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Sharing parental leave and pay lead

Sharing parental leave and pay

26 February 2015

An update on the latest childcare legislation

The governing legislation is lengthy and complex but, in a nutshell, it allows mothers to return to work early and share their remaining maternity leave and pay with the father. It provides for a maximum of 50 weeks of shared parental leave and up to 37 weeks of statutory shared parental pay.

The latest instalment in the law relating to childcare applies in relation to babies due on or after 5 April 2015 or children placed for adoption on or after that date.

As regards pensions, paid shared parental leave will be subject to the same requirements as other periods of paid family leave:

  • The employer will have to pay pension contributions based on the employee’s usual level of pay, while the employee will pay contributions based on the pay that they actually receive
  • Benefits continue to accrue during periods of paid shared parental leave
  • Service is continuous, but periods of unpaid shared parental leave can be excluded.

As with previous changes in this area, employers and trustees need to examine their scheme rules to see if they are wide enough to accommodate the new requirements. Administrators will also need to ensure that their systems are able to reflect the various categories of a member’s pensionable service history.

Author: Peter Scott, Technical Consultant - Regulatory and Pensions Support at Equiniti.

For more information on this topic, please contact your account manager.

Ezine issue: April 2015

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