Shared parental leave: enhanced pay is key to take-up

Employers that enhance shared parental pay are twice as likely to receive shared parental leave requests as those who offer the statutory rate, according to research released today by XpertHR Benchmarking.

One employer in four either enhances shared parental pay above the statutory minimum or plans to over the coming year, according to research on the impact of shared parental leave in its first year. But over double this number – more than half of survey respondents – currently offer enhanced maternity pay.

Whether or not to enhance shared parental pay above the statutory minimum – a flat rate of £139.58 per week (or 90% of earnings if this is less) – was a key decision for employers when framing shared parental leave policies. This decision also has a direct impact on shared parental leave take-up levels, the survey suggests.

Employers have been far from overwhelmed by shared parental leave requests over the past year. Nearly three-quarters (72%) of the 397 employers surveyed said that, to the best of their awareness, some employees were eligible to make shared parental leave requests over the year to 5 April 2016. Eligible employees at one-third of these organisations requested shared parental leave over the year, with those in the public sector more likely to make requests than their private-sector counterparts.

Affordability concerns underpin low shared parental leave uptake

The actual number of eligible employees making shared parental leave requests per organisation over the past year was low. Among employers reporting that eligible employees had put in shared parental leave requests, half reported that only one eligible employee had made a request, 20% had two eligible employees requesting shared parental leave, and 25% had had between three and eight requests.

Employers believe that affordability is a key reason for the low uptake of shared parental leave. Only one in seven respondents agrees or strongly agrees with the proposition that “shared parental leave is seen as an affordable option by all eligible employees at my organisation.” More than one in three disagree or strongly disagree.

Employers that enhance shared parental pay are twice as likely to receive a shared parental leave request as those who offer only the statutory rate. The proportion of employers with eligible employees making shared parental leave requests rises from one-third across the whole sample to more than half of those offering enhanced shared parental pay. But it falls to only a quarter of employers that do not enhance shared parental pay.

“Most parents are unable to afford to take shared parental leave,” says one private-sector-services respondent. “It is a significant drop in pay if both parents take time off, but only receive the statutory pay. Shared parental leave only really supports the families who have strong financial backing.”

A number of employers that do not offer enhanced shared parental pay note that eligible fathers at their organisation had opted to take paid annual leave rather than shared parental leave. This was because statutory shared parental pay was pitched too low to present a viable option. “Shared parental leave does not offer any upgrade in pay for eligible male employees, so there is no uptake at all,” says one private-sector-services employer.

Shared parental leave fails to boost fathers’ caring roles

A key objective of shared parental leave was to “encourage more fathers to play a greater caring role in the first year, via longer, more flexible shared leave,” according to the Government’s 2013 impact assessment. Only one in 10 employers surveyed by XpertHR agrees or strongly agrees that the new right has been successful in achieving this objective. By contrast, three-fifths disagree or strongly disagree.

But shared parental leave has exceeded expectations in other areas. Where eligible employees did take shared parental leave, the amount taken was greater than that forecast by the Government.

Among employers providing data on the amount of shared parental leave taken over the year to 5 April 2016, the median was 12 weeks per employee and the average was 12.4 weeks. Both measures are above the Government’s 2013 estimates that the typical amount of shared parental leave taken was “unlikely to be the full 18 weeks, more likely one or two weeks.”

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Overall, employers strongly support shared parental leave in principle, the XpertHR survey finds – even if the new right is proving slow to take off in practice. “This is only the start in changing the culture towards one where each parent has equal rights responsibilities,” says one retail sector employer. “The policy will not be beneficial until the culture changes.”

The 2016 XpertHR Benchmarking survey on shared parental leave is based on responses from 397 employers with a combined workforce of 827,083 employees. XpertHR Benchmarking subscribers can access and drill down into the complete results data. This includes exclusive details of enhanced shared parental pay provision at around 50 organisations, and employers’ views on the proposed extension of shared parental leave to working grandparents by 2018.