knowledge | 26 April 2019 |
Paid Parental Leave on the Way
The Government in recent days has published the General Scheme of the Parental Leave and Benefit Bill 2019 (the “Bill”). The Bill includes provision for “parental benefit” in the first year of a child’s life and the Government intends to commence the scheme for such payments from November of this year. Parental benefit will be available for all new parents in employment or self-employment and will be paid by the State, in addition to existing maternity, paternity and adoptive leave entitlements. This initiative is the result of proposals developed by an interdepartmental working group regarding paid parental leave.
The Parental Leave Acts 1998 and 2006, in their current form, entitle parents of children up to eight years of age (or up to sixteen years of age if the child has a disability or long-term illness) to up to eighteen weeks of parental leave in respect of each child. The purpose of parental leave is to enable parents to provide for the care of their child. Generally speaking, a parent must be employed by his or her employer for one year before becoming entitled to parental leave. An employer may postpone the taking of parental leave for up to six months.
Both parents have an equal and separate entitlement to parental leave. Crucially, however, parents are not entitled to pay from their employer during the course of such leave, nor are they entitled to any social welfare payments equivalent to, for example, maternity or paternity benefit. Ireland is currently one of six EU member states that does not offer paid parental leave. All other employment law rights are preserved. Upon returning to work, parents may request a change in their work pattern or working hours, which employers must consider but are not obliged to grant.
Under the Bill, each parent may receive up to two weeks of parental benefit within 52 weeks of the birth of the child or in the case of an adoption, from the date of placement of the child. Parental benefit is paid to parents by the Department of Employment Affairs and Social Protection (the “Department”) at the same rate as maternity benefit and paternity benefit (currently €245 per week). Individual employers may decide if they wish to provide a ‘top-up’ payment to employees earning above this amount. The Government has indicated its intention to incrementally increase the period of paid parental leave from two weeks’ parental benefit to up to seven weeks’ parental benefit over the next three years. As parental benefit is non-transferable in nature, it is intended to incentivise fathers in particular to share parental responsibility and take time off work to care for their children.
The Bill also proposes to address a gap in the current law which prevents a male same-sex couple from receiving adoptive leave and benefit.
Parental Leave (Amendment) Bill 2017
Separately, the Parental Leave (Amendment) Bill 2017 (the “Amendment Bill”) is currently progressing through the Seanad. The Amendment Bill proposes to extend the parental leave entitlement to twenty six weeks (six months) in respect of each child. The Amendment Bill also proposes to increase the age of the child in respect of whom parental leave can be taken from eight years to twelve years.
The Bill is part of a Governmental initiative to facilitate flexible and balanced working lives and to encourage fathers in particular to share responsibility for the care of their children. Whether men avail of parental benefit remains to be seen, but given the level of parental benefit proposed in the Bill, the uptake of parental leave by men may be low, as has reportedly been the case with paternity benefit. Research from Eurostat in 2018 found that 90 per cent of fathers across the EU do not use parental leave entitlements, the major impediment being low rates of pay, as well as cultural norms and perceptions about gender child roles.
Although parental benefit will be paid by the Department, employers’ representatives have commented that the Bill will be burdensome for small and medium enterprises, for instance because of the absence of expertise, loss of productivity, recruitment and training costs and administration. This is likely to be heightened as the period of leave increases up to seven weeks by 2021.
However, the EU considers measures to support work-life balance as an essential factor in addressing the underrepresentation of women in the labour market. This view is reflected in the proposed directive on work-life balance which is progressing through the European legislative process. The objectives of the directive include improved work-life balance and an increased take-up of family-related leave and flexible working arrangements by men.
Although the Bill is at an early gestational stage as yet, approval has been granted by the Government for the priority drafting of the Bill. The Department has indicated that it is making logistical preparations to ensure that the parental benefit scheme can be operational from November. With parental leave becoming an increasingly attractive option for parents, employers may wish to make their own preparations.
Our Employment, Pensions and Incentives Group would be happy to address any questions employers may have on the implications of the proposed legislation. Your usual contact in McCann FitzGerald would be happy to provide for further information.
Also Contributed By: David McCauley
This briefing is for general guidance only and should not be regarded as a substitute for professional advice. Such advice should always be taken before acting on any of the matters discussed.