rose to move, That the Grand Committee do report to the House that it has considered the Maternity and Parental Leave etc. and the Paternity and Adoption Leave (Amendment) Regulations 2008.
The noble Baroness said: The regulations before the Committee today make clear for employees and employers the terms and conditions to which an employee on additional maternity leave or additional adoption leave is entitled. Additional maternity or adoption leave is the second six months of the 52-week leave period. The regulations are necessary as a result of the amendments made to the Sex Discrimination Act in April this year, following the Equal Opportunities Commission 2007 case against the then Secretary of State for Trade and Industry.
Those amendments mean that employers will no longer be able to treat employees taking additional maternity leave less favourably than those on ordinary maternity leave in respect of employment benefits. The regulations clarify that the non-pay contractual benefits that women have during ordinary maternity leave are explicitly extended to additional maternity leave and that right applies to adopters taking additional adoption leave as well. They ensure legal clarity and consistency with the amended Sex Discrimination Act.
The regulations will come into force in October this year, given our commitment to common commencement dates for new employment legislation, and will apply to parents where the expected week of childbirth or placement for adoption is on or after 5 October 2008. The Sex Discrimination Act amendment also applies to women whose expected week of confinement is 5 October 2008 onwards. The timing of the maternity and adoption regulations before us today therefore dovetails with that of the Sex Discrimination Act changes.
Examples of the type of contractual benefit covered include accrual of contractual annual leave and the provision of company cars and mobile phones. Of course, that would be the case only where an employee is already entitled to such benefits as part of their normal contract of employment for their ordinary maternity leave.
These amendments, taken with the Sex Discrimination Act changes, also require that the full 52 weeks of maternity and adoption leave now be counted when assessing how long an employee has been working for an employer. Employers will benefit from the removal of the risk of claims for sex discrimination if they provide only the terms and conditions as currently required. I beg to move.
Moved, That the Grand Committee do report to the House that it has considered the Maternity and Parental Leave etc. and the Paternity and Adoption Leave (Amendment) Regulations 2008. 25th Report from the Joint Committee on Statutory Instruments.—(Baroness Vadera.)
I thank the Minister for whizzing through that. Regulations 4 to 7 of the Maternity and Parental Leave etc. and the Paternity and Adoption Leave (Amendment) Regulations 2008 amend the Maternity and Parental Leave etc. Regulations 1999 to extend the non-pay terms and conditions to which a woman is entitled during ordinary maternity leave—OML—to the period of additional maternity leave, in future known as AML. Regulations 8 to 10 of the amendment regulations 2008 amend the Paternity and Adoption Leave Regulations 2002 to extend the non-pay terms and conditions to which a woman is entitled during ordinary adoption leave to the period of additional adoption leave.
The regulations were debated in the other place yesterday. My honourable friend Mr Jonathan Djanogly gave a long, extended description of what they were all about. I want to avoid the Committee suffering that. He did it beautifully and received a lot of answers. However, a few questions were left, so perhaps the Minister would not mind if I ask one or two.
According to the DBERR impact assessment, the regulations will impose costs of more than £162 million, but will create zero financial benefit. Does the Minister believe that at a time of rapidly increasing economic competition it is right to lumber business with yet more regulations and costs? The British Chamber of Commerce estimates that government regulations have cost business in excess of £65 billion since 1998. There have been 14 new regulations every working day. Is this not just another one? It is often claimed that the bulk of the regulation under which United Kingdom business struggles is derived from Europe. Although the Government are well known for their zealous application of the European regulations, I do not think this is another one; I think these are regulations of their own creation. Perhaps the Minister will confirm that.
Many small businesses cannot afford to employ an extra member of staff. Therefore, how does the Minister believe that such businesses will be able to afford to maintain the benefits and privileges due to a member of staff on additional maternity leave and hire another member of staff to cover their job?
That is the end of the questions that I should like the Minister to answer now, if she can, with the help of her civil servants—or later, if she cannot at this stage. Every one of those questions relates to economics; obviously, I could have made a very long speech about regulations affecting maternity benefits and adoption law, but I do not think that she needs to hear me go through all that right now.
We really do not have any fundamental objections to this statutory instrument, but there is one question to which I would like a response. Why are not maternity and paternity leave combined to be parental leave? That would mean that women were no longer quite so stigmatised, with problems about employment and so on. Why is this not being considered? If it is being considered, when can we have an answer? The idea that one parent should choose which of them takes on responsibility would seem to be a logical extension of much of the Government’s rhetoric, if not policy. When will some consideration of this be given? Other than that, I do not really have much to add to the debate, but it would surely be a logical extension of what we have talked about to allow fathers to share more of the leave and childcare duties.
I thank noble Lords for their contributions and questions. With respect to the question on impact assessment, there is a cost of £162 million, including the adoption. That is a cost that amounts to approximately £125 per firm employing people. We understand and, I believe, share a passion with the noble Baroness about better regulation. However, it would be interesting to note the benefits around the importance of the role that women play in the labour market. In encouraging women into the labour market, we face productivity challenges; we have high levels of employment and a tight labour market, and it is very important that women continue to participate in that.
The noble Baroness may be interested to know that, while women’s employment rights have increased, the evidence shows that their participation in the labour markets has also been increasing. Compared with 1971, when they made up 38 per cent of the workforce, women are now 45 per cent of the workforce. Female employment rates in 1971 were 42 per cent and are now 70 per cent. That is among the highest in the EU, although the maternity entitlement is also the longest. But of course there is a balance to be struck and a legitimate discussion to be had to ensure that we are not complacent or introducing rigidities into the labour market.
On the noble Baroness’s question on gold-plating, this amendment followed a case in the High Court, in which we were considered to have underimplemented and were therefore required to implement. I strongly refute the suggestion that we zealously gold-plate or overimplement regulations.
On affordability, the noble Baroness will be aware that small and medium enterprises are entitled to recover 104.5 per cent of statutory maternity pay from the state. In the terms of employment, if they choose to give further maternity pay, they will be considering their own affordability issues.
The noble Lord raised an interesting question, which also came up in another place in yesterday’s debate. The Minister responsible for employment essentially said that there was a legitimate debate to be had about flexibility in paternity leave. It is important to recognise that maternal leave is set out in this way because the health of the mother is a factor, particularly in the early period after her baby is born, but adoption leave can be taken by either parent because that is not relevant. There is a debate to be had about the flexibility of maternity leave after a certain time. We also have to consider predictability for employers and their legitimate interest in this. Therefore, in 2006 the Government extended notice periods to support businesses in this matter.
I hope that that answers the questions that I was asked. I commend the regulations to the Committee.
On Question, Motion agreed to.