A Guide to Shared Parental Leave in the UK
Flexibility and choice are crucial in supporting new parents in the workforce, which is where Shared Parental Leave (SPL) comes in.
The scheme allows working parents in the UK to share up to 50 weeks of leave between them during the first 12 months of their child’s life (or adoption if placed with their family). In addition to this, it also entitles them to up to 37 weeks of paid leave, which they can share between them.
But SPL can get a little confusing, especially where partners share leave. In this guide to Shared Parental Leave for employers, we demystify SPL, taking you through what makes parents eligible and how your organisation should set up its own Shared Parental Leave policy (SHPL). We’ll also cover how to treat this through your payroll, with a few tips on how to make this easier.
What is Shared Parental Leave?
As mentioned at the start of this guide, Shared Parental Leave is all about giving workers more flexibility and ‘wiggle’ room as they adjust to parenthood. Specifically, SPL offers both parents more choice in how they can take their leave in the first year after their child is born or adopted. It also applies to getting a parental order when a child is had through surrogacy.
So, how does Shared Parental Leave work? Well, if both parents are eligible, then they can have up to:
50 weeks of Shared Parental Leave - to manage care for their new child(s); they can take this how they like, and
37 weeks of Shared Parental Pay - based on maternity, paternity and adoption pay rates
Where the main partner is a mother and the other partner a father, the father is also entitled to paternity leave, so they’ll have an extra two weeks on top of all this to take as paid leave.
What if there’s more than one child?
It’s important to note that if parents have more than one child (e.g. in the case of twins or triplets), the same amount applies. In other words, they aren’t entitled to double or triple this amount. The same goes if more than one child is adopted as part of the same placement.
And how does Shared Parental Leave work?
As an example, SPL would allow both parents the choice to be at home together following the birth or adoption of the child. Alternatively, they could stagger this leave so that one parent is always home during the first year. They can take leave in blocks or take alternate weeks at home. Every family will have its own unique circumstances, which is why SPL is designed to give parents the option to take their leave however they like.
SPL is a statutory requirement. However, it’s a good idea to develop your own policy as an employer to provide even more flexibility on top of these statutory rules. Not only is this a great way to enhance employee wellbeing, but it also provides a wonderful boost to hiring incentives as part of your employee benefits package.
Who is eligible?
In order to qualify for Shared Parental Leave, an employee should share responsibility for a child with either their husband/wife, the child’s other parent, or their partner (who is living with them).
In order to get SPL they can share, at least one of the parents must be eligible for maternity or adoption leave and pay. In addition to this, they must:
Be employed at the start of their SPL
Have been working for at least 26 weeks before the relevant date, in the 66 weeks prior, and
Be earning a minimum of £30/week on average in any 13 weeks, again during this 66-week period
The qualifying parent(s) must also give their employer ample notice, including a declaration that their partner meets the statutory requirements around income and employment.
What happens if only one parent is eligible?
Now, there may be cases where only one parent is eligible, whether that’s because one of the parents is self-employed, isn’t working or hasn’t worked long enough; this can make getting SPL trickier. But if the non-eligible parent can still pass the requirements based on their income or employment, then both parents can still qualify for SPL.
In the case where parents would be jointly entitled, they can decide how to divide their leave once the parent/adopter has decided to curtail (or cut short) their maternity or adoption leave.
PayFit Top Tip:
As an employer, you’ll want to verify or check that your employee’s partner meets these income and earning requirements. You’ll also need their full name, as this will need to appear on the FPS. It’s also a good idea to include their National Insurance (NI) number here as well.
Maternity and Shared Parental Leave - how do they work together?
In order to take SPL and maternity leave together, the mother or adopter must cut short (better known as curtailing) their maternity or adoption entitlement before they’ve used their full 52 weeks statutory allowance. Once they’ve done this, they can move to Shared Parental Leave and essentially let their partner take a certain number of weeks at home.
Let’s say the mother/adopter stops their maternity leave at 31 weeks. Then, they can switch the remaining eight weeks to parental leave and pay instead.
All that being said, the first two weeks of maternity leave are always compulsory following birth, and that goes up to four weeks if a mother works in a factory.
What is Shared Parental Leave pay, and what are the rates?
