Offering enhanced family pay has well-documented benefits in terms of retention, employee well-being, employee engagement and also recruitment. Enhancing longer maternity, adoption and shared parental leaves can be difficult for small businesses, so many stick to statutory minimum entitlements.
But what about paternity leave? Could you, should you enhance paternity pay, and is there anything to consider when doing so?
Paternity leave is a maximum of two weeks, and finding some extra pay for two weeks is naturally easier for a small business. It’s an absence that is easier to cover without having to employ someone else and incur double benefits/holiday costs. Covering longer family leave is usually necessary as you often can’t manage without someone for several months, but pushing work off or having colleagues cover it for a week or two is easier – like someone being off sick.
And it’s probably less common – every pregnant employee will take some form of maternity leave, sometimes the compulsory two (or four, in a factory setting) weeks, but usually more. But not all fathers/partners take paternity leave.
Facilitates leave where it otherwise might not be taken
Many small business owners might also want to enhance it because of the fact that still in the majority of families, however wrong it might be, fathers are more likely to earn more and be the ‘main breadwinner’, therefore might feel less able to drop their pay, even for only two weeks.
It shouldn’t be that way, but it is still the case, and if enhancing pay encourages more fathers/partners to take time off, that is in itself a good thing. It normalises it as a concept.
- Is not enhancing maternity pay a problem?
Many small businesses struggle to offer enhanced maternity pay, and instead offer statutory minimum only, on the basis that with a long period of having to provide contractual benefits to women on maternity leave, and accrued holiday, they can’t afford to increase the financial burden of maternity leave. But may feel able to enhance two weeks’ paternity pay.
But is this a problem? Is there a risk of a discrimination claim if the same employer enhances paternity pay but only offers statutory minimum maternity pay?
The question of comparison between two different types of leave and whether offering different pay was discriminatory has arisen before, in relation to shared parental pay as compared to maternity pay, and whether offering enhanced maternity provision but not shared parental provision was unlawful.
The outcome was that it is not discriminatory, mainly on the basis that the reasons for maternity leave and shared parental leave, and the provisions, are materially different, maternity leave being for the dual purpose of recovery from birth as well as care of the child.
The case law isn’t directly comparable of course, and there doesn’t seem to have been anything specifically exploring the issue of enhancing paternity pay but not maternity pay. A woman bringing a claim on the basis of no enhanced maternity offering may well struggle because of comparators and the provisions being so different, so it doesn’t seem like much of a risk.
However, even if you can only enhance maternity pay a little bit, the perception of the employer being family friendly and therefore enhancing all provisions rather than just paternity leave, may well bring a much higher benefit to your bottom line than the limited costs of a few weeks at full pay.
Particularly when maternity pay is 90% pay for the first six weeks anyway, so whilst the risk is low, the cost/benefit balance of enhancing maternity pay for an additional 10% for a short period seems to suggest it would be worthwhile.
If you’d like some guidance on enhancement options for family leave pay, or on supporting fathers and partners taking paternity leave, do get in touch.