I recently commissioned some research from the excellent Consultants at Ignite People Solutionshttps://www.ignitepeoplesolutions.co.uk/ into this for a client and the result have been rather interesting so I thought I would share here too.
Please do feel free to use this to improve your own offering perhaps and if you would like a drafted policy I have one ready and waiting - so do let me know.
Background research
(sources: XpertHR survey 2021 / Moore Pay 2022 / Employee Benefits published papers October 2021 and February 2022)
Enhanced Maternity Pay
Enhanced Maternity Pay is offered by almost two thirds of UK Organisations. The percentage of those within the private sector offering EMP was reported as 65.5% in 2021 but new data from February 2022 shows this is increasing with a latest figure of 74.1%.
There are three main forms that the EMP takes:
1. The majority of Organisations offer full pay for more than 6 weeks, 12 / 13 weeks is the norm followed by standard rate SMP.
2. Full pay for more than 6 weeks, 12/13 weeks then reverting to 13 weeks at half pay followed by standard rate SMP.
3. 6 weeks at full pay followed by 33 weeks at standard rate SMP.
QUALIFYING SERVICE
Most Organisations have a qualifying period of service ranging from 6 months to 12 months before employees are eligible to apply for EMP. The date at which this is calculated can vary. It could be completing 6 months / one years service by the end of the 15th week before the baby is born (the “Qualifying Week”) or by the expected week of childbirth (“EWC”)
CLAWBACK PROVISIONS
There can be a clawback clause. This ranges from a minimum length of time an employee must return to the business before no repayment is required, to a sliding scale of repayments depending on the period of time the employee has been back in the workplace.
In some cases, the policy allows for the employee to determine when they would like the EMP paid. This could be paid on a monthly basis or as a lump sum upon the employee’s return to the business, in that way, should the employee not return, there is no clawback of the EMP required.
BENEFITs
It is becoming more common to offer benefits to employees returning from maternity leave, aside from their legal right to request flexible working under a formal arrangement. This can take the form of a phased return to the workplace and, following the events of the past two years, forms of hybrid working.
Also, those returning are also being supported in the workplace by coaching / training / mentoring support, particularly where they may have been out of the business for the whole 52 weeks (these Organisations are those who tend to utilise, with their employee’s agreement, the 10 KIT days to ensure employees are kept up to date with developments while they are on leave).
Some return to work bonuses are being offered but these are linked to a set return period and are less favoured options.
The pros for offering EMP are:
· Boosting employee engagement
· Concern for employee wellbeing
· Recruitment / Retention
BENCHMARKING
There are some Organisational EMP policies published online which give an indication of the different forms that EMP can take. I have also included two from my own knowledge but these need to remain anonymous. One is a professional services company (P1) and another is a SME working in the software field (P2).
For both companies, P1 and P2, enhanced adoption leave is paid on the same basis as enhanced maternity leave with the same eligibility and clawback provisions. Research also backs up enhanced adoption policies being formatted in this way.
ENHANCED PATERNITY LEAVE
Research shows that this is offered by 61.5% of those Organisations within the private sector.
Of this 61.5%, three quarters pay either full pay for the entire period of paternity leave or full pay for the first week and SPP for the second week.
Eligibility criteria usually includes length of service of either 6 or 12 months. There appears to be no clawback provisions.
However, there is an increase in Organisations being flexible in how the leave is taken and not being so rigid with the blocks of one week rather than taking odd days, especially where they are paying full pay for the period.
SHARED PARENTAL LEAVE
Despite its introduction in 2015, there is not a huge take up within Organisations, approximately 4 in 10 responded that they had had requests for this. Reasons cited for this are:
· Affordability/Pay
· Complexity of the process
· Attitude and culture in the Organisation
Of those Organisations that reported a take up of Shared Parental Leave, only a quarter of those made enhanced payments and these were typically larger Organisations of 1,000+ employees. Where offered in these circumstances, it was noted that the enhanced shared parental pay matched enhanced maternity pay. This resulted in a higher take up by employees.
NOTE
If not included in contracts already, consideration should be given to a contract amendment to include reference to enhanced maternity pay (and enhanced paternity and shared parental leave pay) to state that it is a form of paid leave and the Organisation can amend or withdraw the enhanced pay at any time.
Employees should also be asked for their written confirmation, perhaps on the application form, that they are aware of and agree to any clawback provisions.