Bosses Back 'Family Friendly' Bill

19 October 2005

Government plans to introduce greater flexibility for working parents were given a cautious seal of approval by employers today. Extending paid maternity leave and establishing three months paid paternity leave was in line with the flexible approach to the realities of the modern workplace already being adopted by many UK employers, the Institute of Directors (IoD) said.

In a strong caveat, however, the IoD told the Government that for the proposals to work, the Inland Revenue must absorb the burden of administration.

Miles Templeman, Director General of the IoD, said:

"Allowing new parents to trade off their maternity and paternity leave will hopefully benefit employers. If the mother is the more highly skilled and productive parent and returns to work sooner than expected, while her partner cares for the child, many businesses will suffer less disruption than under the present arrangements."

While the IoD said it backed most aspects of the Work and Families Bill, announced today by the Trade and Industry Secretary, Alan Johnson, it was still concerned that businesses will have to stump up maternity and paternity pay out of company coffers and then recoup the money from HM Revenue and Customs. If the Government is to win over sceptical businesses then it is crucial that they transfer responsibility for paying statutory maternity and paternity pay from employers to the State. This would help companies manage this important change in employment law, the IoD added.

Recent survey evidence shows that there is a keen awareness amongst employers of the need to embrace family-friendly policies and flexible working, the IoD said.

Miles Templeman, said:

"Our members, by and large, support family-friendly policies. Three out of four believe that it is actually morally right for society to have family-friendly policies in the workplace. They realise that these policies aid staff recruitment and retention and ultimately boost morale.

"However, that said, we cannot ignore the fact that smaller firms will finder it harder to cope with these proposals, hence the pressing need to reform the administration of maternity and paternity pay."