Contractual issues

Contractual issues during neonatal care leave

An employee's contract of employment continues throughout their leave unless either you or the employee lawfully ends it, or it expires (such as if it's a fixed-term contract).

Terms and conditions during neonatal care leave

During their leave, an employee has a statutory right to continue to benefit from all the terms and conditions of employment that would have applied to them had they been at work, except for the terms relating to pay.

Examples of contractual terms and conditions that continue during neonatal care leave include:

  • Gym membership
  • Participation in share schemes
  • Reimbursement of professional subscriptions
  • The use of a company car or mobile phone (unless provided for business use only)

Continuous employment and neonatal care leave

Neonatal care leave counts towards an employee's period of continuous employment for the purposes of entitlement to other statutory employment rights, e.g. the right to a redundancy payment and any contractual rights, such as benefits that depend on length-of-service.

Accrual of annual leave

An employee continues to accrue statutory - and any contractual - annual leave entitlement throughout neonatal care leave.

An employee can't take annual leave during neonatal care leave - but can take it immediately before or after it. They can carry over any untaken leave into the next holiday year, but it must be used by the end of that holiday year.

Contributions to a workplace pension scheme

Employers must maintain their usual contributions to the employee's pension during neonatal care leave, which must not be reduced if the employee receives statutory neonatal care pay (SNCP).

Employees must continue to pay their pension contributions if the pension scheme rules require them to do so (these can be reduced when receiving SNCP). They won't have to make any contributions towards their pension when they're not receiving SNCP. However, they can still make voluntary contributions if the pension scheme rules allow them to.

Returning to work from neonatal care leave

Employees have the right return to a job with the same seniority, pension rights and similar rights. They will also have the right to return to a job with the same terms and conditions (including remuneration) that are as favourable as they would have been if they had not gone on leave.

Following neonatal care leave, employees will be entitled to return to the same job that they had before taking the leave if they:

  • only took neonatal care leave; or
  • took no more than 4 weeks of parental leave; or
  • took neonatal care leave after another period of statutory family leave taken for the same child (except parental leave) and the total leave taken was 26 weeks or less.

If they return to work after taking a period of leave that doesn't comply with the above, they'll still have a right to return to the same job, unless you cannot reasonably give it back to them.

If so, they will have the right to return to another job that is both suitable and appropriate for them to do. This must be as close as possible to the previous role they had, and include the same remuneration, seniority, status and terms and conditions of employment (i.e. they should be treated as if they had not been absent).

They are also entitled to benefit from any general improvements to the rate of pay or other terms and conditions introduced while they were away.

Employees returning to work from statutory family leave may want to make a request to work flexibly, e.g. to work from home or do part-time hours.

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