More paternity leave for fathers

15 February 2010

A new rule will allow mothers to swap a substantial part of their maternity leave with the father. The government has confirmed that the planned change will come into force in April 2011.

At the moment the fathers of new babies can take two weeks' paid paternity leave. Under the new regulations, however, parents will have the option of dividing maternity leave between them. Fathers will be granted the legal right to take up the final three months of paid maternity leave due the mother provided she returns to work.

They would be paid the statutory maternity pay of £123.06 a week for the three-month period. They will also have the chance to take a further three months of unpaid leave, bringing the total amount of parental time-off for couples of newborn children to 12 months. The changes will apply to parents of children due on or after 3 April 2011.

Harriet Harman, the Women and Equalities Minister, said: "This gives families radically more choice and flexibility in how they balance work and care of children, and enables fathers to play a bigger part in bringing up their children.

"We've doubled maternity leave; doubled maternity pay; introduced paternity leave; more than doubled good quality affordable childcare places; and introduced right to request flexible working."

It is thought that between 4 per cent and 8 per cent of those eligible for the new leave will take it, but that only 1 per cent of small firms will be affected.

Katja Hall, the CBI's director of employment policy, commented: "Businesses do their best to support flexible working styles, and this step will give parents more room to adapt childcare to their own situation.

"We recognise the need for greater gender equality when it comes to childcare responsibilities, but the government must get these new rules right and not create a bureaucratic tangle."

But Stephen Alambritis of the Federation of Small Businesses argued that the new rules would hamper smaller employers: "Small businesses will want all hands to the pump, and having one out of workforce of four means a quarter of your staff being out of action."

Consultation ends over retirement age

The government's consultation into the future of the default retirement age of 65 has closed.

As things stand, employers can oblige workers to retire at 65 unless both parties agree otherwise. However, the government is looking at proposals to scrap the default retirement threshold and to give employees the right to continue working beyond 65.

Responding to the consultation, the Institute of Directors (IoD) said that the minimum retirement age should be raised to 68. The employers' group conceded that, with more people wanting to work past 65 because they are living longer, healthier lives, there is a need to review the UK's existing retirement framework.

But the IoD went on to warn that, while many people will be capable of doing their jobs past 65, it is important that the government recognises that this will not be possible for all employees in all types of job. Small firms, in particular, may find it impossible to redeploy older workers to suitable jobs.

For these reasons, many employers will continue to need the flexibility provided by the default retirement age, the IoD said. That still, however, leaves room for reform in the IoD's view. The automatic retirement age should be raised, initially, to 68 as this would enable people to work longer, while ensuring that employers retain the flexibility they need to manage their workforces.

Miles Templeman, director general of the IoD, commented: "In a highly competitive business environment no sensible employer wants to lose good staff just because they've reached a certain age.

"Equally, it is important that capable employees, who want to work longer, have the opportunity to do so. We think that the current system, where employees can work beyond the default retirement age with the agreement of their employers, is sound in principle and supports both parties."

Mr Templeman added: "However, it's important that the UK's retirement system evolves in line with modern working practices. On this basis we would support the default retirement age being raised initially to 68. This would allow people to work longer, while ensuring that employers retain the flexibility they need to manage their workforces."

Change could harm small firms
On the other hand, the Forum of Private Business (FPB), which represents smaller firms, argued that any change to the age at which people could be obliged to retire may damage the competitiveness of small employers.

For the FPB, many businesses are aware of aware of the skills and experience older workers can bring, but the business group also put the case that dropping the default retirement age would force business owners to keep on over-65s, whether they want to or not. This, the FPB believes, will prove a huge problem for thousands of small firms, hampering their abilities to plan for the future.

Phil Orford, the FPB's chief executive, said: "I don't think anyone would dispute the valuable contribution older workers make to the economy.

"However, at the moment, there is nothing to stop anyone from working beyond 65, providing it suits both parties. The current law works perfectly well, so why tamper with it?"

Mr Orford went on to say that abolishing the compulsory retirement threshold would have implications for employment law and could open the door to costly employment tribunal cases.

In its response to the consultation, the FPB said: "Most employees are certainly competent enough to work beyond the age of 65 without a significant deterioration in their abilities. However, for those employees not willing to leave voluntarily, there will eventually come a time when the needs of the business will have to be considered.

"In the absence of a default retirement age, the only viable option available to an employer is a capability dismissal based on the declining competence of the worker. We believe this would be an undignified and humiliating end to a career for most staff."

Agency worker rules may hinder job creation†

New regulations that will entitle temporary workers to many of the same employment rights as permanent staff have gone before Parliament.

The CBI criticised the legislation, which is designed to implement the EU's Agency Workers' Directive, as likely to hinder job creation and as going further in its reach than is actually required by EU rules.

Under the changes, for the first time agency workers will be entitled to equal treatment on basic working and employment conditions, including pay and holidays, as if they had been recruited directly by the hirer. The entitlement comes into effect after 12 weeks in a given job.

The rights on pay will apply not just to the basic hourly rate but to all pay for work done, including bonuses that are directly related to the performance of the agency worker personally. However, they will not extend to some of the wider benefits that permanent staff can enjoy such as occupational pensions and sick pay.

To combat avoidance of the new rules, the regulations include provisions that will deal with repeat assignments designed to prevent workers acquiring equal treatment rights. Agencies and hirers will face the prospect of having to pay out up to £5,000 to the worker if an Employment Tribunal finds that these specific anti-avoidance rules have been breached.

Other benefits will apply from the first day of an assignment. These include the right to information about internal vacancies, giving temporary workers the same opportunity as other workers to find permanent employment, and equal access to on-site facilities such as child care and transport services.

Business Minister, Pat McFadden said: "This change in the law is aimed at ensuring fairness for agency workers in relation to the permanent employees they work alongside."

Laying the regulations now means that the government will have the rules on the statute book before the end of this Parliament.

John Cridland, the CBI's deputy director general, said: "These regulations are bad news for the economy as they will hamper job creation. Employment agencies help over a million people find work and these proposals will make it more expensive for companies to use agency temps by increasing bureaucracy."

Mr Cridland added that the government has gone further than it needed to under EU rules by forcing employers to include temps in performance appraisals designed to set pay for employees.

He continued: "This extra bureaucracy will only discourage firms from taking on temporary workers when they're unable to create permanent jobs.

"Agency temps' employment relationship is with the employment agency, not the agency's client, and the law should recognise this. The economy would benefit from a much simpler definition of pay, giving agency workers equal treatment without the substantial burdens in the government's approach."

The employers' group, however, did welcome the decision to delay introducing the regulations until the end of next year, and the government's rejection of union demands for a much more heavy-handed approach to imposing the new rules.