Neonatal leave and pay

A new Employment Bill will legislate for a statutory right to up to 12 weeks’ paid time off work for parents of children who have spent at least a week in neonatal care.

In July 2019 the government published a consultation, Proposals to Support Families, a part of which canvassed the idea of introducing neonatal leave and pay. The budget saw confirmation that this would be going ahead and now the government has formally responded to the consultation.

While the government has confirmed that the forthcoming Employment Bill will legislate for neonatal leave and pay, there is, as yet, no timescale for its introduction. From the Budget costings it would appear that this won’t be operative until 2023-24, although this has not been confirmed.

Currently, parents of a baby in neonatal care must rely on their existing statutory leave entitlements to enable them to be off work while the baby is in hospital. The consultation asked for views on the design of this new entitlement; associated practical considerations; and the implications for employers and employees. Specifically, it asked about eligibility and qualifying conditions, the length of entitlement and when the entitlement can be taken, notice and evidence requirements, and employment protections and parents’ right to return to the same job.

The government’s approach is as follows:

  • Parents of babies who are admitted into hospital as a neonate (28 days old or less) will be eligible for neonatal leave and pay if the admission lasts for a continuous period of seven days or more.
  • As to which care givers should be entitled to neonatal leave and pay, the government intends consulting further before defining a ‘neonatal parent’.
  • Neonatal leave will be available to an employee from the first day of employment.
  • Entitlement to statutory neonatal pay will be available to those employees who have 26 weeks’ continuous service and earn more than the lower earnings limit.
  • Employers will reclaim the statutory payment from the government by reducing their NICs. Large employers will be able to reclaim 92% whilst small employers (those who have paid £45,000 or less in gross NICs the preceding tax year) will be able to recover 103%.
  • The total amount of statutory neonatal leave and pay available to parents will be capped at a maximum of 12 weeks.
  • Neonatal leave will be taken after maternity/paternity leave through prescribing a set period in which neonatal leave and pay must be taken.
  • Neonatal leave will normally be required to be taken in a continuous block of one or more weeks.
  • The notice requirements haven’t been finalised, but the intention is to take a two-tiered approach:
    • very short, informal, notice will be acceptable for neonatal leave taken very soon after the date of the neonate’s admission to hospital
    • a longer period of notice (one week) will be required where the neonatal leave begins at a stage where the child has not been recently admitted into neonatal care
  • Parents who qualify for neonatal leave will be afforded the same employment rights and protections as parents taking other relevant family-related leave, i.e. protection from detriment or discrimination arising from them taking, or seeking to take, neonatal leave.