What is the Neonatal Care (Leave and Pay) Act?

The UK government is striving towards offering better support to new-parent employees, especially during childbirth.

The introduction of the Neonatal Care (Leave and Pay) Act 2023 offers paid leave rights to employees whose baby is in intensive care. The Act won’t just affect those in the care industry – it’s applicable for employers across all businesses.

You must ensure your business complies with the Act once it fully comes into force. Any sign of neglect could result in serious consequences. Like paying fines, losing valuable staff, and even facing reputational damage.

For further advice, contact one of our expert HR advisors free of charge today. In this guide, we’ll look at what the Neonatal Care (Leave and Pay) Act is, who is eligible, and how employers can provide support during such difficult times.

What is the Neonatal Care (Leave and Pay) Act?

The Neonatal Care (Leave and Pay) Act 2023 is legislation that supports employees whose babies require specialist care after birth. The Act specifically applies to babies born on or after 6 April 2025.

The Act intends to support parents of babies who were admitted into neonatal care within 28 days of birth. Only eligible employees will be able to take paid neonatal care leave. This entitlement is available in addition to other statutory parental leave and pay entitlements.

It’s important to note that the Neonatal Care (Leave and Pay) Act received Royal Assent on 24 May 2023. However, it doesn’t officially come into force until April 2025. Despite that, employers should plan ahead to ensure their business stays compliant.

What counts as neonatal care?

The Neonatal Care (Leave and Pay) Act outlines three categories of medical assistance that count as neonatal care. These include:

• Medical care in a hospital.
• Outreach care provided under the direction of a consultant. (This includes ongoing care from the hospital and other healthcare professionals).
• Palliative or end of life care.

The qualifications for neonatal care must meet one of the three categories. It must also start within the first 28 days of the baby’s birth.

Who is eligible for Neonatal Care Leave?

As of 2025, Neonatal Care Leave (NCL) is a day-one right for all employees. To qualify for NCL, the employee must meet the following criteria:

Employment status: They must class as an employee.

Birth: Their baby must be born on or after 6 April 2025.

Parental status: At the birth of the baby, they must be the baby’s parents. This includes surrogacy parents or the partner to the baby’s mother.

Parental responsibility: They must have or expect to have responsibility for raising the child (similar rules apply to adoption).

Admittance: The baby must be admitted into neonatal care within 28 days from their birth. They must remain there for at least seven continuous days. (This period starts after the day the baby receives neonatal care).

Neonatal care leave: Neonatal care leave must be taken to provide care for the baby. The leave must also be taken in blocks of a week.

Who is eligible for Neonatal Care Pay?

Neonatal Care Pay is only available for employees through the following conditions:

Continuous service: They must be employed by their employer continuously for at least 26 weeks ending with the ‘relevant week’. (This is 15 weeks before the week of your due date). The requirements are different for babies born before their due dates.

Average earnings: Their average gross weekly earnings must be at least equal to the lower earnings limit, for National Insurance (NI) purposes. In April 2024/25, this is £123 per week.

Relevant period: Their earnings will be averaged over a period of at least eight weeks up to and including the last pay day before the end of the relevant week. This is known as the ‘relevant period’.

Neonatal Care Pay conditions are similar to that of Statutory Maternity Pay and Shared Parental Pay. It’s paid at a flat rate per week or at 90% of average weekly earnings – whichever one is less. It’s also paid for a maximum of 12 weeks; and is payable within the first 68 weeks of the child’s birth.

How much Neonatal Care Leave can you take?

Parents can take one week’s Neonatal Care Leave in respect of each interrupted week (seven days) that their baby receives neonatal care. (This only applies to babies born on or after 6 April 2025).

The maximum amount for NCL that employees can take is 12 weeks. The first qualifying period of seven days starts on the day after their baby receives neonatal care (i.e., day 2-8 of neonatal care).

When can Neonatal Care Leave be taken?

Neonatal Care Leave can be taken within the first 68 weeks of the baby’s birth (or adoption placement). During such times, employees may already be on some form of family leave as their baby is provided neonatal care.

NCL is often taken after neonatal care has ended and at the end of their maternity, shared parental, or adoption leave. However, there are cases where individuals will use NCL whilst their baby is receiving neonatal care. For example, when a father’s paternity leave entitlement has finished.

Are there different types of Neonatal Care Leave?

Yes, there are two categories of Neonatal Care Leave that eligible employees can take. These include:

Tier 1 period leave: This applies to leave taken whilst their baby is still receiving care and one week after being discharged. This leave can be taken in non-continuous blocks of a minimum of one week at a time. It ends on the 7th day after their baby stops receiving neonatal care.

