Family-friendly options ­– but who will benefit the most?

With the General Election expected next year and the parties competing for votes it is no surprise that Patricia Hewitt, secretary of state for trade and industry, is proposing a new raft of employment rights with a family-friendly tinge (News, 5 October).

Few employers will object to extending the right to have a request for flexible work given serious consideration by an employer from parents of young children or employees caring for an elderly or disabled relative. Similarly, most employers will probably agree that bank holidays should not be counted as part of employees’ entitlement to their minimum of four weeks holiday.

The suggestion that women should have the option of transferring some of their paid leave to their partner is more problematic. Some employers might welcome this if it meant that female employees were able to return to work earlier.

Conversely, other employers might be inconvenienced by the temporary absence of male staff taking advantage of their partner’s paid leave. Clear guidelines will be crucial if this measure is introduced.

The Government is considering two other measures: increasing paid paternity leave from £102 a week to 90 per cent of earnings and increasing paid maternity leave from six months to a year.

These measures have two implications for businesses. First, this will add to the burden on affected businesses’ cashflow, because the employer is obliged to pay Statutory Maternity Pay (SMP) and Statutory Paternity Pay (SPP) up front and has to seek reimbursement from the Government later. Second, an increase in these rates of pay could result in more employees being away from work for longer periods of time. This can be disruptive, especially in small businesses. Employers cannot replace a valuable member of staff with a cry of “hey, presto”.

Unemployment is low, there is a strong competition for skilled staff and it is often difficult to find temporary staff cover.

Family-friendly policies must take the interests of business into consideration. Three measures would be beneficial. First, employers need greater certainty about whether an employee will be returning to work after being away on maternity leave. Second, the Government should pay SMP and SPP directly to employees – this would lighten the regulatory burden on employers. And third, some women might prefer six months paid maternity leave at a higher rate than extending the period of paid maternity leave to 12 months. They should have this choice.

Richard Wilson
Head of Business Policy
Institute of Directors

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