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New EU Directive seeks to address employees’ work-life balance

European Union Member States will need to implement the provisions of the EU Directive on Work-Life Balance for Parents and Carers by mid-2022. The Directive is aimed at addressing the imbalance of care-giving responsibilities between men and women and contains a large number of considerations for businesses around workplace equality. Lucy Trevelyan assesses the Directive and explains what it means for employers and their in-house lawyers.

The European Parliament and the European Council have approved a new directive that aims to address women’s underrepresentation in employment and encourage a better sharing of care-giving responsibilities between women and men.

The Directive on Work-Life Balance for Parents and Carers 2019/1158 was formally adopted by the European Council in June 2019, and must be transposed by Member States by the middle of 2022. It requires Member States to ensure fathers can take paternity leave for at least ten working days when a child is born, irrespective of family or marital status and receive a payment or allowance at least equivalent to the EU level of maternity leave.

Requirements for parental leave will also change: parents presently have a right to at least four months unpaid parental leave per parent, with one of the months being non-transferable between parents. The Directive makes two months non-transferrable and requires both parents to be paid. Member States must also allow parental leave to be taken in flexible forms, such as on a part-time basis. The level of compensation will be determined by the Member State.

The Directive further requires Member States to ensure that workers with children up to at least eight years of age and caregivers have the option of flexible working arrangements. The duration of such arrangements may be limited in a reasonable way. Workers have the right to return to the same work pattern at the end of the agreed-upon period.

Finally, caregivers’ leave is introduced by the Directive for workers providing ‘personal care or support to a relative, or to a person who lives in the same household as the worker, and who is in need of significant care or support for a serious medical reason’. Caregivers are entitled to five working days of leave per year, although there is no requirement that carers’ leave should be paid.

Mikaël Pelan, Newsletter Editor of the IBA Diversity and Equality Law Committee and a lawyer at Lusis Avocats in Paris, says the Directive seems to affirm the principle of workplace equality; however, it offers limited tools to ensure it.

‘The only tool which is directly aimed at this is the obligation to share the parental leave between the parents; however, it seems it will have a very limited impact because it applies to only a two-month period,’ says Pelan.

 

‘With the sole exception of parental leave, the Directive offers very limited tools to remediate the underrepresentation of female employees’

Mikaël Pelan, Newsletter Editor of the IBA Diversity and Equality Law Committee

 

‘All the other provisions, in particular the care leave, which is limited in its length, or the faculty to adapt the working time, do not include any provision aimed at equality, and there is a risk that this tool, if it is ever used, will only be used by women,’ he adds.

The Directive seems more effective, Pelan says, in its aim of helping workers to achieve a better work/life balance. ‘It provides the obligation for states to ensure that employees are awarded allowances during the leave they are entitled to. It also includes the necessity to take measures to ensure that employees can benefit from flexible working arrangements.’

However, he adds, the work-life balance provisions still only address very specific situations and are far from taking into consideration the day to day work-life balance issues. This issue is directly related to the matter of workload versus working time, one made all the more acute due to the existence of electronic devices.

Pelan believes it is always very difficult to assess the effectiveness of these kinds of regulations, and that irrespective of the provisions, cultural attitudes are key.

‘For very concrete and obvious reasons maternity leave will constitute a major obstacle to this kind of remediation unless there is a cultural shift. Moreover, when introducing other provisions, and with the sole exception of that of parental leave, the Directive offers very limited tools to remediate the underrepresentation of female employees.’

One way to address these issues, Pelan says, might be to introduce mandatory provisions or at least to refer to a rate of the parental leave provided by the national regulation to ensure, for example, that the parental leave is equally split between employees of each gender in a couple.

Jaouad Seghrouchni, a lawyer at Rutgers & Posch in Amsterdam, says one of the potential risks of the new provisions is that it is not an obligation but a right for the employee to take the leave.

‘It could therefore be considered as a ‘career limiting move’ by some employers when employees choose to take one of the aforementioned periods of leave,’ he says. ‘I doubt whether the introduction of measures to protect employees against adverse treatment – as included in the Directive – will entirely prevent this.’

The Directive could have been more effective in achieving its aims, believes Seghrouchni, by forbidding the transfer of any part of the parental leave; as a consequence of this, both men and women would have the same amount of parental leave.

‘In addition, it might be an idea to include a minimum amount of parental leave that employees should take, unless this would seriously disrupt the good functioning of the employer. However, this is probably a solution that reaches too far.’

 

‘It might be an idea to include a minimum amount of parental leave that employees should take, unless this would seriously disrupt the good functioning of the employer. However, this is probably a solution that reaches too far’

Jaouad Seghrouchni, lawyer at Rutgers & Posch

 

The Directive is a step in the right direction for equality within the workplace and the improvement of work-life balance policies and will benefit mothers and families, says Mariella Nigrelli, a lawyer at CMS in London.