Tier 2 period leave: This applies to all other leave and must be taken in one continuous block. There isn’t an option to take more than one period of NCL through the Tier 2 period.

Do you need to provide notice for Neonatal Care Leave?

Employees will need to provide notice for taking Neonatal Care Leave – but it depends on which form of leave they take. For example:

Notice for Tier 1 period leave

For each week of Tier 1 period leave, employees need to give notice before they’re due to start work on the first day of their absence. This is unless it isn’t reasonably practicable to do so. In which case, they must give as much notice as soon as reasonably possible. This form of notice doesn’t need to be given in writing.

Notice for Tier 2 period leave

For a single week of Tier 2 period leave, employees must provide notice within 15 days before the first day of NCL. For two or more consecutive weeks of Tier 2 period leave, they must provide notice no later than 28 days before the first day of NCL. This leave can only be taken in a single block.

How do you give notice for Neonatal Care Leave and Pay?

If employees are obliged to give written notice for Neonatal Care Leave, they must include the following information:

• The employee’s name.
• Their baby’s date of birth (or placement/entry into Great Britain for adoption).
• The start and duration date of neonatal care.
• The end date of neonatal care (if applicable).
• The chosen date for NCL (and pay).
• The number of weeks of NCL (and pay) the notice is for.
• Confirmation that NCL is being used to take care of the baby.
• Confirmation of eligibility for NCL due to their relationship with the baby.

If an employee has given notice before their baby has stopped receiving neonatal care, they must inform their employer of the date that their neonatal care ends. This should be done as soon as reasonably practicable after that date.

How to comply with the Neonatal Care (Leave and Pay) Act

Whilst the law is still being drafted, it’s important that employers prepare their business for upcoming legislative changes. The new Act won’t just apply to the healthcare sector – but across all industries.

Let’s look at steps employers will have to take to comply with the Neonatal Care (Leave and Pay) Act:

Prepare for longer leave periods

Employees will always take Neonatal Care Leave at the end of their parental leave entitlement. For example, they can’t pause maternity leave to take neo-natal leave, and then restart it.

Employers need to prepare for longer leave periods for any employee expecting a baby through pregnancy or adoption. Make suitable arrangements for them, as well as the business.

Hiring temporary workers, budgeting for leave pay, minimising work disruption… Planning ahead allows you to support new-parent employees – without impacting your business continuity.

Update notice period policies

Pregnant employees usually don’t know whether their baby will require neonatal intensive care after giving birth. So, they’re less likely going to think about notice periods.

As the Act doesn’t cover the rules on notice requirements, employers cannot force employees to complete them. (This is unless contractual terms apply). Instead, employers should update their notice period policies to include neonatal care issues.

For example, notice periods could be waived during neonatal events. This provides employees with support during such difficult times. Along with updates, it’s important to train your HR teams on how to manage these situations until the law passes.

Keep ahead of the law

Again, as the Neonatal Care (Leave and Pay) Act isn’t in force yet, it’s hard for employers and their HR teams to navigate around the details. Instead, prepare your business for upcoming changes and keep ahead of employment law.

This might include making workplace enhancements where possible. For example, the Act states you may need to provide suitable alternative employment to those on NCL during a redundancy.

Or you may need to apply data protection rules to documents that include private medical conditions relating to an employee’s baby.

Support returning employees            

Spending time in neonatal care can be traumatising for individuals. Some may suffer from both physical and mental long-term ill health, like depression or even PTSD.

Employers should be mindful of employees going through such events. See if you can spot changes to their performance, behaviour, and even their attendance.

It’s better to plan ahead for potential time off or sick leave requests. Avoid any form of discrimination relating to their health condition.

In 2023, the Government passed the Neonatal Care (Leave and Pay) Act 2023. This Act allows eligible employees to take paid leave if their baby requires specialist neonatal care within 28 days of their birth.

To keep ahead of this new family leave entitlement, employers should invest in creating a Neonatal Care Leave (NCL) policy. This policy will provide financial support to employees, whilst eradicating any stress relating to their work duties or position.

For further advice, contact one of our expert HR advisors free of charge today. Now, let’s take a look at how to create a Neonatal Care Leave policy for your business:

How to create a Neonatal Care Leave policy

In 2023, the Government passed the Neonatal Care (Leave and Pay) Act 2023. This Act allows eligible employees to take paid leave if their baby requires specialist neonatal care within 28 days of their birth.

To keep ahead of this new family leave entitlement, employers should invest in creating a Neonatal Care Leave (NCL) policy. This policy will provide financial support to employees, whilst eradicating any stress relating to their work duties or position.

