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The Neonatal Care (Leave and Pay) Bill

A new bill, namely the Neonatal Care (Leave and Pay) Bill (“the Bill”), was passed by the Government on the 15th July 2022 which will allow parents to take an additional 12 weeks leave to be with their babies if they require additional care after birth. This neonatal care leave will be in addition to other parental leave rights, such as maternity leave, paternity leave, parental leave and shared parental leave.

The Bill, however, will need to be approved by the House of Lords before it becomes law. If approved, we may still have to wait until 2024 or 2025 for this entitlement to be introduced, as HM Revenue & Customs and commercial payroll providers usually require 18 months’ notice to implement changes which enable employers to administer new statutory payments.

It is estimated that more than 50,000 babies a year spend more than one week in neonatal care after birth. Therefore, the introduction of this law will allow parents of babies born prematurely or sick and in need of neonatal care to take leave and be by their baby’s side whilst their baby receives care in a hospital or another agreed setting for a prolonged period of time. This is often a difficult time for parents and the introduction of this Bill will avoid parents having to use their existing leave entitlements, take unpaid leave or return back to work whilst their baby is still in hospital. Further, for those parents who have limited time off after the birth of a child, such as those on paternity leave who only receive two weeks time off work, this new Bill will be a welcome introduction.

The Bill will also allow employers to be able to support their employees during this difficult period of time. In response to the Government’s consultation, 90% of employers were in favour of neonatal leave and pay as they found that many employees were using sick leave to spend time with their babies often costing employers significant sums of money as they cannot reclaim statutory sick pay. Under the Bill, it is expected that employers will be able to reclaim the cost of statutory neonatal pay, meaning that this will create a huge cost saving for employers.

It is expected that once this Bill is approved and becomes law, it will apply to parents of babies who are admitted into hospital up to the age of 28 days and have a continuous stay in hospital of 7 full days or more. The right to take neonatal leave will be a day one right for all employees and entitlement for statutory neonatal pay will be available to those employees who have 26 weeks’ continuous service and meet minimum earning tests.

If the House of Lords approve the Bill, then employers will need to consider implementing a new policy within their business to confirm an employee’s neonatal care leave and pay entitlement and the process for employees to notify the employer that they wish to exercise their right to take neonatal care leave.


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