MT Exclusive: Vince Cable on the Government's new parental leave proposals

The Business Secretary tells MT why the Government isn't ignoring the concerns of business with its new rules on parental leave.

by Vince Cable
Last Updated: 06 Nov 2012
We want to create a society where work, family and personal interests complement one another instead of conflicting. One where employers have the flexibility and certainty to recruit and retain the skilled labour they need to develop their businesses. And one where employees no longer have to choose between a rewarding career and a fulfilling home and personal life.

Freedom, fairness, and responsibility are central to the Coalition Government’s vision of modern workplaces. By applying these values through an effective, efficient labour-market framework, the Government will give businesses the confidence they need to grow, which in turn will help encourage growth in the wider economy.  

It is clear that workplace relationships are changing fast, with employers and employees wanting to engage in a more flexible, personalised way. It is time our employment law properly reflected this.So we are consulting on our plans for a culture of flexible, family-friendly employment practices.

There are three main elements to our proposals. First, we propose to introduce an entirely new system of properly flexible parental leave. The current parental leave system is not fit for purpose. It is old fashioned, inflexible and gender biased. The state is meddling in things it shouldn’t be – dictating to employees and employers how parental leave should be taken. It is time our parental leave system enabled employees and employers to sensibly discuss their plans and find a pattern of leave that suits the family and the business.

Our plans are really quite simple - five months maternity leave, six weeks leave for fathers and 7 months flexible parental leave that can be shared between both parents. Unlike the current system this flexible leave could be taken at any time during the first year, in a number of different blocks and both parents could take leave at the same time. But crucially employers would have the ability to ensure that the leave must all be taken in one continuous period if agreement can not be reached.

This is a `win-win’ for employees and employers. Mothers’ rights are protected, fathers get greater fairness and the family gets more options. Employers benefit from improved staff morale and productivity. And they will be set free from the constraints of the current system so that they can negotiate patterns of leave that actually suit their business - allowing staff to return for an important pitch, help during a busy period or cover someone else’s annual leave without ending their leave entitlement.

Our second key proposal is to extend the right to request flexible working to all employees. The existing right to request has already given many parents and carers the greater flexibility they need to balance their personal and working lives. Extending this right will give all employees the opportunity to find work that fits around their other commitments. It will also help employers to recruit, motivate and retain their workforces, and so build successful businesses as well as increasing productivity.

Our third proposal is to take further steps to tackle the gender pay gap by requiring employers who lose Employment Tribunal cases on equal pay to carry out a pay audit.  Our proposals on flexible parental leave and flexible working will be important steps in tackling the underlying causes of the pay gap, in particular by helping to reduce the impact of taking time out of the labour market to have children. But where discrimination happens, it is right that Tribunals be given these additional powers to tackle possible systematic unfairness brought to light by individual cases.

We do not intend to rush these changes – we want to consult thoroughly, and take careful account of the responses we get. The changes to flexible parental leave, in particular, will not be in place before 2015, giving us plenty of time to get the detail right.  And we will work with business to make sure that these changes are undertaken in a way that minimises the costs and complexities on businesses. We have kept this principle in mind throughout the development of our proposals and are confident that they will bring wider benefits to businesses, not least from an engaged and motivated workforce.

It is important to remember that other successful economies like Germany, Norway and Sweden already have similar models that operate well. And for many successful British companies flexibility is a key element of their success.

Our measures will deliver on commitments that we made in the Coalition Agreement. More importantly, they allow us to move a significant way towards our vision of modern employment based on freedom, fairness, and responsibility for both employers and employees.

Vince Cable is the Business Secretary

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