‘The Directive offers better recognition and remuneration of the care provided by families and a broader scope of protection than any previous laws, which will enable many thousands of additional workers to gain access to family-related leave,’ says Nigrelli, noting that the Directive will assist in particular with access to fathers’ rights to parental and paternity leave. ‘This will inevitably help with promoting the participation of women in the labour market, the equal share of caring responsibilities between men and women and closing the gender pay gaps.’

The Directive does not, however, deal with a number of issues, she says, including updating the arguably outdated maternity leave provisions, allowing the right to request flexible working conditions for all parents with children, and clarifying the rights of self-employed people.

To further incentivise fathers to share caring responsibilities, statutory paternity leave should be extended and statutory paternity pay increased so it is more in line with statutory maternity pay (SMP), Nigrelli says. ‘Carer’s leave being unpaid, meanwhile, will mean we are more likely to see more woman taking unpaid work, which will reinforce the gender pay gap issues.’

Arguably, the key benefit of the Directive is that it sets a more modern agenda for addressing the needs of working families across the EU, says Colin Leckey, a partner at Lewis Silkin.

‘However, the Directive stops short of radical change and shows signs of political compromise. Carers leave, for example, is unpaid. Fathers (or co-parents) will gain a new right to two months paid parental leave which is exclusively reserved for them, but EU countries can set their own level of pay.’

The Directive is only intended to draw the baseline for minimum standards across the EU, he says. ‘Some countries will go further, and many already do. In fact, family leave and pay schemes differ markedly between EU countries and this is likely to remain the case following the roll-out of the new Directive.’

In several EU Member States, the government pays for paternity and parental pay rather than employers, adds Leckey, and some argue that this approach should be adopted more widely and that paternity and parental pay needs to match full salary before it becomes a realistic option for all.

‘Meanwhile, many countries are adopting other measures to address female underrepresentation,’ explains Leckey. ‘For example, the UK implemented a gender pay gap reporting scheme in 2017 which is spurring many of our leading companies to double down on senior female representation. A number of EU countries, including Belgium, France, Germany, Italy and the Netherlands, have implemented measures to drive up the number of women on company boards.’

 

‘The Directive offers better recognition and remuneration of the care provided by families and a broader scope of protection than any previous laws, which will enable many thousands of additional workers to gain access to family-related leave’

Mariella Nigrelli, lawyer at CMS

 

Large employers have a role to play here, he says. ‘Some companies are responding to workforce demands for greater flexibility and work life balance by opening up greater opportunities for flexible working, recognising that this isn’t just an issue for parents and that it may be the key to attracting younger generations.’

The Directive’s introduction of a right for employees to return to their old working pattern at the end of an agreed period of flexible working is good for employees but could be problematic for employers, says Sarah King, an employment solicitor at Excello Law and a part-time employment tribunal judge.

‘For example, employers may need to hire someone to job share two days per week to facilitate flexible working,’ says King. ‘When the flexible worker wishes to revert to full time work, the person hired to share their job may have to be made redundant. This may involve costs for employers and could even create risks for employers in terms of potential employment law claims.’

Times are changing and flexible working is increasingly prevalent in both the private and public sectors, says King. It is bound to continue to play an important role in helping businesses operate more efficiently and flexibly, while also giving employees a better work life balance.

‘Technology has made home working possible, and has done away with the grind of the daily commute for many. That alone can free up many hours in the week for those with caring responsibilities – hours that would otherwise be lost to commuting.’

King believes that governments could develop incentives for employers to encourage home working, even for a day or two per week. ‘As well as the social and personal benefits this offers, increased home working would reduce carbon emissions and traffic congestion.’

There is an increasing recognition by many managers that incentivising employees with flexible working makes business sense, not least because it can help companies to attract and retain talent, she says.

‘However, it can take time for these benefits to be fully appreciated and for meaningful cultural change to take place within organisations, as some of these changes would also require rearranging business structures. Hopefully, over time, the benefits of flexible working will be more broadly appreciated.’

‘We hear a lot about “business agility” these days,’ adds King. ‘Yet it is more than a buzzword. It seems like a concept whose time has come in our age of rapid social, economic and technological change.’

‘Businesses that quickly adapt to the demand for flexible working will be best positioned to thrive and adapt flexibly to in this changing environment. The demand for flexible working and work-life balance is now coming not just from employees, but also from governments, and indeed the EU – as this Directive clearly shows.’

As for achieving a better work-life balance for workers, says Pelan, other countries could take a leaf out of France’s book. France introduced – through a law that took effect on 1 January 2017 – an obligation on employers to allow employees to disconnect from their professional activity. The law applies to businesses with more than 50 employees and provides employees with a legal right to ignore work-related emails outside of their normal working hours.

