Rights of fathers
The Government's intention behind this new right is to provide flexibility in child care responsibility to enable a sharing of leave entitlement between parents who want this - but to balance the impact by providing that parents can't take time off at the same time.
What is the father entitled to?
Fathers are entitled to take from two to 26 weeks Additional Paternity Leave (APL) before the child's first birthday if married to, or the partner of the mother.
The current two week entitlement has been renamed: "Ordinary Paternity Leave" (OPL) but remains otherwise unchanged.
As with OPL at the moment, APL may only be taken in weekly blocks. In addition, APL can only be taken once - so fathers have one opportunity and must decide how much they wish to take.
How do fathers qualify for APL and APP
Importantly, the mother must return to work while still entitled to statutory maternity/adoption pay, or maternity allowance. Some of that entitlement must remain outstanding, however there can be a gap between her return and the start of the father's APL.
In addition, APL cannot be taken until the child is at least 20 weeks old, or the adopted child has been placed for 20 weeks.
The father must have been continuously employed by the same employer for 26 weeks, ending with the Expected Week of Childbirth (EWC) - and have remained continuously employed from then until the start of his APL.
To be eligible for Additional Paternity Pay (APP), the father's earnings must be on average at least equal to the lower statutory earnings limit during the eight weeks prior to the EWC. This is currently ??97 per week.
What is the process?
It's essentially a process of self-certification by employees, which involves the following:
The father must give no less than eight weeks' notice of his intention to take APL, confirming the mother's EWC, the child's date of birth or anticipated placement date; and the dates of the APL period.
At the same time, the father must also provide an "Employee Declaration" confirming that the purpose of his APL is to care for his child and that besides the mother; he has main responsibility for the child.
The father must also provide a "Mother's Declaration" completed by her, confirming when she is returning from maternity leave and that he has the status asserted in his Employee Declaration - i.e. he is the father and has responsibility for the child.
Employers are able to request a copy of the birth or adoption certificate, as well as contact details for the mother's employer to try to verify that the information provided is correct, but this is not built into the process and employers will have to ask.
Impact and risk analysis
Although the self-certification process is intended to limit administration costs for the employer, there are concerns about the potential for fraudulent applications for time off. HMRC are going to carry out compliance spot-checks and will have power to impose financial penalties on both employers and employees for non-compliance. In any event it is hoped that the vast majority of employees won't consider trying to made a fraudulent application anyway, not least as the employer can write to the mother's employer to verify information.
The right for fathers to take APL will undoubtedly create direct costs for employers - especially in relation to providing cover for fathers who take long periods of APL. The Government's position is that the impact should eventually be neutral, as costs are evened out by the savings made by mothers returning early from maternity leave. However this analysis does not take account of the fact that despite equal pay legislation being in place since 1970 - women are often paid less and/or in lower paid roles.
Employers with enhanced maternity schemes will also have to either extend these to cover fathers taking APL (which will create further cost) or revise their schemes to lower the level of benefit offered to both parents. This is because a failure to provide the same Benefits to fathers taking leave to look after their babies will be directly discriminatory against them on grounds of their sex.
Reaction from employers
We recently undertook a survey of employers to canvas opinion on APL:
Considerable concern was expressed despite the fact that a large proportion of employers do not expect significant take-up. 82% of employers surveyed stated that the APL regime caused them concern. However at the same time, the responses identified that presently few eligible employees are taking any paternity leave pursuant to their existing rights; 64% of respondents indicated that less than a quarter of fathers in their organisations currently took any leave.
In relation to the new rights, 74% believed that less than a quarter of eligible employees would take APL. Where it is taken, 53% of respondents believe that fathers will take less than one month, while a further 43% believe they will would take no more than between one and three months. Only 2% of respondents expect any of their employees to take the maximum six months available.
Concerns about APLWe asked respondents to list their concerns about APL. These were:
Cost of providing cover (35%)
Possibility of too many employees being absent (8%)
Administration costs (2%)
All of the above (48%)
This confirms employers' concerns that the introduction of APL is going to lead to further costs to business; irrespective of whether or not there is a large take up. 62% of respondents to our survey stated that they believed introducing APL was misguided given the current recession.
The self-certification process for the father concerned 76% of respondents, while 94% of respondents indicated they would prefer to be provided with information from the mother's employer and a copy of the birth/adoption certificate automatically. HMRC's compliance spot-checks do not seem to sufficiently reassure employers.
On a more positive note, 30% of respondents believed a benefit would be that mothers would return to work earlier and 42% also believed that greater flexibility in respect of childcare was advantageous to their organisation. However, 49% saw no benefit whatsoever to their organisations, which clearly shows that many employers remain strongly opposed to APL.
Guidance for employers
Carefully tailored policies can eliminate many areas of concern. For example employers can build in that the mother's employer details must always be provided and that as a matter of standard practice they will write to verify information.
Updated policies will need to be re-drafted in time for implementation of APL in April 2011. Employers who recognise trade unions or who have employee representative bodies should re-draft their policies as soon as possible to allow sufficient time for consultation.
While APL is still a year away, employer opinion is divided and significant concerns remain. We will have to wait and see how many fathers take up their right to APL and what the cost and impact to employers ultimately is.
Watch this space.