Finland has recently announced plans to offer fathers the same parental leave as mothers from 2021. The country will be the first in the world to offer each parent seven months’ leave. The minister of Health and Social Affairs, Aino-Kaisa Pekonen, said the aim of the reform was “to improve gender equality and to boost a declining birth rate”.

Finland is one of many European countries improving paternity rights. Austria, Italy and the Netherlands, for example, have all recently increased paid paternity leave or plan to do so soon. And the European Union has also got in on the act, with new EU-wide rights to paid paternity leave (from day one) and to two months paid parental leave coming in under the Work-Life Balance Directive, which member states must implement by 2 August 2022.

The UK is unlikely to implement the Work-Life Balance Directive. Having left the EU, it won’t have to do so unless the government extends the transition period, which it has vowed not to do. But the UK government has promised to make it easier for fathers to take paternity leave and to bring in a new right to carers’ leave. And it is possible that it will choose to bring UK law into line with the new EU rights in other ways.

The current system in Finland only offers fathers just over two months leave and only one in four fathers takes it. Crucially, under the new system, only half of the seven months of leave can be transferred to the other parent, meaning that more than three months of leave must be taken by the father or will be lost. Single parents will have the right to use the parental leave quotas for both parents, meaning that they will be entitled to 14 months of parental leave.

The previous Finnish government had rejected the new scheme as too costly. The current government estimates that the changes will cost an extra €100 million. But there are two reasons to suggest that this €100 million might be a worthwhile long-term investment.

Firstly, Finland is one of several European countries suffering from declining birth rates; the period from 2010 to 2018 saw a decline of nearly a quarter of new-borns in Finland. There is evidence to suggest that women in countries with a high employment rate give birth to more children and Pekonen said other countries such as Sweden and Iceland had seen increases in their birth rates after offering more leave for fathers.

Secondly, an increasingly even distribution of parental leave is seen as a long-term precursor to economic gender equality. A liberal maternity policy matched with a short paternity policy can give the impression that it is a woman’s responsibility to look after her child and a father’s responsibility is to work. There is evidence to suggest, and indeed it is the hope of the Finnish government, that creating a fully matched policy will disrupt if not extinguish this stereotype. A decrease in the gender pay gap brings about inevitable benefits to an economy as workers, regardless of sex, will remain in positions that they are most suited to. The results are clear in Sweden where studies suggest that the more paternity leave men take, the more women make. A study in Sweden showed that each additional month of parental leave taken by the father increases the mother’s earnings by approximately seven percent.

There are also social benefits for the new-born child and for those in the parental relationship. The Finnish minister, Pekonen, said, in the press release following the introduction of paternity leave, that it has been shown that a more equitable distribution of the domestic workload among parents decreases the risk of divorce. There is also evidence to suggest that a father bonding with a child in the earlier years of the child’s development has a positive effect on the child’s emotional wellbeing, intelligence, and self-esteem.

With evidence of clear benefits for society, and increased motivation in parents, it is no wonder that a few companies worldwide, including the Telegraph Group, Aviva and Diageo, are offering equal parental leave regardless of the legislation. However, when paternity leave is not a statutory right, it may take a long time for cultural norms to catch up and fathers who do take leave may be looked down upon by their peers and by senior management. We might be seeing a shift in attitudes however as 85 percent of fathers surveyed across seven countries by Dove Men+Care indicated their willingness to be more involved with caring for their child. This has been further evidenced by the high uptake in paternity leave by employees at Aviva in the UK, with fathers on average taking 21 weeks.

The previous UK government consulted last year about possible reforms to the system of family-related leave, and it remains to be seen whether Boris Johnson’s administration will make changes to the system of shared parental leave. Whether it does or not, it seems likely that a future UK government will further improve paid leave rights for fathers and that employers will continue to do so on a voluntary basis.

For more information, please contact Yoko Nakada on yoko.nakada@lewissilkin.
For further information, please contact Koichiro Nakada – Head of Japan Business Group (koichiro.nakada@lewissilkin.com) and Yoko Nakada - Senior Associate, Deputy Head of Japan Business Group (yoko.nakada@lewissilkin.com).
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