Navigating the Neonatal Care (Leave and Pay) Act 2023

The Neonatal Care (Leave and Pay) Act 2023 will come into force on 6 April 2025, introducing statutory neonatal care leave (SNCL) and statutory neonatal care pay (SNCP) for new parents. The Act aims to support approximately 60,000 new parents annually by providing them with up to 12 weeks of statutory leave and pay to care for babies requiring neonatal care.

The new system is not straightforward and will be challenging for new parents to navigate at what will inevitably be a stressful time for them. On that basis, it is all the more important that employers take the time to understand the framework from the outset. In this Law-Now we outline the qualifying conditions, entitlements and protections provided by the Act and suggest practical steps that employers can take to prepare.

Overview of Statutory Neonatal Care Leave

Eligibility and Conditions

Employees will only be eligible to take SNCL in respect of babies:

• born on or after 6 April 2025; and
• in receipt of neonatal care, commencing within 28 days of the baby's birth and continuing uninterrupted for at least 7 consecutive days (starting the day after care starts).

Eligible parents include the baby's biological parents, intended parents (i.e. under surrogacy arrangements), the partner of the baby's mother, adopters, or prospective adopters. Additionally, the parent must have or expect to have responsibility for the baby's upbringing and must take the leave to care for the baby.

Entitlement

Eligible parents will be entitled to take SNCL from the first day of employment.

They are entitled to 1 week of SNCL for each qualifying period (i.e. any week during which the baby receives uninterrupted neonatal care) that the baby spends in neonatal care, up to a maximum of 12 weeks.  The way the arrangements around qualifying periods work means that, for the first week the baby is in neonatal care, the parent cannot take SNCL (but may be on another form of family-related leave such as maternity leave at that time).

The leave must be taken within 68 weeks of the baby’s birth. So, for mothers wishing to take the maximum maternity leave of 52 weeks, there is still scope to take SNCL in full in addition within that time limit.

How is SNCL taken?

The rules for taking SNCL differ depending on whether the leave is being taken in a ‘Tier 1’ or a ‘Tier 2’ period.

Tier 1 period:

• The period from the start of neonatal care until the 7th day after the baby stops receiving neonatal care. For example, if the last day of neonatal care is a Thursday then the Tier 1 period ends on the following Thursday.
• There may be more than one Tier 1 period if the baby stops receiving neonatal care and then starts to receive that neonatal care again (provided that this happens within 28 days of the baby’s birth).
• During a Tier 1 period, SNCL may be taken in non-consecutive blocks of one week at a time, once accrued.
• In practice, it is most likely that fathers or partners not taking the primary maternity or adoption leave, will take SNCL during a Tier 1 period, when the mother or primary adopter is on maternity or adoption leave.

Tier 2 period:

• Any remaining period of time (within 68 weeks of a baby’s birth) that is not a Tier 1 period in which an employee is still entitled to take SNCL.
• Where there is only one Tier 1 period, the Tier 2 period will run from the day after the Tier 1 period ends until 68 weeks after the baby’s birth.
• Any remaining entitlement to SNCL after the end of the Tier 1 period can be taken all together in one block during the Tier 2 period.
• In practice, if a parent is on another type of family-related leave during a Tier 1 period, they may elect to add any accrued period of SNCL onto the end of that other leave type (within 68 weeks of the baby’s date of birth). It is most likely that this would be the case for mothers or primary adopters already taking maternity or adoption leave during the Tier 1 period when the SNCL accrues.

Notice Requirements

Given the circumstances surrounding an employee’s need to take SNCL, the notice requirements are flexible.

Employees should provide notice of their intention to take SNCL, including their name, the baby's date of birth, the dates neonatal care started and ended (if applicable), the chosen start date of the leave, the number of weeks of leave, confirmation that they meet the eligibility requirements, and confirmation that the leave is being taken to care for their baby. Such notice does not have to be in writing. However, the employee should try and give the employer the details outlined above in writing within 28 days of SNCL starting.

