What is the Neonatal Care Act?

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Under the Employment Rights Act 1996, the Neonatal Care Act will be introduced to support employees who have a newborn baby receiving palliative or medical care.

This means that it will be easier for employees to be granted Neonatal Leave and Neonatal Care Pay to look after their babies. The Neonatal Care Act received Royal Assent on 24 May 2023, and it is scheduled to come into force in April 2025.

What will employees be entitled to?

It is anticipated that employees who qualify for neonatal care will be offered the additional entitlement if their baby needs medical or palliative care within 28 days of the birth.

For employees with a sick or premature newborn baby, it will potentially offer the following additional rights:

1. Entitlement of up to 12 weeks of extra leave
2. Entitlement to statutory pay during this leave period

It is anticipated that the leave and pay will cover both parents, which means that they could both be entitled to up to 12 weeks of paid leave.

This will be in addition to other leave entitlements such as maternity, paternity and shared parental leave.   Employees may also be entitled to a statutory pay allowance during the leave.

What’s the criteria for neonatal care leave?

Employees may need to supply evidence to their employer before being deemed eligible. To qualify, employees need to have a premature or sick baby receiving medical or palliative care and:

• The care must start within 28 days of the child being born
• The newborn must have been receiving care for at least seven days

If possible, employees must let their employers know that they wish to take neonatal care leave before the intended date of the leave.

All employees will be eligible for neonatal care leave from day one of their employment.

Eligibility criteria will be similar to paternity or shared parental leave, with employees needing to have a parental or other close personal relationship with the baby.

What pay will employees on neonatal care leave be entitled to?

• Rates of pay: The new legislation states that neonatal care leave will be paid at either a fixed rate or earnings-related weekly rate – similar to statutory sick pay.
• Qualifying for the leave: In order to qualify for Neonatal Care Pay, as with other forms of parental leave, an employee will be required to be employed for a minimum of 26 weeks prior to the leave being requested and have earnings on average of at least £123 a week. This will be the same as the entitlement to maternity pay.
• Impact on additional leave: Neonatal care leave can be taken in addition to any maternity or paternity leave. It is also in addition to annual leave and annual leave entitlement will not be affected by neonatal leave.  Businesses will therefore need to manage the additional leave, especially if both parents are employed by a business.

We are awaiting further guidance on whether or not and, in what circumstances  employers can refuse neonatal leave, but employers will need to manage the legal requirements alongside their business needs.

As this will be a sensitive time, employers should be considerate towards the parents, ensuring that the process is dealt with as efficiently as possible. Being mindful of the employee’s well-being is paramount, and employers should ensure that they don’t fall foul of any discrimination laws during the process.

The new legislation will only affect England, Scotland and Wales. So businesses in these countries will have until April 2025 to make sure they’re ready.

Some businesses are already considering setting up their policies early. If you haven’t done this yet, it’s worth getting advice from an employment law specialist who can help you to create a robust policy for your organisation.