Welcome to the next edition of Employment Law Matters, our quarterly update on key issues in employment law. Every three months, we will send you a selection of the most important developments for employers in case law and legislation, including practical takeaways for employers as well as things to look forward to in the coming months.
CM Murray LLP are leading specialist employment law advisers to multi-national companies and senior executives. If you have any topics you would like us to cover in our regular updates, please do get in touch.
Neonatal Care (Leave and Pay) Bill
On 24 March 2023, the Neonatal Care (Leave and Pay) Bill is due for its second reading at the House of Lords, which means that it may well become law this year.
The Private Member’s Bill (which has the backing of the Government) seeks to provide parents of children who require specialist additional care after birth with additional paid leave, which can be taken in addition to other leave entitlements such as maternity, paternity, adoption and shared parental leave. It aims to provide flexibility for parents where a baby is born unwell (or becomes unwell soon after birth) in order to alleviate stress in those very difficult circumstances. It also provides a framework within which employers can support their employees at a stressful time.
As the Bill’s name suggests, if introduced, the law will provide employees with two separate entitlements: Neonatal Care Leave and Neonatal Care Pay. The overarching condition for employees to be eligible for these entitlements is that neonatal care must be required for any reason within 28 days after the child’s birth and must continue for at least 7 full days.
Employees will be entitled to take the leave from day one of their employment. The leave (minimum one week) must be taken before the end of a period of at least 68 weeks from the child’s birth. The parents taking the leave will benefit from all the same protections as are available during other family related leave.
Employees will be eligible to receive Neonatal Care Pay provided that they have at least 26 weeks of continuous service before the start of the neonatal care, and their weekly earnings are at or above the lower earnings limit. The payments will be made by an employer directly to their employee, and can be reclaimed from the Government. The weekly statutory rates of Neonatal Care Pay are yet to be determined. The minimum payment that can be claimed is one week, and the maximum will be up to 12 weeks for each parent.
What next for the 4-Day Working Week?
The UK launched the world’s largest 4-day working week pilot on 6 June 2022, with 70 UK companies taking part over a 6-month period. The workers taking part agreed to deliver 100% of their usual 5-day output while working 80% of their usual hours without taking any reduction in pay. The pilot was promoted by not-for-profit organisation, 4 Day Week Global, and overseen by Autonomy, an independent progressive research organisation.
Prior to the commencement of the pilot, the key areas of interest included whether, owing to the reduced working hours, the participants would benefit from positive affects to their mental health and work-life balance and whether the reduced working hours would have any consequential detrimental impact on their productivity.
The results from the pilot were published in February 2023 and were positive in favour of the 4-day working week, with companies rating their overall experience of the trials an average of 8.5/10. Of all participating organisations, 91% stated that they would definitely be continuing or are planning to continue implementing the 4-day working week.
As anticipated, there was a notable effect on the participants’ health and well-being, both physically and mentally. Participants reported that they spent more time exercising, experienced a decline in sleep problems and burnout, and there was a significant increase in job and general life satisfaction. Further to this, the number of sick days taken by the workers fell by about two-thirds. This indicates that adopting the 4-day working week could prove to be a key factor for employers for both talent retention and talent acquisition going forward.
There was not only a positive impact to the health and well-being of the participants but there was a reported 35% increase in revenue over the trial period when compared to similar periods of the previous year, indicating that there was an increase in productivity with the introduction of a shorter working week.
The positive results of the pilot have been well received and the 4-day working week could prove to be instrumental for the improvement of a work-life balance among staff. However, there is a realistic possibility that a 6-month trial period is not a sufficient period of time to identify the potential long-term impact of a 4-day working week and therefore we must approach the results with a degree of caution. The counter arguments include the fact that in order to maintain productivity over 4 days rather than 5, longer hours will need to be worked on those days, which may not suit those with childcare or other carer responsibilities and may increase stress and pressure on the days worked. The thorny question of how productivity is to be measured is also a difficult issue, especially in businesses where results are skills-based, rather than output based.
One of the distinguishing factors of the next decade will be which businesses interpret and implement flexible working requirements in a way that attracts and retains the best talent, year after year. Currently the trend is to look to individualised plans for workers at different stages of their careers. Given the pressure on finances caused by higher inflation and the consequent increase in the cost of daily living, a full-time 4 day week may be a cogent solution for many.