For Tier 1 leave, if possible, the employee should give notice before they are due to start work on the first day of absence in that week. Where this is not possible, notice should be given as soon as reasonably practicable. 

For Tier 2 leave, the employee must give their employer:

• 15 days’ written notice for one week of leave; or
• 28 days’ written notice for two or more consecutive weeks of leave.

Employers and employees can agree to waive the notice requirements.

Overview of Statutory Neonatal Care Pay

Eligibility and Conditions

The eligibility conditions for SNCP mirror those for SNCL, with the additional requirement that an employee’s earnings must average at least the lower earnings limit (which will be £125 from 6 April 2025) and they must have been employed continuously for at least 26 weeks by the ‘relevant week’.

The relevant week varies depending on the situation:

• For birth cases, it is the 15th week before the expected week of childbirth.
• For adoption cases, it is the week in which the adopter is notified of being matched with the baby.
• For other cases, it is the week immediately before the week in which neonatal care starts.

Payment and Notice Requirements

SNCP is paid at the same rate as other statutory payments such as statutory paternity pay which will be £187.18 per week from 6 April 2025. SNCP can be accrued in respect of two or more separate periods of neonatal care, where each period lasts for a minimum of 7 days without interruption, beginning with the day after the start date of neonatal care (as with SNCL).

The same notice periods and notice requirements apply to SNCP as they do to SNCL, and the employer and employee can also agree to waive them. An employee is not entitled to receive SNCP if they are also in receipt of statutory sick pay. Given that some parents may be signed off work due to the stress of the situation, this may be worth reminding them.

Protection for Employees

Employees taking SNCL are entitled to several workplace protections, similar to those provided for other types of family-related leave, as follows:

• Right to Return: Employees have the right to return to the same job after their leave. If this is not reasonably practicable, they are entitled to return to a suitable and appropriate job.
• Redundancy and Alternative Vacancies: If an employee's role becomes redundant during their leave or the additional protected period (18 months from the date of birth/adoption if at least six consecutive weeks of leave have been taken), they have the right to be offered a suitable alternative vacancy.
• Employment Terms and Conditions: Employees retain all terms and conditions of employment (excluding remuneration) during their leave period.
• Protection from Dismissal: Employees are protected from dismissal if the reason is related to taking or seeking to take SNCL, and any such dismissal would be automatically unfair.
• Protection from Detriment: Employees are protected from any detriment for taking or seeking to take SNCL.

 Next Steps for Employers

The regulations around SNCL and SNCP have proven more complex than originally anticipated, in particular with the concept of the Tier 1 and Tier 2 leave types. A parent in distress may struggle to navigate the rules around SNCL and SNCP, and employers should be mindful of this when handling related requests. 

Whilst Government and ACAS advice on the new rights is still awaited, employers should consider taking the following steps to prepare for the implementation of the Neonatal Care (Leave and Pay) Act 2023.

1. Review and update policies: Ensure that company policies are updated to reflect the new rights to SNCL and SNCP.
2. Train HR and management: Consider providing training and / or education to HR personnel and managers on the new rights, including eligibility criteria, notice requirements, and employee protections. In reality, an employer will likely encounter this issue on an irregular basis, so will need to consider the best way to raise awareness amongst staff in a proportionate way.
3. Communicate with employees: Sensitively inform employees about their rights to SNCL and SNCP, including how to apply for them. Employee networks can be an effective way of disseminating this type of information.
4. Establish procedures: Develop clear procedures for handling requests for SNCL and SNCP, including documentation and record-keeping requirements. The statutory scheme already provides for some flexibility in requesting SNCL and SNCP, but employers may also wish to consider what they can reasonably do to reduce the administrative burden on employees making those requests as far as possible. 
5. Consider enhancements: Employers may also wish to consider providing enhanced pay for a period of SNCL, above the statutory minimum. Given the complexity of the statutory scheme, offering enhanced leave and/or pay may afford employers greater simplicity and administrative ease.

By taking these steps, employers can ensure they are prepared for the upcoming changes and ready to provide the necessary support to an employee whose baby requires neonatal care.