Paid paternity leave firmly on the agenda – but shared parental leave remains unspoken and unused
Annelise Tracy Phillips, a senior associate in the Employment Law team at Burges Salmon LLP discusses why British Fathers are not taking up shared parental leave and why increasing paid paternity leave is likely to have more uptake.
In their Election 2017 manifesto the Liberal Democrats have promised to double paid paternity leave entitlements for working fathers. Labour promises a similar increase in the length of paid paternity leave and to increase the level of paternity pay as well.
No promises have been made about the coalition government’s flagship family policy, shared parental leave. Why has the focus shifted? It may be as a result of mounting evidence that fathers are just not taking it up.
Shared Parental Leave (“SPL”) was introduced in 2015 to allow eligible working couples more flexibility over how to care for their child during the child’s first year. The new right allows parents to substitute maternity leave for SPL, sharing 50 weeks leave and up to 37 weeks of Statutory Shared Parental Pay (ShPP). ShPP is set by statute and is currently £140.98 per week or 90% of earnings, whichever is the lower. Although it right sounds good in theory in practice statistics show that take-up of this new right has been low.
The Women and Equalities’ Committee conducted an inquiry ‘Fathers and the Workplace’ this year. That inquiry was dissolved because of Election 2017 however many of the experts who gave evidence to the inquiry agreed that the demand from working fathers who want to be able to participate in the care of their children is there, citing Working Families’ research data that 52% of fathers would like to take up Shared Parental Leave, but that there are significant barriers which prevent working fathers from doing so.
Money money money
When couples decide which of them should stay at home to look after a child finances undeniably play a key role. Many employers provide significantly enhanced maternity pay intended to increase their status as an employer of choice and to encourage experienced female workers to return to work after maternity leave. Few, however, made the choice to enhance ShPP in the same way.
This means couples choosing to take SPL may well be exchanging enhanced maternity pay for ShPP capped at £140.98 which, of course, doesn’t make much financial sense.
Even if no enhanced maternity pay is at stake, gender pay statistics (from the Office of National Statistics) show that there continues to be a persistent gender pay gap in the UK. In many families this means that the male parent will earn significantly more than the female parent. Because ShPP is capped at £140.98 for most couples in will make sense for the higher earner (generally the male) to stay in work and for the lower earner (generally the female) to take on the main family care responsibility.
The ‘fatherhood penalty’
Another survey looking at the take up of SPL found that 50% of fathers thought that taking SPL would be perceived negatively by their employers. Evidence given to the Women and Equalities Committee inquiry also suggested many fathers are afraid of the ‘fatherhood penalty’, – suffering detrimental treatment on return to work after SPL which then affects salary levels for the rest of their working lives. Given the wealth of evidence that women face a “motherhood penalty” fathers’ fears may be well placed.
Time to take action?
For the time being, employers are not obliged to make taking either paternity leave or SPL more attractive, either economically or in terms of career progression (although the potential for discrimination claims can’t be dismissed entirely for the employer who enhances only maternity pay).
Indeed, the Employment Tribunal recently found that a father who was entitled to receive only statutory pay under the employer’s shared parental leave policy was discriminated against by his employer. The decision was made on the grounds of sex as mothers on the employer’s maternity leave scheme were entitled to enhanced pay. (We understand that the employer intends to appeal this decision and, as this is an Employment Tribunal decision only, it is not binding.)
However, there may be both brand and workforce engagement benefits for employers who are able to accommodate the wishes of working fathers more effectively.
International evidence suggests that the effect of increasing the level of pay available to fathers taking leave can be quite startling. When the financial benefits available to fathers taking leave in Quebec were increased uptake went from 22% in 2004 to 69% in 2006. In Germany percentages of fathers taking leave rose from 3.3% to 29.3% in the five years (2007 – 2012) following increases in payments. With the current political focus firmly on workers’ rights, it will be interesting to see if the next government pushes this agenda further.