Parental leave now, less pension in the future?

Parental leave now, less pension in the future?

Published on: 29 July 2020

Just had a son or a daughter? You are allowed to take five weeks of additional leave as of July 1st as a partner. The salary payment will be continued by the UWV (Executive Institute for Employee’s Insurances).

So, that is a nice option. But how about the accrual of pension: does that continue as usual in the meantime?

 

The five workweeks of additional leave are a great addition to the five days of parental leave every partner is entitled to anyway. This latter leave is paid in full by the employer. 

However, some rules apply to the new leave arrangement. For example, these five weeks can only be taken after the first parental leave of five days. In addition, this additional parental leave has to be applied for at least four weeks in advance with the employer and be taken within six months following the birth.

 

70 percent continued salary payment

The UWV takes over the salary payment during the leave. That means a temporary drop of income. The UWV pays 70 percent of the salary and applies a maximum daily wage. For many employees, this daily wage can deviate quite significantly from their actual - higher - daily wage. In some cases the employer supplements this payment up to 100 percent by the way.

 

And what about the accrual of pension?

The opportunity to take care of your child for five weeks obviously is a priceless experience. On the other hand, it is also smart to calculate everything properly in advance. For now, later on and in the future. Because what about the accrual of pension: will that continue as normal during those five weeks? That differs per pension arrangement. The accrual of pension can often be continued partially or voluntarily.

 

Even more leave

The government is looking to expand the arrangement of paid parental leave even further in 2022. At the moment, parents are allowed to take 26 weeks of additional unpaid leave. In the future, nine of those weeks will be paid at 50 percent of salary. This leave can be taken up to eight years following birth, but continued payment only takes place in the first year. The Lower House of Parliament will vote on this issue after the summer.

 

More information about the Law on implementation of additional parental leave (Wet invoering extra geboorteverlof, WIEG) can be found on Rijksoverheid.nl

Published in these collection(s)

Pension

Collection in Income