Understanding Neonatal Care Leave and Pay: What Employers Need to Know

Lucy Nicholl
Jun 8
4 min read

What is Neonatal Care Leave and Pay?

This new law (the Neonatal Care (Leave and Pay) Act 2023) gives parents whose newborn babies need extra hospital care an additional right to time off. In practice, if an employee’s baby is born early or has a health condition requiring stay in a neonatal (special baby) unit, the parent can take up to 12 weeks of leave on top of any maternity, paternity or shared parental leave they already have. The leave is a day-one right, meaning employees qualify from their first day of work. Eligible parents can take this leave once their baby has spent 7 or more consecutive days in neonatal care. The leave must be used within about 68 weeks of the baby’s birth.

Parents may also get pay during this leave. To qualify for Statutory Neonatal Care Pay (SNCP), an employee must have at least 26 weeks’ service before the week the baby was due and meet the usual earnings test. If they do, the pay is at the standard statutory rate (the same as statutory paternity pay) – currently £187.18 per week or 90% of normal pay, whichever is lower. If not, the leave is unpaid. (Some employers may choose to pay more, but the law only guarantees the statutory amount.) This new leave is in addition to all other parental leaves – it doesn’t eat into an employee’s maternity or paternity leave.

A mother with her newborn baby requiring medical support

Who is covered?

The new rights apply to parents (and co-parents/partners) of babies who need neonatal care within 28 days of birth, for stays of at least 7 days. In simple terms, this means any mother or father (or their partner) whose baby is born early, ill or very small and must stay in a special care baby unit can claim this leave. It even covers adoptive, fostering or surrogacy parents in the same situation. Each eligible parent gets their own separate leave entitlement (so both parents could take time off). Importantly, there is no minimum service needed to take the leave itself – unlike some other family leaves, an employee can qualify from day one. (Only for the paid element do they need the usual 26 weeks at work and earnings).

When will it start?

The law came into force on 6 April 2025. It applies in England, Scotland and Wales (Northern Ireland has not introduced matching rules yet). The entitlement only applies to babies born on or after 6 April 2025. Any baby admitted to neonatal care before that date does not count under this Act. Once it’s in force, parents can only use this leave for a baby’s neonatal care up to about 68 weeks after birth (about 15 months).

Preparing Your Business

Even though this is new, the steps you need to take are straightforward. As of April 2025, every employer should update their policies and systems to reflect the new rights. For example:

Update your employee handbook and contracts to include the new neonatal leave rules. Spell out the process for requesting neonatal leave and pay. (Acas recommends making the notice and claim process clear in your policy).
Check your payroll/accounting systems. Make sure your payroll can process Statutory Neonatal Care Pay at the right rate when needed. You will be able to recover most of this pay through the usual HMRC scheme (similar to SMP/SAP recovery).
Train managers and HR. Ensure anyone in your organisation who deals with absence or leave requests knows about the new rights. Managers should handle requests sensitively – these parents are going through a very stressful time. For example, be prepared to give some leeway on notice periods (if a parent cannot give weeks’ notice because of an emergency) and treat requests compassionately.
Communicate to your team. Tell your staff about the new entitlement. Even in a small business or community group, it’s helpful for everyone to know what support is available. Clear communication now can avoid confusion later.

Beyond these basics, think through how to cover staff if someone takes this leave. Because the leave can last up to 12 weeks, you may need temporary cover or to adjust workloads. It’s also wise to include employees on neonatal leave in any special redundancy protections you already offer (by law they get at least the same protection as for maternity leave). On the plus side, being an employer who supports families in crisis can boost morale and loyalty – so many businesses find it worth going beyond the minimum requirement.

If you want to offer more than the minimum, you can consider enhancements. For example, some employers may choose to pay full salary instead of statutory pay, or allow more than 12 weeks off. Whether you stick to the legal minimum or add a top-up, just be sure your policy is clear and consistent.

Need help or resources?

Implementing a new entitlement doesn’t have to be daunting. We’ve created a

to help you get started – it covers leave, pay and notice requirements in plain language. And if you’d like hands-on support, Nicholl HR offers guidance and training tailored for small organisations. We can help you update your policies, adjust your payroll, or run a quick workshop so your managers feel confident handling neonatal leave requests.

You’re not alone. We know that as a small business you wear many hats, and keeping up with changing laws can feel overwhelming. But this change is about supporting new parents during a very difficult time. By preparing now, you can make sure your workplace is empathetic and fully compliant. Please get in touch if we can assist with resources or advice – we’re here to help you get it right, so your team and their families are cared for when it matters most.