For further advice, contact one of our expert HR advisors free of charge today. Now, let’s take a look at how to create a Neonatal Care Leave policy for your business:

Introduce the Neonatal Care Leave definition

Employers should start by introducing what Neonatal Care Leave is, as well as the purpose behind the policy. State your business’s intentions behind supporting parent employees who require neonatal care for their baby.

At this stage, your policy should inform employees about their right to request NCL if they require it. The policy must be in line with the Neonatal Care (Leave and Pay) Act and any other relative legislation. It should also highlight the fact that NCL can be taken in addition to other family leave entitlements, like Statutory Maternity Leave or Shared Parental Leave.

Highlight the key principles of neonatal care leave

The next step of your Neonatal Care Leave policy involves highlighting its key principles. Your policy should provide clear, transparent answers for the following questions:

• What counts as neonatal care?
• Who is eligible for NCL?
• Who is eligible for Statutory Neonatal Care Leave (SNCP)?
• How much NCL can be taken?
• When can NCL be taken?

Outline your Neonatal Care Leave requesting process

Part of your Neonatal Care Leave policy should outline how employees will raise leave requests. This includes everything from notifying the right people to returning back to work safely.

Whilst employers should be mindful of their staff going through such sensitive times, it’s important to complete absence procedures correctly. Not only will this ensure they’re paid SNCP on time, but it also protects other work entitlements affected by their absences.

Support their return to work

Once their Neonatal Care Leave period has ended, it’s important to establish whether your employee plans to return to work. They might have already chosen their return date and have informed you about coming back. Or they may decide to stay off work longer and concentrate on their family predicament.

If their NCL entitlement runs out, employers can choose to offer them carer’s leave or time off for dependents. Whilst these are unpaid benefits, it helps ensure the employee’s absences are documented appropriately. Offering support like this can help encourage a firm return to work – minimising the chances of them quitting their job.

What other policies and documents are associated with Neonatal Care Leave?

There are numerous policies and documents that are associated with Neonatal Care Leave. This includes eight new letters and 11 updated documents relating to Neonatal Care Leave. Let’s take a look at them:

• NEO01: This is an updated document offering guidance notes on the new NCL entitlement.
• NEO02: This is a new letter given to employees informing them of the new NCL entitlement.
• NEO03: This is a new letter used to confirm an employee is taking NCL and will receive SNCP.
• NEO04: This is a new letter used to confirm an employee is taking NCL and won’t receive SNCP.
• NEO05: This is a new letter used to inform an employee that they aren’t eligible for NCL.
• NEO06: This is a new form used by employees to notify their intention for taking NCL.
• NEO07: This is a new form used by employees to notify their entitlement for SNCP.
• NEO08: This is a new checklist for employers to use when dealing with a NCL request.
• NEO09: This is a new list of do’s and don’ts for employers when dealing with NCL.
• APD02: An updated paragraph on NCL entitlement has been added to Adoption Leave entitlements.
• ADP03: An updated paragraph on NCL entitlement has been added to Adoption Leave entitlements for surrogacy.
• MAT01(Esh): An updated paragraph on NCL entitlement has been added to Statutory Maternity Pay (SMP).
• MAT02 (Esh): An updated paragraph on NCL entitlement has been added to SMP.
• MAT01: An updated paragraph on NCL entitlement has been added to SMP.
• MAT02 (Esh): An updated paragraph on NCL entitlement has been added to those not entitled to SMP.
• MAT02: An updated paragraph on NCL entitlement has been added to those not entitled to SMP.
• PAT04: An updated paragraph on NCL entitlement has been added to the grant request for Statutory Paternity Leave.
• R2: References on additional protections afforded to employees taking NCL during redundancy situations have been added to the family leave guidance notes.
• R9A: References on additional protections afforded to employees taking NCL during redundancy situations have been added to guidance notes on involuntary consultation meetings for Statutory Maternity Leave and Sick Leave.
• R9B: References on additional protections afforded to employees taking NCL during redundancy situations have been added to guidance notes on reschedules and written subs for Statutory Maternity Leave and Sick Leave.

Get expert advice on the Neonatal Care (Leave and Pay) Act with Peninsula

The last thing expecting parents want to deal with is their baby being put into intensive care. Employers can provide additional support during such tragic times, through additional paid leave entitlements.

Peninsula offers expert advice on the Neonatal Care (Leave and Pay) Act. We offer specialised guidance on HR contracts and documentation – ensuring your business meets all its HR compliance.

Want to find out more? Contact us on 0800 028 2420 and book a free consultation with one of our HR consultants today.