Green paper on parental leave receives mixed reception

In December 2000, the UK government published consultative proposals for the reform of parental leave arrangements. Employers' groups expressed concern at the prospect of further legislative intervention while trade unions and other campaign groups gave the proposals a generally positive reception.

On 7 December 2000, the Department of Trade and Industry (DTI) published a green paper entitled Work and parents: competitiveness and choice, setting out a range of options for helping working parents balance their family and work responsibilities. Its proposals are currently the subject of a three-month period of public consultation, after which ministers will decide which options to take forward.

The publication of the green paper is the latest step in a major ministerial review of parental leave provision (UK0010194F) aimed at boosting the participation of mothers in the labour market and also responding to dissatisfaction expressed by trade unions, other campaign groups and some Labour Party MP s over the parental leave legislation introduced in December 1999 (UK9912144F). The proposals eventually agreed are expected to be included in the ruling Labour Party's manifesto for the forthcoming general election, expected by May 2001.

Key points of the green paper

In a foreword to the green paper, trade and industry secretary Stephen Byers writes: "The government wants to make it easier for parents who choose to work to do so ... This green paper seeks views on a number of practical measures to help working parents. It also recognises that businesses, particularly small employers, need to minimise extra costs. We need to find ways of helping parents and helping business at the same time."

Options set out in the green paper include:

  • extending unpaid maternity leave so that a woman could stay at home for a year;
  • allowing mothers and fathers to split any increase in existing unpaid maternity leave entitlement between them;
  • increasing the flat rate of maternity pay during the existing period;
  • lengthening the period for which maternity leave is paid to six months;
  • seeing if the eligibility criteria for maternity pay could be widened; and
  • introducing two weeks' paid paternity leave for fathers.

A number of options focus on promoting flexible working, which the green paper says could be done either through legislation or incentives to business. These include:

  • giving mothers who return early from maternity leave the right to work reduced hours for the rest of that time;
  • giving fathers the right to work reduced hours until the end of maternity leave; and
  • allowing both parents the right to opt to work reduced hours for as long as they wish, when the maternity leave period ends.

However, the green paper also says that such rights could be balanced by exempting employers with a certain number of employees from having to agree to requests to work reduced hours, except by mothers for a short time, and giving all employers the right to refuse a request to work reduced hours if it would harm the business.

Significantly, the green paper records that the possibility of introducing paid parental leave has been raised a number of times in earlier consultations and invites views on its introduction, but notes that the costs would be "considerable" for both employers and the state.

The DTI invited responses to the green paper by 7 March 2001.

Initial reaction to the proposals

In a statement, the Confederation of British Industry (CBI) said that the government had gone some way to easing business fears about new measures to support working parents but that "concerns still remain". CBI deputy director-general John Cridland said that flexible employment practice needed to be "encouraged not regulated". He said that proposals like paid paternity leave and extended maternity leave would receive a "mixed reaction" from business: "Larger firms have resources to cover the extra absence and costs, but lots of smaller firms would struggle. Many will be disappointed at the continuing push for more legislation when they are still absorbing the laws recently put on the statute book." Mr Cridland said that companies would be most concerned about the possibility of being required to offer part-time work to full-time employees after they have had a child. He saw this as "unworkable and unnecessary".

The Engineering Employers' Federation (EEF) responded in similar vein. The EEF said that employers would inevitably be concerned about any further regulatory burdens being imposed on business, and urged the government to concentrate on disseminating "best practice" on flexible working rather than introducing "detailed regulations". The EEF is concerned that giving mothers and fathers a statutory right to return to work on a part-time basis "would have a detrimental effect on business efficiency and competitiveness". The Institute of Directors (IoD) also voiced concern over the green paper, arguing that "family-friendly" initiatives should be kept voluntary. The IoD said that further legislation could hamper business's competitiveness and warned of a risk of resentment on the part of childless employees at "special treatment" for working parents.

For the Trades Union Congress, general secretary John Monks welcomed the green paper and said that it "shows the government has been listening to Britain's working parents". He added: "Working parents need to be able to work flexibly if they are to juggle the needs of work and their children and stay sane, and we welcome the government's proposals to give new parents ways of reducing their hours. We applaud the proposal to give new fathers paid paternity leave. Good employers already give new dads time off. Now even the meanest should be forced to do the same. While we are disappointed not to see more progress on paid parental leave, there is no doubt that the green paper is a substantial advance for working parents."

A statement from the Equal Opportunities Commission (EOC) said that "some of the new proposals could make a real difference to the lives of many working parents." The EOC highlighted in particular the proposals to allow a choice in which parent uses part of the maternity leave entitlement, a period of paid paternity leave and reduced working hours for both parents after the birth of a child. However, the EOC also expressed concern that "without paid parental leave and rates of maternity and paternity pay that are at or near parents' normal level of income ... many people will not be able to take advantage of the proposed new rights."

Commentary

Government spokespeople have indicated that the green paper is "very green", ie that the government is not strongly committed to the options outlined. The government has said that not all of the proposals in the green paper can be implemented, and that, over the three-month consultation period, it wants to hear from employees, employers and other interested groups on their top three priorities for action and their lowest three priorities. At the same time, it is clear that at least some concrete proposals will emerge: Stephen Byers has emphasised that "Simply doing nothing is not an option" and Labour Party strategists regard family-friendly employment policies as electorally popular. Although press comment perceived the green paper as "cautious" and "pragmatic", this has not prevented some vocal criticism from employers. The eventual outcome of the consultations will be a key test of the government's commitment to extending support for working parents while at the same time trying to avoid alienating business opinion – a vital constituency for "new Labour". (Mark Hall, IRRU)

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