Maternity leave extension could cost UK £2.5 billion

Plans to extend the length of maternity leave, by the EU to 20 weeks on full pay could cost the UK £2.5 billion per year.

The British Chamber of Commerce (BCC) argues that the plans will prove to be costly for employers and difficult to handle while EU governments deal with budget deficits in the aftermath of the recession.

Currently pregnant women are entitled to receive six weeks’ salary at 90% of their average earnings, followed by 33 weeks of statutory maternity pay at £125 per week.

The womens’ rights committee voted in favour of extending maternity leave provisions through the Pregnant Workers’ Directive earlier this year but the proposals were held up when Conservative MEPS demanded an impact assessment of the costs.

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Kieran O’Keefe, head of European affairs at the BCC, said that the proposals were “completely unaffordable” during the current economic climate.

He added: “This Directive should be about setting minimum EU standards for the health and safety of pregnant workers, not adding new payroll costs for overburdened companies and national security systems.”

“The Commission’s original proposal to extend maternity leave to 18 weeks, but with individual member states allowed to decide the level of pay, is a better, more affordable option.”

However, Sarah Jackson, chief executive of Working Families, said that the proposals would not increase costs to employers as the Government recompenses employers for statutory maternity pay and called for fathers to receive full paid leave also.

She commented: “Many employers already pay women on maternity leave above the statutory minimum because they know it encourages high return rates from mothers.

“If the UK wants to become the most family friendly place in the world, both parents should be supported to take paid leave in the first year of life. We’d like to see a levelling up for men and would endorse EU calls for men to be paid paternity leave at full pay.”

The European Parliament will vote on the proposals next month.