As part of their Plan to Make Work Pay, the UK Government has launched a comprehensive review of the current parental leave and pay system. The review will analyse all types of family leave.

The goal for the government is to explore how to:

  • modernise support for working families; and
  • boost the economy by making improvements.

This review could lead to significant changes in how parental leave is structured and accessed by parents across the UK and will therefore impact on both employees and employers.

Why Is the Review Happening and Why Does It Matter?

The current system of maternity, paternity, and shared parental leave has been in place for several years.

Complexity in the existing system is widely acknowledged as being confusing, resulting in low uptakes (particularly in shared parental leave). Maternity leave has also been criticised as effectively amounting to mothers receiving 44% less than the National Minimum Wage after the initial 6-week period; and fathers are forced to encounter similar issues related to their leave.

Research by the Centre for Progressive Policy suggests that closing gender employment gaps, through measures such as improved parental leave and childcare access, could boost UK economic output by up to £23 billion. Therefore, the Government is committing to improving these structures by making the system easier and fairer.

The review will obtain insights from experts, employers and parents, with a view to providing a roadmap for potential reforms.

What Is Being Reviewed?

The government’s review, announced in July 2025, will examine:

  • Maternity leave: Currently this lasts for 52 weeks but pay heavily reduces after 6 weeks.
  • Paternity leave: Currently, only lasts for two weeks, and many fathers do not engage in this.
  • Shared Parental Leave: The intended aim, to improve flexibility has not seen large uptake, possibly due to its complexity.
  • Statutory pay levels: Whether current pay levels meet the needs of working families.

What Does This Mean for Employers?

Employers should be aware that changes to parental leave entitlements may be on the horizon. While no reforms have been confirmed yet, the coming months will be a good time to:

  • Review current parental leave policies.
  • Consider how your organisation supports working parents.
  • Stay informed about developments in employment law and government consultations.

If the economic research holds true, improvements could aid employee retention, reduce long-term absence and improve employee wellbeing, thereby being beneficial in the long-term for employers and the economy.

Contact an Employment Law Specialist

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