The Protection from Redundancy (Pregnancy and Family Leave) Act 2023 came into force on 24 July 2023.
The new legislation gives those who are pregnant or individuals returning from parental leave preference for redeployment opportunities in a redundancy situation.
Currently, employees who are on maternity leave, shared parental leave or adoption leave have the right to be offered first access to suitable alternative vacancies, if one is available, before being made redundant over other employees.
The Protection from Redundancy (Pregnancy and Family Leave) Act 2023 extends the priority status to pregnant employees and those who have recently returned from maternity leave and shared parental leave. However, it requires further regulations from the government to set out precisely how the entitlement will work. The regulations are expected to come into force around April 2024.
Who will be protected?
In addition to those on maternity leave, shared parental leave or adoption leave, the Act extends protection to:
- A pregnant employee who is in ‘a protected period of pregnancy’
- An employee who has recently suffered a miscarriage
- Maternity returners
- Adoption leave returners
- Shared parental leave returners
Information on the extent of the protection afforded is very limited in scope at this stage.
However, we can gather some details of the expected breadth of the protection from the consultation undertaken. For example, the length of protection is most likely to be six months for those returning from leave. A ‘protected period’ of pregnancy is likely to commence once an employer is informed by its employee of her pregnancy.
Additionally, there may be provision for employees who have a miscarriage before the employer was even made aware of the pregnancy, so that the protected period begins after the end of the pregnancy, thus allowing the employee to receive the protection she would have otherwise been entitled to.
For now, we will need to wait for the regulations for the precise scope of protection under the Act.
Employers will also need to wait for the regulations to see what length of protection is given to those who have taken shared parental leave. The government’s consultation response acknowledged that giving a new parent six months’ redundancy protection after taking just a week of Statutory Parental Leave would not be sensible or practical.
Key considerations for employers
For now, as we await the regulations setting out the detail of the new protections available, employers should begin to consider the implications of such, and the practical issues that may arise.
- New and expectant mothers will be able to double their period of redundancy protection to a period of about two years (assuming they tell their employer about their pregnancy at 12 weeks, take the full 52 weeks of maternity leave, and are then protected for six months afterwards).
- Feedback at the consultation stage highlighted the difficulty that will be faced by employers when engaging in a redundancy exercise, particularly where the majority of the workforce is female and must be given priority for suitable alternative vacancies. Practically, women may feel they need to inform their employer of their pregnancy as soon as they are aware to protect themselves if there is an impending redundancy exercise, where they may have waited previously until the 12 weeks mark.
- As Statutory Parental Leave is available for either parent to use and is becoming increasingly utilised by fathers, for example, by extending the protection from redundancy to include the period of return after such leave, employers will inevitably see a rise in men acquiring protection rights in a redundancy exercise.
- Pending clarity on the ramifications of failure to offer a protected employee a suitable alternative vacancy, we expect the regulations to permit similar types of claims to be brought to those afforded under the current law, namely automatic unfair dismissal and discrimination. Therefore, failure to prepare and have in place robust training and policies for managers is crucial to minimise the risk of litigation.
- Undoubtedly, there are powerful arguments from a social policy perspective to support parents to return to the workforce to enhance the economy by developing career progression and bolstering staff retention. Practically this may feel like an incredibly heavy onus on employers at a time when businesses (especially SMEs) are struggling. In practice, this could lead to resentment amongst the workforce where a reduction in the workforce is non-negotiable, but will come at the heavy price of potentially losing high-performing employee(s) in favour of an employee with preferential status.
- Employers will also need to work hard on robust systems in identifying suitable alternative employment. Quite often employers fail in acting reasonably in demonstrating genuine or meaningful attempts at redeployment, including across all operations and/or group companies, which can prove costly and time-consuming.