a request can be made; have or expect to have caring responsibilities for a qualifying child or adult; and can only make one request in any 12 month period.

The current statutory process will be replaced with a duty on employers to consider requests in a reasonable manner.  To make the process easier for employers, they will be given guidance on ‘reasonable’ in a statutory code of practice which is being prepared by Acas and is due to be published for consultation early in 2013.

Depending on which department looks after flexible working requests within a company, the change to it being a right for all will certainly be an additional administrative process for employers.

Flexible parental leave
The majority of proposals in the Modern Workplaces document surrounded the issue of flexible parental leave, with the government announcing that they wanted to introduce a system of genuine flexibility, giving parents more choice and facilitating truly shared parenting. They believe that the current statutory system, acts as a barrier to parents’ ability to share leave in the first year of their child’s life. The proposals aim to assist businesses during this time, allowing them to manage their staff in a more flexible way and to help retain qualified and talented employees.

The new system will build on the current maternity, paternity and parental leave arrangements. Parents will be able to discuss with their employers the patterns of leave that would best suit them, and come to a mutual agreement that works for both parties. The government do appreciate that fully shared childcare from day one will not be achieved as cultural attitudes do not change overnight, but they do believe that this new system has the capacity to bring about transformative change for parents and businesses, and is a major stepping stone towards achieving smart economics in the UK.

Current entitlements
With the current system employed mothers are entitled to 52 weeks of statutory maternity leave, 39 weeks of this may be paid and 13 weeks are unpaid.  Employed fathers who qualify are entitled to up to 2 weeks statutory paternity leave and also, subject to qualifying criteria, additional paternity leave (APL), which was introduced in 2011.  Once the baby is 20 weeks old, and providing the mother has returned to work, fathers may take up to 26 weeks of APL. 

This adds up to a total parental leave of 54 weeks (52 for the mother and 2 for the father), 41 of which are paid (39 weeks for the mother, two for the father).  Similar provisions also apply to adopters and same-sex couples. In addition, in the first year of a child’s life, parents who have been with their employer for at least a year are entitled to a further 13 weeks of unpaid parental leave per parent per child.  This can be taken from the time the child is born up until the child’s 5th birthday.  In the case of a child with a disability, the period of leave is 18 weeks per parent and can be taken up until the child’s 18th birthday.

Proposals
There have been a few significant changes from the original proposals; however we will just focus on the new proposals rather than comparing the two and adding confusion to an already complex administrative process.

The 52 weeks of maternity leave will remain in place as the default position for all employed women. Women who are currently eligible to receive statutory maternity pay (SMP) or maternity allowance will continue to be able to do so for 39 weeks, as they do currently.

Women with partners where they both meet the qualifying conditions for the flexible parental system will be able to end the mother’s maternity leave and pay, or commit to ending it at a future date, and share the untaken balance of maternity leave and pay as flexible parental leave and pay. The length of flexible parental leave will not exceed the balance of untaken maternity leave, and the amount of statutory flexible parental pay will not exceed the balance of untaken statutory maternity pay or maternity allowance available at the point at which the woman returned or commits to return to work.

Parents will need to meet certain earnings or length of service qualifying criteria to use the new flexible parental system and each parent will need to meet the qualifying criteria in their own right. Where possible, the criteria will mirror the criteria for existing entitlements such as maternity pay and allowance and paternity pay and leave. The government envisage that the criteria will be as follows: 26 weeks of continuous service with the same employer by the 15th week before the expected week of child birth; and/or to have worked for 26 out of the 66 weeks prior to the expected week of child birth, and to have earned a minimum average specified amount for 13 out of those 66 weeks.

Flexible parental leave must be taken in a minimum of one-week blocks. The amount available to each parent will firstly be agreed by the parents, and each will subsequently need to agree their individual pattern of leave with their employer. In the event that the pattern cannot be agreed, the leave defaults to a single block to commence on a date specified by the employee. This is of real importance to employers as potentially covering adhoc weeks here and there could be extremely challenging.

The government propose to introduce flexible parental leave and statutory flexible parental pay in 2015. They will also consider making arrangements for working parents who do not meet the qualifying requirements to receive statutory payments, however such a provision will not be introduced before 2018 to allow time for development and to ensure it interacts appropriately with the new Universal Credit system.

Paternity Leave: The aforementioned additional paternity leave (APL) is to be abolished, however working families will be given maximum flexibility in choosing how to divide leave and pay between them so in practice, parents could choose for fathers to be the primary carer of the child if that suited their particular circumstances.

The paternity leave and pay at the current level of 2 weeks will be maintained and there are plans to extend this in the future and make it more flexible, however in the current climate it is not an affordable option for both government and business.

Adoption leave and pay: Changes are also going to be made to the leave and pay available to adoptive parents to bring it more closely into line with the leave and pay rights available to birth parents. Statutory adoption leave will become a ‘day one’ right with no qualifying conditions for eligible adopters who are matched with a child for adoption.

Statutory adoption pay will be enhanced to 90 per cent of the primary adopter’s salary for the first six weeks, which mirrors the arrangement for statutory maternity pay. Working couples who adopt will also be able to opt in to the flexible parental system if they meet the qualifying conditions in the same way as birth parents.

Surrogacy: The subject of surrogacy hit the headlines again when the Modern Workplaces consultation was first and there was a call for mothers of children born through surrogacy to be given the same maternity rights as other mothers. 

The proposals do indeed include equal arrangements for intended parents of a child born through surrogacy who meet the criteria to apply for a Parental Order. They will be eligible for statutory adoption leave and pay and for flexible parental leave and pay if they meet the qualifying criteria. Both intended parents will also be entitled to time off to attend two antenatal appointments with the surrogate mother carrying their child.

Unpaid parental leave: From March 2013, unpaid parental leave will be increased from 13 to 18 weeks in order to comply with the revised EU Parental Leave Directive. In 2015, the age limit on parental leave will also be increased, from the current 5 years to 18 years, providing each parent the right to up to 18 week’s unpaid parental leave for each child under 18. There are no plans to make any changes to the current arrangements regarding notification and time limits on taking unpaid parental leave.

Next steps
From 2015 the government will implement the proposals for flexible parental leave, statutory flexible parental pay, time off for fathers to attend 2 antenatal appointments and increasing the age limit for unpaid parental leave. The legislation will provide the architecture for the flexible parental leave system and the government will launch a consultation early in 2013 to consider further the detail of how the new system will work. Regulations to increase the number of weeks of unpaid parental leave will also be introduced in 2013. The intention is to make it as simple to use as possible, building on the existing framework without creating unnecessary burdens and complexity for business.

About the author
The CIPP is the Chartered Institute for payroll and pensions professionals in the UK and has in excess of 5,000 individuals enjoying membership benefits. For further information visit
 www.cipp.org.uk