In order to qualify for Shared Parental Leave pay, the main parent will need to meet requirements for maternity or adoption pay, whereas the other parent will need to meet those same requirements but for paternity pay.
The Shared Parental Leave rate is subject to change on an annual basis, along with other statutory rates, so it’s important to stay on top of this as a business (psst!, payroll software like PayFit makes this a cinch!).
For the 2023/2024 tax year, the Shared Parental Leave pay rate is the lower of either £172.48 per week or 90% of an employee’s average weekly earnings.
You might have noticed that the SPL rate is the same as Statutory Maternity Pay (SMP) and Statutory Adoption Pay (SAP), except that the first six weeks of both SMP and SAP are paid out at 90% of the employee’s salary. As an employer, you should pay SPL in the same way you’d pay other statutory payments (like Statutory Maternity and Paternity pay). But remember, you’ll need to account for National Insurance Contributions (NICs).
In other words, you’ll need to reclaim part of your NICs to reduce your HMRC liability. Doing it this way ensures your National Insurance Contributions due to HMRC at the end of the month will be reduced by a portion of the parental pay you pay your employees. That might be 92% or 103%, depending on your gross NI for the previous tax year.
How should employers go about creating a SPL policy?
At a minimum, your Shared Parental Leave policy must follow the statutory rules. However, you might decide as an organisation to provide additional occupational coverage on top of these requirements. Whether that takes the form of higher pay or more time off is up to you as the employer. And while not mandatory, additional occupational coverage offers a great opportunity to enhance your employees’ overall wellbeing.
Life as a new parent is wonderful but can come with lots of additional stressors that can challenge work/life balance. A strong Shared Parental Leave policy can help new working parents feel calmer and more cared for and, most importantly, allow them to enjoy those precious first few months with their new infant or child.
As with any workplace policy, your Shared Parental Leave policy should be clear and simple to follow and outline exactly what your organisation provides under SPL. It should also cover the process your employees need to follow to apply for this type of leave and their obligations under the law.
Some companies might treat Shared Parental Leave the same way they would maternity and adoption leave, which is a good way of simplifying these policies and ensuring parents are treated equitably.
Why it’s important to have a policy in place
With government-provided statutory leave, some companies may wonder why it’s even worth having a company-wide policy. There are several reasons why it’s important to have your own clearly outlined policy in place:
It ensures you’re getting the legal bits right
To start, it ensures you’ve covered from a legal standpoint. With a policy in place, both your HR personnel and employees have a set of rules they can follow, meaning they’re more likely to act on your policy and, at a minimum, ensure statutory requirements are respected.
For your employees, this provides greater transparency. For your HR team, this makes administering parental leave so much easier and smoother. It also lessens the hassle of disputes cropping up and aggrieved employees taking you to court (not nice for either party involved).
It shows you’re serious about employee wellbeing
Secondly, it shows you take your staff’s rights and happiness at work seriously. A fair and accommodating parental leave policy can also be a boon to your recruitment, retention and overall brand. If you’re seen as an employer that’s forward-thinking and family-focused and, most importantly, that follows through on this, you’re more likely to attract and keep top talent.
Perhaps the most important point of all is that your employee’s rights - both under statute and contract - are protected during the course of SPL. They are also bound by the terms and conditions of their employment contract. This means they can’t be subjected to unfair treatment or dismissal concerning their SPL. For instance, employees on SPL share the same rights as those on maternity leave if they’re being made redundant - they should be offered a different yet suitable role.
How is SPL administered from a leave perspective?
Planning is a big part of managing Shared Parental Leave. For one, the employee could decide to take alternate weeks, which makes it a challenge for managers to schedule in important projects and work assignments around the absent parent.
It's worth noting, too, that SPL allows the partner to take leave at the same time as the main parent. So where there's essentially 52 weeks maternity or adoption leave, then two weeks paternity, both parents could be off for 27 weeks at the same time. In the example where both employees work for the same company, this can have a bigger impact than expected.
How does PayFit support employers administering Shared Parental Leave?
Making Shared Parental Leave easier for HR teams and the staff they’re looking after is just one of the things we do to simplify payroll.
Through one of our handy templates, you can enter all the employee details you need to process SPL, including how many weeks they plan to take as well as their partner. We then take care of the rest!