‘This should be viewed more as the possibility to provide employees with principles and tools to achieve that goal. The aim is to bring about a cultural evolution, rather than a mere obligation to block any and all connection to the company network.’

The approach of the French Supreme Court, which – in its judgment no 1656 of 29 June 2011 (09-71.107) – required companies to provide tools in order to monitor their employees’ workload – might also be of interest, he says. ‘The idea is not to define a single rule which will apply to all companies, but to set a target and give the companies the opportunity to define how to achieve it.’

If the Directive is properly implemented and complemented by affordable childcare it could be a major step in ensuring that women remain engaged in the labour market and in turn, contribute more towards their pensions and to the wider economy, says Paul Kelly, Head of Employment at Blacks Solicitors in Leeds.

‘As the pay gap between mothers and fathers is wider than between women and men in general, the Directive will hopefully address this disparity, but again it will depend on the rates of pay Member States set and whether taking leave is actually affordable,’ he says.

 

‘As the pay gap between mothers and fathers is wider than between women and men in general, the Directive will hopefully address this disparity, but again it will depend on the rates of pay Member States set and whether taking leave is actually affordable’

Paul Kelly, Head of Employment at Blacks Solicitors

 

Governments, Kelly says, have several options to make it more attractive for women to get back into the labour market if these measures are not taken up by fathers and second parents. 

These options include introducing ‘greater tax breaks on the cost of childcare for working parents – especially low earners – which will allow women to return to work without worrying about the often crippling burden of childcare costs,’ he says.

Kelly suggests another measure would be to reduce the stigma that many fathers feel when taking leave to look after children by extending, for example, the UK’s Equality Act 2010 so it covers those on paternity or parental leave.

Employers, he says, can also do more to encourage fathers and second parents to take up their right to paternity/parental leave. ‘Fathers may be worried about taking leave in case they are made to suffer a detriment at work and [of] the negative stigma attached to taking time off for childcare. Jobs can also be advertised to confirm whether the position is appropriate for flexible working.’

He adds: ‘As the Directive only encourages Member States to pay for the five days of carer’s leave, imposing a minimum level of pay could ensure take-up. Workers are less likely to take up the option of carer’s leave if they are not paid or will lose income.’

Indeed, according to recent research by Carers UK, nearly five million people juggle paid work and unpaid care – around 15 per cent of the UK population – and 468,000 people have left their jobs to care for a loved one who is older, disabled or seriously ill in the last two years alone. The cost to the economy of carers being forced to give up work to care is estimated at £5.3bn in lost tax revenues and earnings and additional benefit payments.

How onerous the new provisions are for organisations to comply with will depend largely on how much employers are required pay their employees while on leave, says King. ‘It would certainly be onerous for employers to pay absent employees even relatively low rates of pay for six months’ parental leave each year,’ she says. ‘The flexible working scheme which gives employees the right to return to their old working pattern is similar to what is required of employers after maternity leave. This may present challenges for workplace planning, however businesses of all sizes have successfully adapted to the maternity leave regime.’ 

For the UK, she says, the flexible working provision will not be too onerous, since the right to request flexible working is well-established and employers are accustomed to managing changing flexible working arrangements. ‘The challenge is the attitude to this style of working and the willingness to reform working structures to fit around the hours of an employee’s highest productivity.’

In-house lawyers have a role to play in promoting workplace equality and ensuring a work-life balance for employees that is more cultural than regulatory, says Pelan. ‘As far as equality is concerned one way might be to show, in a concrete manner – through promotions for example – and by valuing those kinds of choices, that the decision to take time, be it a maternity leave, parental leave or [another kind of leave] has no negative impact on a career.’

The same analysis applies to work-life balance, he says. Pelan believes it is upon the company management to make everyone else understand that what matters is an employee’s contribution to the company’s performance, and that this is not incompatible with being able to disconnect from their professional activity. Employees should feel able to not have to email people while they are not at work, and likewise to not have to answer work emails at this time. 

As well as ensuring that relevant policies are in place to promote workplace equality and ensure a work-life balance, in-house lawyers should be actively promoting shared parental leave within the workplace and endorse an environment where it is culturally acceptable for males to undertake childcare responsibilities, says Nigrelli.

‘Promoting flexible working is important in creating a culture where employees feel there is flexibility in their working schedule to allow them to balance work-life priorities,’ she says. ‘If employees feel they work in an understanding workplace they are more likely to be loyal to your organisation, and give more back in terms of productivity, better work ethics and longevity of service. This will allow both parents to invest time in their careers while simultaneously enabling parents to take a more equal responsibility for childcare duties.’

In-house lawyers should make employers aware of the new directive and the domestic legislation that will follow this Directive, says Seghrouchni. ‘In addition, they should try to convince employers to create an environment on the work floor where employees (both men and women) are free to work less than full-time without being afraid of an impact on their career.’