The Parental Leave (Amendment) Act 2019 was signed into law in May 2019. Employees in Ireland with children are now entitled to 22 weeks parental leave from 1 September 2019. It will then increase to 26 weeks from 1 September 2020 onwards. The recent change represents an increase of 4 weeks on the current parental leave entitlement of 18 weeks. The Act has also increased the maximum age of the child for whom parental leave can be taken from 8 years to 12 years. Employees who have taken their entitlement will now be eligible for a further period of parental leave if they have children under the qualifying age. Employers retain the right to postpone the leave if they can prove there would be a substantial adverse effect to the business.
In addition to the above Act there is also proposed legislation to give additional "baby leave" to parents. The Parental Leave and Benefit Bill 2019 provides for two weeks paid parental leave ("baby leave") with payments being made by the state at a rate of €245 per week. This is in addition to maternity and paternity benefit. Parents will become eligible for this benefit on completing one year's service. Parents must avail of this benefit within the first 52 weeks of their child's life. This entitlement cannot be transferred. The Government has plans to increase this benefit up to 7 weeks by 2021.
It has widely reported that Diageo have introduced 26 weeks paid leave to new Irish fathers. This is a bold move in an environment where employers are not obliged to pay paternity leave. It is a prime example of an employer who has the resources to do so offering additional benefits to their employees in order retain and cultivate employees with families. Innovative family friendly moves by companies like Diageo may put pressure on other employers to consider introducing similar benefits.
How will this impact employers?
Employers have expressed concern around the impact of these changes on their business to include the cost of retaining agency staff for short-term cover and maintaining continuity of service for clients and customers. It remains to be seen whether there will be a dramatic uptake in parental leave, which has historically been low for male employees. There is likely to be some uptake for "baby leave" which will be paid by the state when it comes into force.
What steps must employers take now?
- Employers should amend their parental leave policies to reflect the changes in the Parental Leave (Amendment) Act 2019.
- Employers should continue to maintain a record of the parental leave taken by employees. This will allow them to manage new requests for parental leave and assess requests by employees whose entitlements have increased under the Act.
- Employers should expect increased applications for the parental/baby leave and consider how they will plan and budget for those periods of leave.
- Employers will need to consider whether they will top up the parental leave benefit. There is no obligation on employers to take this step. However, if they choose to do so, they will be in a position to differentiate themselves from other prospective employers who only discharge the minimum required benefits to working parents.