Draft legislation to extend maternity leave to 20 weeks on full pay has been passed by a European Parliament committee.
The women’s rights committee voted in favour of extending maternity leave provisions through the Pregnant Workers Directive.
Current European laws give pregnant women 14 weeks fully paid leave, while in the UK women are given a year off with the first six weeks on 90% pay followed by 33 weeks on statutory maternity pay of £123 a week.
The new proposals – effectively trebling maternity pay in the UK – mean businesses could be faced with a £2bn burden, the Daily Mail has reported.
Although the government currently reimburses firms for the bulk of statutory maternity pay, business leaders said the scale of the increase could see companies ordered to shoulder more of the burden.
A spokesman for the Institute of Directors said: “The directive is a massive worry to us. We estimate that the UK will be hit with a bill of £1.5bn to £2bn a year – a very substantial cost.
“Given the state of the public finances, there has to be a strong risk that employers would end up being forced to pay.”
Employment relations minister Lord Young said: “We already have a generous system that is better than many European Union countries and works well, balancing the needs of businesses and workers.
“A substantial increase in maternity leave paid at full or near-full pay risks undermining this delicate balance at a time when economies across the EU can least afford it.”
The proposed legislation also sparked concerns that employers could discriminate against women of child-bearing age because of the increased costs of their potential maternity leave.
Marina Yannakoudakis, a Conservative spokeswoman on women’s issues in the European Parliament, said: “Small business owners with only a handful of staff are struggling to meet payroll costs already, without the EU forcing them to pay a member of staff for five months without a day’s work.”