Furloughed workers will receive full parental leave entitlement
27 April 2020: the government has confirmed that furloughed workers taking paid parental or adoption leave will be entitled to pay based on their usual earnings, rather than a furloughed pay rate.
Workers whose period of family-related pay begins on or after 25 April will be assessed on their usual, full rate of pay, the government confirmed in a statement on Friday.
According to the statement, the current regulations have been changed to avoid penalising employees taking family-related leave, meaning statutory payments will be based on full pay not furloughed.
Full earnings will apply to Maternity Pay, Paternity Pay, Shared Parental Pay, Parental Bereavement Pay and Adoption Pay.
Entitlement to Statutory Maternity Pay, as well as the other forms of Parental or Adoption Pay, are currently calculated through someone’s average earnings over an eight-week assessment period. For Maternity Allowance, entitlement and the rate payable is also determined by looking at average earnings over a 13-week period.
The changes will ensure those intending to take time off following the birth, adoption, or death of a child will not see their entitlement to pay affected as a result of being furloughed in the wake of the COVID-19 fallout.
In a comment accompanying the statement, Business Minister Paul Scully said: “Maternity and other forms of parental leave are pivotal times in people’s lives, and they should absolutely be protected from the impacts of COVID-19.
“These measures will ensure those on the Coronavirus Job Retention Scheme continue to receive the parental leave and pay they are entitled to,” continued Scully.
Lords Minister for the Department for Work and Pensions, Baroness Stedman-Scott added: “At an already challenging time for families, peace of mind that they can rightly take time off and receive their full entitlement will provide much needed reassurance.”
For the latest news and guidance on the ongoing impact of COVID-19 for businesses and accountants, visit ICAEW’s dedicated coronavirus hub.