New family friendly entitlements for employees

United Kingdom

Parents and carers are set to benefit from new workplace entitlements after three government backed private members’ bills received Royal Assent on 24 May 2023. The Neonatal Care (Leave and Pay) Act 2023, Carer's Leave Act 2023 and Protection from Redundancy (Pregnancy and Family Leave) Act 2023 provide the statutory framework for the introduction of these entitlements for eligible employees. 

The Acts provide for:

  • Up to 12 weeks’ paid neonatal care leave, in addition to other statutory leave and pay entitlements such as maternity and paternity.
  • Up to one week’s unpaid leave per year for employees caring for a dependant with a long-term care need.
  • Extending existing redundancy protections to pregnant women and new parents after they return to work.

Timescales for implementation of these new entitlements are not yet known. The government says in its press release that it will lay down secondary legislation (i.e. regulations) “in due course” to implement them although the neonatal care and pay entitlement is expected to be delivered in April 2025. 

The scope of the new entitlements and their impact for employers are considered in more detail below.

Neonatal care leave and pay 

One in seven babies in the UK are admitted to a neonatal unit every year. Without specific statutory entitlement to leave, parents must rely on other family related leave entitlements and sick leave or even give up work in order to care for their child. There are also financial implications as families lose on average nearly £3,000 of income while their child is in neonatal care. The government’s press release says that the new entitlements will allow parents to be with their babies instead of worrying about work.

Employees with a parental or other personal relationship with a baby that is receiving, or has received, neonatal care for more than 7 continuous days before they reach 28 days old will be eligible to take neonatal care leave. “Neonatal care” covers medical or palliative care – the details of which will be specified in regulations.

Eligible employees will have a ‘day one’ right to neonatal care leave; there is no qualifying service requirement. The leave must be taken before the end of a period of at least 68 weeks from the child’s birth date. The leave can be taken after maternity or adoption leave periods (because the start of those periods is triggered by the birth/ placement of the child). Neonatal care leave can be used more flexibly with other types of family-related leave, such as paternity leave. 

The right to neonatal care pay, like other forms of statutory parental pay, will be subject to minimum earnings and service thresholds. Eligibility is conditional on an employee having at least 26 weeks’ continuous service with their employer and normal weekly earnings of at least the lower earnings limit (currently £123 each week) for a period of 8 weeks prior to taking the leave. Neonatal care pay will be at a fixed or earnings-related weekly rate to be prescribed by the regulations. This is likely to reflect the statutory rate for paternity, shared parental and parental bereavement pay which is currently the lower of 90% average weekly earnings or £172.48 per week. A percentage of the payments may also be reclaimed from the government.

Regulations will also set out additional information about how these entitlements will operate in practice, for example where an employee is eligible for neonatal care pay for babies who are part of a twin or multiple pregnancy, or where a child needs neonatal care on more than one occasion. Additionally, this right will apply to both mothers and fathers, in contrast to some existing family leave rights, which may cause complications if both parents work for the same employer.

Carer’s leave

The Explanatory Notes to the Carer’s Leave Bill suggest that around 2 million employees in the UK, the majority of whom are women, are balancing work alongside unpaid caring responsibilities. This number is only likely to increase with an ageing population. Carers often use existing entitlements to parental leave and/or time off for dependants to meet their caring responsibilities but these entitlements have limitations. Parental leave only covers children up to the age of 18. Other dependants such as elderly parents are not covered. Time off for dependants only applies where there is an unexpected or sudden event such as an injury or an assault and so does not cover day to day caring responsibilities such as accompanying dependants at routine hospital appointments.

Carer’s leave will provide greater flexibility for employees who will have a day one right to take up to one week’s unpaid leave per year to provide or arrange care for a dependant with a long-term care need.

A ‘dependant’ means a spouse, civil partner, child or parent of the employee, someone who lives in the same household as the employee (other than as a boarder, employee, lodger or tenant) or someone who reasonably relies on the employee for care who has a long-term care need. A ‘long-term care need’ means: (i) a long-term illness or injury (whether physical or mental) requiring or likely to require three months of care or more; (ii) a disability as defined in the Equality Act 2010; or (iii) care connected to old age.

Employees will be required to give notice of their intention to take carer’s leave but cannot be required to provide evidence in support of a request to take the leave. Employees will be able to choose to take five days off in a row, or to take individual or half-days as required. While employers may be entitled to postpone a period of carer’s leave in circumstances to be specified in the regulations, they cannot unreasonably postpone or prevent an employee from taking carer’s leave.

Employees taking carer’s leave will be given the same employment protections that exist for other types of family-related leave, meaning they will be protected from dismissal or detrimental treatment.

Extended redundancy protections

The government’s press release refers to research commissioned by the (then) Department for Business, Innovation and Skills and the Equality and Human Rights Commission which included a finding that 3 in 4 (77%) of 3,254 mothers said they had a negative or possibly discriminatory experience during pregnancy, maternity leave and/or on return from maternity leave.

Current legislation means that parents on maternity, adoption or shared parental leave are protected from redundancy during their leave and an employer must provide the employee with a suitable alternative vacancy if one exists. However, this protection does not apply during pregnancy, or to the period after taking the relevant leave.

The Protection from Redundancy (Pregnancy and Family Leave) Act 2023 will provide pregnant women and new parents with greater job security by extending the existing protections to cover a ‘protected period of pregnancy’ and a period after an employee’s return to work from family leave.

The ‘protected period of pregnancy’ will be set out in regulations. Based on the government’s response to its consultation on extending redundancy protection for women and new parents, it is expected that this will apply from the date the woman informs her employer of her pregnancy (which would be consistent with the position under discrimination law). The Explanatory Notes do however raise the possibility of the protected period commencing in circumstances where an employee has not informed her employer of the pregnancy, in particular if she suffers an early miscarriage. The Act does not specify the length of the period of protection after an employee’s return to work but this is expected to be six months.

This means that an employer who is proposing to make redundancies will need to account for a wider pool of employees (covering pregnant women and new parents who have recently returned to work from family leave as well as employees on maternity leave) when prioritising offers of suitable alternative employment in order to avoid potential claims of discrimination and/or unfair dismissal.

What do these additional rights mean for employers?

No immediate action is required by employers given that the new entitlements are not expected to come into force for some time and while the detail remains unclear. However, in due course employers will need to prepare for the introduction of these new entitlements in the following ways.

  • Reviewing and updating staff handbooks and HR policies to cover these new entitlements.
  • Communicating the changes to employees.
  • Considering how the new entitlements interact with existing family friendly entitlements including, in particular, any enhanced rights to pay or leave.
  • Considering whether to enhance the minimum statutory entitlements (e.g. by providing up to 5 days’ paid carer’s leave) which can be an effective way to recruit and retain talent. 
  • Ensuring that external payroll providers are ready for the changes.
  • Training HR and managers to ensure that they are aware of these changes and ready to deal with them in practice. 

If you would like to discuss any of these issues in more detail, please get in touch with your usual CMS contact.

Article co-authored by Haleemah Shaffait, a trainee solicitor in the employment team at CMS.