EMPLOYER organisations warned of “crippling” extra costs yesterday as it emerged that big increases in paternity and maternity pay are likely to be considered for Labour’s manifesto.
Downing Street tried to calm business fears after Patricia Hewitt, the Trade and Industry Secretary, gave her personal backing to suggested improvements in parental leave payments and more flexible hours for working carers.
Tony Blair’s official spokesman said the proposals were a “party matter”, making plain that they were not yet government policy and repeated previous pledges that there would be no changes before 2006. “I do not think we should get ahead of ourselves,” he said.
Aides to Ms Hewitt also stressed that the proposals were her own ideas, contained in a “personal pamphlet”, and not party policy. Any changes to parents’ rights at work would come after 2006 and following consultation with unions, employers and other affected parties, one said.
Even so Ms Hewitt’s words appeared to be aimed at Labour activists as they prepare for next week’s conference, and were swiftly welcomed by the TUC.
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Ms Hewitt disclosed the plans as she called on the Government to get back to domestic issues. Under the plans new fathers would see their statutory paternity pay in the two weeks after the birth of their child increased from about £100 a week to 90 per cent of their salary.
Mothers could get maternity pay for the first full year of their child’s life. At present they are entitled to six months’ paid leave — at 90 per cent of salary for the first few weeks, then £100 a week for the remainder — and six months unpaid. Ms Hewitt’s proposal would extend the £100 weekly payment for the rest of the year. And it would also be payable to fathers.
The British Chambers of Commerce said that the plans, and in particular those on maternity leave, “could have a crippling effect on many small businesses who have just a small number of staff.”
Mr Blair made clear in his speech to the TUC last week that the work-life balance would be a key area for the third term he hopes Labour can win. Susan Anderson, director of human resources policy at the Confederation of British Industry, said: “It’s all very well to say we want more family-friendly rights but if we don’t consider the impact on the employer then there aren’t going to be jobs for them to go back to.
“I’m sure firms, particularly smaller firms, are going to wonder who’s going to pay for it and how they are going to cope with further absences.
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“There will be costs — not just because of the costs of the pay itself but the costs of employing temporary workers and the uncertainty that arises when you don’t know whether somebody will come back.”
But the TUC general secretary, Brendan Barber, said: “Patricia Hewitt has put the policies agreed at Labour’s Policy Forum at Warwick into a compelling case for a new and radical focus on the workplace in a third Labour term. Employers may complain, but this is a compendium of vote winners.”
Fathers Direct, the national information centre on fatherhood, welcomed Ms Hewitt’s proposals, but expressed disappointment that the Trade and Industry Sexcretary had stopped short of advocating the “daddy month” — four weeks of paid paternity leave taken flexibly in the early years of a child’s life.
Duncan Fisher, the director of Father’s Direct, said: “We hope that she will revise her proposals given the weight of research showing that the children of involved fathers do better at examinations, are less likely to get into trouble with the police and enjoy long-term mental health benefits.”
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HOW COUNTRIES COMPARE
BRITAIN
Maternity leave: 26 weeks paid, 26 weeks unpaid
Pay: statutory pay for the first six weeks at 90 per cent of average weekly earnings
Next 20 weeks paid at £102.80 a week or 90 per cent of weekly earnings, whichever is less
Paternity leave: two weeks paid at £102.80 a week or 90 per cent of weekly average earnings, whichever is less.
Annual bank holidays: 8
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FRANCE
Maternity leave: Depends on number of children
First or second child: 16 weeks; third or more child: 24 weeks; multiple birth: 34-46 weeks.
Pay: 100 per cent up to maximum of £45.04 a day
Paternity leave: two weeks or three weeks for a multiple birth.
Three days are paid at 100 per cent, the rest at £45.04 a day
Annual bank holidays: 11
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GERMANY
Maternity leave: 14 weeks or 18 weeks for a multiple birth
Maternity pay: 100 per cent
No paternity leave
Annual bank holidays: 12
ITALY
Maternity leave: two months before birth; three after. Where the working mother is carrying out activities that might endanger pregnancy, this increases to three months before birth; three after
Pay: Minimum of 80 per cent
Paternity leave: three months after birth but only where the mother has died or is seriously ill or where the father has exclusive custody of the child
Paid at minimum of 80 per cent
Annual bank holidays: 10
SPAIN
Maternity leave: 16 weeks paid at 100 per cent.
Paternity leave: two days plus a further two if mother lives in a different town from father.
Paid at 100 per cent.
Annual bank holidays: 12
SWEDEN
Parental Leave: maximum of 480 days, split between parents, but neither can take more than 420 days.
Pay: A minimum of £13.45 or 80 per cent of “SGI” divided by 365 during the first 390 days. Then paid at £4.48 each day during remaining 90 days. (SGI is calculated in relation to employee’s annual salary)
Annual bank holidays: 16
UNITED STATES
Leave: 12 weeks for mother; 12 for father. Unpaid
Annual bank holidays: 10
Source: ius laboris, international alliance of employment law specialists