Social Security Minister Judy Martin recently lodged draft legislation which, if approved, would extend employment rights from September, so that both parents would be allowed a year off work after having a baby and entitled to six weeks’ pay.
Paid parental leave in Jersey would be funded by the employing company, if the laws are approved. In most other European jurisdictions, parental leave is paid for by social security.
A statement released by the Jersey Chamber of Commerce says that it ‘wholeheartedly supports the provision of good and fair employment law’ for its member’s employees.
But it adds that while it accepts that the changes will provide ‘significant benefit’ to employees, the wellbeing of parents and Jersey as a whole, the entire burden of the new laws is being placed on the Island’s businesses.
‘The first challenge employers will face is an increase in costs: of funding the longer paid period of the recommendation as well as those incurred in seeking maternity/parental cover for parents,’ it says. ‘The current market is extremely buoyant, so to find the right person to cover business activities for a short period is an expensive and time-consuming process.
‘For some smaller businesses it will truly be a deciding factor for whether to trade at all. For others it will be something that will erode small margins or could tip a business into a loss-making position.’
‘In addition to this, the fact that the recommendation provides both parents the right to take up to 52 weeks leave, it will make it even more difficult for the employer to fill what could be sporadic but significant gaps in their workforce.’
Chamber pointed out that in the UK, businesses are able to seek funding from the government to cover paternal leave, with small businesses able to claim up to 103% of their costs.
‘The benefits that accrue to Jersey [from the new laws] will be tangible to the whole Island, so therefore Chamber feels that the Island should fully assist with their funding and not expect our businesses to largely fund them alone,’ the statement adds.
‘We are behind the underlying aims of the family-friendly recommendation, but feel that there should be some support offered to our businesses who already provide significant funding to the States through employing taxpayers, paying social security contributions, collecting GST and providing tax income from company dividend payments and 0/10 tax contributions.’
Chamber president Eliot Lincoln added: ‘While we fully support the aims of this potential new legislation, seeing our families supported, healthy, well cared for and educated as they become the next generation of employers and business leaders, we feel that the financial burden to be put on our businesses is too great and will place significant challenges on the smaller businesses in particular.’
