As part of next week’s proposed Budget, chancellor Rishi Sunak is expected to announce plans for Neonatal Pay and Leave. This would allow parents of premature babies to claim additional statutory paid leave whilst their child is in neonatal care.

Proposals for Neonatal Pay and Leave were announced in the 2019 Good Work Plan. Such proposals came as a result of a campaign led by Catriona Ogilvy, a mother who spent time in a neonatal ward after her son was born 10 weeks early and subsequently founded the charity The Smallest Things. The campaign was backed by over 350,000 people and has already caused many employers, including Sony, the Mayor of London, Nationwide and a number of London councils, to give additional leave to staff who have premature babies.

Current law provides that maternity and paternity leave start the day after birth, regardless of whether a baby is born prematurely. Statutory maternity leave offers a maximum of 52 weeks’ leave which cannot be extended if the baby remains in hospital for a period of time after birth. This can pose a serious challenge to parents as it often leaves them with less time with their baby at home and may lead to parents taking unpaid leave or annual leave in order to care for their baby.

Under the new plans, where a baby is in neonatal care for more than one week, parents will be entitled to claim statutory paid leave for every week the baby remains in care, up to a maximum of 12 weeks. The leave will be paid at a rate of around £160 per week, which is expected to be payable by the government and not the employer. This leave and pay will be in addition to the usual family leave entitlements, such as maternity, paternity and shared parental leave.

The full details of this leave are still to be announced and it is not clear exactly how this will work in practice, in particular in relation to employer notification processes and the levels of proof that will be required from parents. The plan also has potential to extend the amount of leave that both parents will take, as is does not appear that it will be restricted only to the parent who has the main child care responsibility. We await clarification of the mechanics, and will be in touch with clients with any further updates and points to consider from a practical perspective. In the meantime, employers should bear in mind that parental leave policies may need to be updated in the near future.

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