New neonatal care leave and pay rules confirmed

The government has confirmed that new neonatal care leave and pay rules will come into force from 6th April 2025. If you are an employer, it’s important that you’re aware of the new regime and comply with it. In this article, we look at the upcoming changes and what they mean for your business.

Why will there be new neonatal care leave and pay rules?

The government has identified that many parents have to return to work while their babies are sick in hospital.

The new rules are designed to let parents be with their child without needing to return to work or use up existing leave.

As a result, from April 2025, parents with babies who are in neonatal care will get extra time off as a day one right. This is dependent on parliamentary approval, but this should be a formality.

How is neonatal care defined?

Neonatal care is normally defined as medical care received in a hospital. It can also be ‘outreach’ care experienced after discharge, as long as it is overseen by a consultant and includes monitoring and visits by health professionals. Neonatal care also includes end-of-life care.

How do the new neonatal care leave rules work?

Neonatal care leave will be available for families of babies admitted into neonatal care. It can be used by the baby’s parents, intended parents (i.e. surrogate parents), or the partner of a baby’s mother who is expected to be responsible for raising the child.

To qualify, the baby must be admitted by the age of 28 days and stay continuously in hospital for at least seven full days. Eligible parents will be able to take up to 12 weeks of neonatal care leave. Essentially, a parent can take a week of leave for each week of neonatal care the child receives. This is extra to any other leave they’re entitled to, such as maternity or paternity leave.

Neonatal care leave falls under two ‘tiers’. Tier 1 leave is taken while a child is in neonatal care or in the week after their discharge. This can be taken flexibly in weeklong blocks. Tier 2 leave is any remaining leave entitlement that is taken after discharge. Parents can take up to 12 weeks over both tiers, not 12 weeks in each tier.

If an employee intends to take leave, they need to give their employer 15 days’ notice for tier 1 leave. Tier 2 leave requires 28 days’ notice. Employers are free to waive or shorten either notice period. All leave must be taken within 68 weeks of a child’s birth.

What about pay during the leave period?

Parents taking neonatal leave will qualify for statutory neonatal care pay (SNCP) if they have at least 26 weeks of service and earn at least an average of £123 per week.

Will the new rules affect my payroll?

Yes, the new rules will affect your RTI payroll. There will be a new data item in the ‘Full Payment Submission’ that allows you to report the SNCP that is paid. There’s also be new ‘reclaim’ and ‘compensation’ values in your ‘Employer Payment Summary’. These will work in a similar way to values for other statutory payments.

If you’re a THP client and you use our payroll outsourcing services, we will help make sure you comply with the new neonatal care leave and pay rules. If you have any questions or concerns, please speak with your account manager.