If you are planning on having a baby, understanding the rules around paternity pay can help you to plan your finances. When you have a baby – whether it’s your first or not – you’ll have some serious number crunching to do to ensure the bills can be paid. It’s not just about looking at maternity pay – dads will likely want time off to help with their newborn.
There is legal provision for childcare leave for dads, which includes adoption and surrogacy. Alice Haine (opens in new tab), personal finance analyst at Bestinvest, the DIY investment platform and coaching service, says: “While in the past it was assumed that women would take maternity leave to care for a child while their partner continued to work, times have changed and men increasingly want to be involved in the early stages of their child’s life.
“Men can take up to two weeks of paid paternity leave in one go, which gives them valuable time to spend with their new baby and share the multiple challenges that come with having a newborn baby in the house with their partner.”
Make sure you understand how maternity pay is calculated too so you can adequately plan your finances.
Paternity pay: who is eligible?
Statutory paternity pay is a government benefit and like all other benefits there are certain eligibility criteria that must be met. You need to have been continuously employed by your current employer for 26 weeks or more by the end of the 15th week before the child is due.
If your child is born early, you qualify for paternity pay if you would have been working for your current employer for at least 26 weeks by the qualifying week. You must also be earning at least £123 a week before tax. For casual staff or agency workers, you may not be eligible but it’s worth asking HR to check.
How much paternity pay can dads get?
The statutory rate of paternity pay is £156.66 or 90% of average weekly earnings – whichever is lower – although your employer may offer more.
At least 15 weeks before the baby is due, you’ll be asked to tell your employer the due date, when you want your leave to start – perhaps the day of the birth or the week after the birth – and if you want one or two weeks’ leave. You can ask for paternity pay at the same time, and you’ll be asked to complete a form called SC3. The money will then be automatically paid into your bank account.
Annabelle Williams (opens in new tab), personal finance specialist at Nutmeg, says: “Sometimes dads and non-birth parents don’t tell their employer that they’re going to become a father until the baby is nearly due. It’s best to have a chat with your employer around the time your partner tells their boss about the pregnancy, to give your workplace enough time to prepare for your absence.”
Is paternity pay full pay and how long do I get it for?
Dads are entitled to just two weeks paternity leave, paid at a minimum statutory rate. Though if you’re employed (not self-employed) you might be entitled to more. You’ll need to check with your employer. While your employer may offer more, it is unlikely to ever be at full pay. Your employer is not allowed to offer less than statutory paternity pay.
Statutory paternity pay is only for two weeks as a bare minimum. Your employer might offer a longer period and a better rate than just statutory paternity pay.
Any money you receive is treated like ordinary income, so income tax and National Insurance will still be deducted.
How much paternity leave can dads get?
Dads can choose to take one or two weeks paternity leave. The leave must be taken in one go, and a week relates to how many days would normally be worked in a week. Leave cannot start before the birth and it is the same length even in the case of a multiple birth – twins, for example
Paternity leave applies to people in same-sex partnerships as well as heterosexual couples. And they don’t need to be married to the mother. The leave is intended to help care for a new baby or to support the mother, so it must be taken within eight weeks of birth or adoption.
Unpaid leave for attending antenatal appointments
A father can take unpaid leave to accompany a pregnant woman to antenatal appointments if they are the expectant mother’s spouse or civil partner, in a long-term relationship with the expectant mother or the intended parent if they’re having a baby through a surrogacy arrangement. They can accompany the woman to two appointments of up to 6 and a half hours each.
Adoption or surrogacy
The same amount of paternity leave applies if the couple are adopting a baby or having a child through surrogacy. However, the rules differ slightly in that you must have worked for your employer for at least 26 weeks by the time the couple are matched with the child to be eligible.
The father must also provide proof of the adoption to secure the time off. In addition, the date you can take the leave starts on the date the child is placed with you and again must be taken within 56 days of that date.
When on paternity leave, your employment rights are protected, so you can still accrue holiday during your time off and will still be entitled to a pay rise if it is awarded while you are away.
Employees still qualify for paternity leave and pay if the baby is either stillborn from 24 weeks of pregnancy, or if the baby is born but later passes away.
Is shared parental leave an option?
There are other options for new dads that could also be considered. The Shared Parental Leave and Pay scheme (opens in new tab) was one of the flagship policies of the 2010 coalition government, to promote female equality in the workplace.
It allows new mums and dads to share maternity and paternity leave. Parents can share up to 50 weeks of leave and up to 37 weeks of maternity pay between them in the first year after their child is born, or in the case of adoption, placed with them.
Personal finance analyst Alice Haines says: “This makes great sense if the father will be the main carer over the long term, or if the mother is the main breadwinner in the household and wants to speed up her return to work and a full salary.”
Shared parental leave is also flexible, so the parents can either take the time off in one go or take it in up to three blocks or more if their employers approve – effectively taking it in turns to care for their child.
