From 5 April 2015, new employment legislation allows parents to Shared Parental Leave (SPL) and pay following the birth or adoption of a child, therefore increasing fathers’ rights.
Employed parents who take SPL will be eligible for a new statutory payment, shared parental pay (ShPP). Self-employed parents will not be entitled to ShPP, but if they satisfy certain earnings criteria, their employed partner may be entitled.
ShPP will apply where:
The government has published guidance in order to clarify entitlement for SPL and ShPP. Please note that the answers to the following questions are accurate in respect to births but may vary for adopters
Broadly speaking, anyone who is eligible for SPL should be eligible for ShPP (subject to completing the relevant paperwork) if they have normal weekly earnings of at least the lower earnings threshold for national insurance contributions. Anyone who has qualified for Statutory Maternity Pay (SMP), Statutory Adoption Pay (SAP) or Statutory Paternity Pay (SAP) will have met this test.
There will also be people who do not qualify for SPL because they are not employees (such as agency workers), but who may qualify for ShPP because it includes anyone who is an “employed earner” for National Insurance purposes.
ShPP can only be claimed by a parent who is (or has been) in “employed earners employment” for 26 weeks at the relevant qualification date, provided the other parent also meets certain criteria as to their economic activity.
To satisfy the continuity of employment and normal weekly earning conditions, a parent wishing to claim ShPP must:
No, in order for a parent to qualify for ShPP, their partner must satisfy certain conditions relating to employment and earnings which they will do if:
Practically speaking parents have a total ShPP entitlement of 37 weeks less any weeks (or part of a week) in which the mother received or will receive SMP or MA before curtailing her SMP or MA period. This because mothers must take two weeks’ compulsory maternity leave, for which they will receive SMP or MA.
Assuming both parents qualify for ShPP, they will be able to choose how to divide the ShPP entitlement between them and must notify both their employers of this in writing.
So if a mother takes six weeks’ maternity leave and during those weeks is paid SMP, there will be 33 weeks of ShPP left for the parents to share between them.
For either parent to participate in the ShPP scheme, the mother must either have returned to work or curtailed her pay or allowance period. There are also complicated requirements to provide notice and evidence that are almost identical to those required for shared parental leave. These are set in more detail in the Acas practice guide.
The difference between SMP and ShPP is therefore that the latter is capped at a statutory amount for every week for which a parent claims ShPP, while SMP is payable at 90% of actual salary (with no cap) for the first six weeks of maternity leave. This means that most mothers will take maternity leave and pay for at least six weeks so as to take advantage of the higher rate.
ShPP is paid by the employer of the parent taking the leave but you can recover at least 92% from the government.
There is no statutory requirement to enhance ShPP and the government considers that there is no need for employers to do so. However some employers are choosing to match their maternity terms. Having unequal pay rights may be a type of discrimination and there may be legal challenges at employment tribunals that force more employers to.
Our specialist solicitors advise on best practice with regards to Shared Parental Pay. This includes advice to ensure equality in the workplace and avoidance of any discriminatory practice. We can provide Shared Parental Pay policies for birth and adoptive parents.