Government unveils new family-friendlyemployment legislation

In October 2005, the UK government published its Work and Families Bill, which will enable ministers to introduce a range of new 'family-friendly' employment rights. These include longer paid maternity leave, paid paternity leave for fathers if the mother returns to work before the end of her maternity leave period, and a new right for carers to request flexible working.

On 19 October 2005, the government unveiled the Work and Families Bill, which will provide the basis for 'new measures to help all working families balance busy home and work lives'. Its provisions are based on policy commitments included in the Labour Party’s 2005 election manifesto (UK0504110F and UK0506102N), and were the subject of public consultation earlier in the year (UK0507104F). The government published its response to the consultation at the same time as publishing the bill.

According to the trade and industry secretary Alan Johnson, the bill 'aims to create a modern framework of employment rights and responsibilities for employers and employees while minimising the impact on business'. Launching the bill, Mr Johnson said: 'Our consultation showed broad support for our family-friendly approach, but today’s bill also includes a number of measures to make it easier for businesses to deal with employees taking time off.'

Key points of the bill

The bill’s main purposes are to:

• extend the maximum period for which statutory maternity pay, maternity allowance and statutory adoption pay are payable from 26 weeks to 52 weeks. Initially, regulations will extend this to nine months from April 2007, with the ambition of moving to a year by the end of the Parliament;

• enable the government to introduce a new entitlement to fathers to take paternity leave to care for a child and to receive statutory pay if the mother returns to work before the end of her maternity leave period;

• widen the scope of the existing law on flexible working (UK0304104F) to enable more people with caring responsibilities to request to work flexibly. The government intends that carers of elderly or sick relatives should be able to request flexible working from April 2007;

• enable the government to increase the maximum weekly amount payable for compensation payments in redundancy, unfair dismissal and insolvency; and

• enable the government to make regulations governing workers’ statutory annual leave entitlement. The government intends to specify that bank holidays are additional to the statutory annual leave entitlement.

Other provisions include:

• measures to help businesses manage the administration of statutory maternity pay, statutory paternity pay and statutory adoption pay;

• introducing 'keeping in touch days' so that, where employees and employers agree, a women on maternity leave can go into work for a few days, without losing her right to maternity leave or a week’s statutory pay;

• extending the period of notice for return from maternity leave to two months enabling employees and employers to plan more effectively for return to work; and

• making clear in the regulations that employers can make reasonable contact with their employees on maternity leave to help employers plan and ease the mother’s return to work.

On the issue of paternity leave, employed fathers already have the statutory right to two weeks’ paid paternity leave (UK0210103F). The government consulted on a proposal to allow a mother to transfer some of her maternity leave and pay to the father. In the light of comments received during the consultation, the government’s aim is to enable either the mother or the father to be off work to care for their child in the first year. It is intended that an employed father’s entitlement to additional paternity leave and pay will be dependent upon the mother returning to work. Fathers will be entitled to a maximum of 26 weeks’ leave, enabling them to take leave in the second half of the maternity leave period. Some of this leave could be paid if the mother was entitled to statutory maternity pay or maternity allowance.

Employer and union responses

Reacting to the publication of the Work and Families Bill, the Confederation of British Industry (CBI) said that businesses were willing to support the government’s plans to extend maternity and flexible working rights but the government underestimated the impact the legislation was likely to have on smaller firms.

CBI deputy director-general John Cridland commented: 'Employers will at least welcome the increase of the 'return to work' notice period, the proposed 'stay in touch' days and simplification to maternity rules - although many will see this as falling well short of the significant simplification they were hoping for'. The CBI supported the government’s decision to extend the right to request flexible working gradually and welcomed its extension to carers, provided that the term 'carer' was properly defined. But the CBI expressed some concern at the implications of the government’s proposed approach to paternity leave which it believed 'could put real pressure on firms to pay occupational paternity pay'.

The plans were also given cautious approval by the Institute of Directors (IoD). IoD director-general Miles Templeman said: 'Allowing new parents to trade off their maternity and paternity leave will hopefully benefit employers. If the mother is the more highly skilled and productive parent and returns to work sooner than expected, while her partner cares for the child, many businesses will suffer less disruption than under the present arrangements.'

The Trades Union Congress (TUC) welcomed the measures in the bill. TUC general secretary Brendan Barber said: 'This bill is another significant step along the road to making work family friendly. It’s good news for today’s and tomorrow’s working parents. Many of its provisions have been won after long union campaigns.'

However, Mr Barber emphasised that '[the bill’s] measures, though very welcome, are not the end of the road. We look forward to seeing paid maternity leave extended to a year and the government needs to look more imaginatively at moves to help both mothers and fathers. Simply allowing parents to take their current right to unpaid parental leave by the day, instead of in minimum blocks of a week, could make a real difference. And letting parents take this unpaid leave when their children are older, rather than only when they are under five as is currently the case, would also be a great help.'

Commentary

The Work and Families Bill is the latest in a series of measures introduced by the Labour government with the aim of extending the rights of employees to take leave and seek flexible working in order to accommodate their parental and family responsibilities. Trade unions and other campaigning groups have been pressing for improvements in statutory provision in this area. However, the largely positive response from employers’ groups to the new legislation reflects the fact that the government is seeking to pursue its 'family-friendly' employment agenda in an 'employer-friendly' way - balancing new rights for employees with procedural and other changes designed to help employers manage the impact of staff absences and returns.

The CBI’s stance also reflects a recognition that the statutory right to request flexible working, in force since April 2003, has so far operated well from an employer point of view. The CBI’s 2005 employment trends survey (UK0510102F) showed that 90% of employers had managed to accommodate requests from parents with children under six to work more flexibly (55% were accepted formally, 20% informally and 15% resulted in a compromise, whereas 10% of requests were declined). Nevertheless, the proportion of companies (26%) reporting that the legislation had had a negative impact represented a significant increase on the previous year’s figure (11%). The CBI believes that this increase suggests it is becoming harder for employers to accommodate requests to work flexibly and underpins its view that the government must be cautious in extending the right to request flexible working to new groups of employees. (Mark Hall, IRRU)