The Positive Parenting Alliance Divorce and Separation Initiative
The Positive Parenting Alliance (PPA) divorce and separation initiative formally launched on 26 January 2023. The PPA introduced this initiative in response to research which published details of the effect and impact that divorce/separation can have on workers’ productivity, wellbeing, and commitment to work. The statistics from the January 2023 study that prompted this initiative are as follows:
- 95% said that their separation had negatively affected their mental health in the workplace;
- 39% said that they had taken time off from their work because of their separation;
- 12% stopped working altogether because of their separation.
However, this is not the only study to reach this conclusion. In a study from 2021, research found that when divorcing/separating, employees will go through a stage of ‘divorce grief’ during which employers were failing to provide sufficient support, resulting in a negative impact to productivity or even employees leaving the company altogether.
The PPA is encouraging employers to partake in this initiative to better support their employee’s wellbeing while also ensuring that employees remain working efficiently. The initiative requests that employers commit to four changes:
- Recognise separation as a ‘life event” in HR policy so that those experiencing separation feel recognised and realise they can access support;
- Ensure parents going through separation have access to flexible working to enable them to manage school and childcare pick-ups and drop-offs while they reconfigure their family set ups;
- Giving employees access to, and pointing them towards, emotional counselling;
- Signposting and access to separation support services so that parents can have the guidance and support that they need to separate in the most compassionate and child-focussed way.
The PPA have announced that they will provide guidance on policies and practical help for employers who wish to adopt this scheme. Companies such as Tesco, Unilever and PwC have already signed up to the initiative. We have also seen the first law firms sign up to this initiative with Payne Hicks Beach, Boyes Turner, Mills & Reeve and Laura Devine signing up in an attempt to enhance the positive cultures within their workforces.
Such policies also support the fundamental human right to respect for privacy and family life under Article 8. Indeed, in a number of cases the ECHR has determined the following principles, namely
- That regard for family unity and for family reunification in the event of separation are inherent considerations in the right to respect for family life under Article 8;
- The mutual enjoyment by parent and child of each other’s company constitutes a fundamental element of family life within the meaning of Article 8 of the Convention (even if the relationship between the parents has broken down).
As companies look for ways to stand out as a good employer and cut down the number of days lost to work as a result of a traumatic life event, serious consideration of the PPA’s initiative makes good sense.
News in Brief
The UK government is considering a proposal to increase the number of hours which international students may work. Currently capped at 20 hours per week, ministers are considering increasing the cap to 30 hours per week, or even removing it completely. Government sources have said the measure is one of many being considered, with a view to encouraging students to take more part-time jobs to address shortages in areas such as retail and hospitality. It remains to be seen whether the government will reach a consensus on the issue, a matter sure to be complicated by the fact that Suella Braverman has committed to reducing the number of foreign students, in order to meet the government’s pledge to reduce overall migration. Advocates of the proposal have pointed to Canada and Australia, both of which scrapped the limit of the hours which foreign students could work in 2022, in order to help address labour shortages.
Employers’ duty to protect employees from harassment by third parties?
The government is backing new harassment laws which would significantly expand employers’ liability for the harassment of their employees by clients, customers and other third parties. If the Worker Protection (Amendment of Equality Act 2010) Bill is passed in its current form, staff who are harassed by third parties will be able to bring harassment claims against their employer. The proposed re-introduction of liability for third party harassment would go further than the previous provisions from the Equality Act 2010, which were repealed in 2013. Whereas previously employers could only be liable if there had been at least 2 prior instances of third-party harassment of which they were aware, the Bill provides that employers will be liable if they have failed to take reasonably practicable steps to prevent the harassment, even if it is the first occasion.The Bill would also amend the Equality Act 2010 to introduce a mandatory duty on employers to take all reasonable steps to prevent sexual harassment of workers “in the course of their employment”. The Bill provides that, where an individual succeeds in a claim of sexual harassment against their employer, the employment tribunal must consider whether there has been a breach of the employer’s duty to prevent sexual harassment; if so, the employment tribunal will have discretion to award a compensation uplift of up to 25%.
If you would like to discuss any of the topics covered in this update in more detail, please contact Partners Merrill April or David Fisher, both of whom specialise in employment and partnership law issues for multinational employers, senior executives, partnerships, LLPs, partners and LLP members.