February

Will Shared Parental Leave affect your business?

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Early last year, the rules on parental leave were changed to allow both parents to share time off work, which traditionally had been reserved for the mother. The success of Shared Parental Leave resulted in the Chancellor George Osbourne extending the rights to grandparents. It was another change in legislation to have implications on UK businesses, after the workplace pension reform and upcoming holiday pay changes.

The Chancellor had this to say:

"Research shows two million grandparents have either given up a job, reduced their hours or taken time off work to look after their grandchildren. Allowing them instead to share leave with their children will keep thousands more in the workplace, which is good for our economy."

What is Shared Parental Leave?

Most couples who are in paid employment and raising a child together can share 50 weeks of leave following the birth or adoption of the child.

Parents can take leave in their child's first year at different times, or double up by taking leave at the same time. The rights apply to parents in work, including those who are adopting, same-sex couples, co-habiting couples, and couples bringing up a child together even if the baby is from a previous relationship. Parents can use their leave anytime within the child’s first year, as Shared Parental Leave does not have to be taken all in one go.

Additionally, fathers are still entitled to two weeks off work as part of their paternity leave.

Eligibility

In order to qualify to take Shared Parental Leave, one parent must have been an employee with at least 26 weeks of service with the same employer by the end of the 15th week before the baby is due, or when matched with an adopted child. The other parent must have worked for at least 26 weeks in the 66 weeks leading up to the due date and have earned at least £30 a week in 13 of the 66 weeks.

Salary Implications

Shared Parental Leave is set at £139.58 per week, or 90% of an employee’s average weekly earnings, whichever is lower. However, whilst businesses cannot offer less than this, employers are within their rights to offer more if they wish.

Shared Parental Leave is only paid for 37 weeks, the remaining 13 weeks of the 50 are unpaid.

If your business is looking for a payroll software solution which is fully legislation-compliant, IRIS can provide it. Alternatively, why not use IRIS Managed Payroll and outsource your payroll to IRIS and take away the hassle and responsibility? We offer a comprehensive outsourcing service that's compliant with the latest legislation, such as RTI, auto enrolment, and Shared Parental Leave. We offer both fully managed and tailored services which look after all aspects of your payroll leaving you free to concentrate on your business.

Read our latest case study from Aldens, a customer of IRIS Managed Payroll, or try our payroll outsourcing calculator and see how much your business could save.

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Posted by
Christopher Eden
25 February 2016
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