MATERNITY - 09.02.2018

Maternity rights made simple

Leave for everyone…

All women are entitled to 52 weeks’ maternity leave regardless of how much they earn or how long they’ve worked for you. The first 26 weeks are called ordinary maternity leave and if they come back after that time they must get their old job back.

The second 26 weeks are additional maternity leave and anyone who takes more than 26 weeks off only has to be offered a role that is “suitable and appropriate on the same terms and conditions” .

The minimum any woman can take off is two weeks, unless they are a factory worker when the compulsory leave is four weeks.

…but maybe not pay

They may not be paid for any of this leave as maternity pay is subject to having a certain level of average earnings and 26 weeks’ service at the end of the 15^th week before the baby’s due date. Even if the employee is due to be paid, the government will fund some or all of the statutory maternity pay SMP due.

Employees who don’t qualify for payment via their employer must be given an SMP1 exclusion form within 28 days of you working out they don’t qualify so that they can apply to receive maternity allowance direct from Jobcentre Plus.

Who qualifies for pay and how much?

Any employee (there is no lower age limit) or director who has enough service and average weekly earnings subject to Class 1 NI, i.e. not based outside the UK, of at least the lower earnings limit for NI (£113 p.w. 2017/18; £116 p.w. 2018/19) in force at the start of the qualifying week (15 weeks before the baby’s due date) qualifies for SMP.

The average earnings are those paid on the last normal pay day on or before the Saturday at the end of the qualifying week, and the last normal pay day at least eight weeks before that date.

SMP is paid for up to 39 weeks at a weekly rate set by the government that changes from the Sunday at the start of the first week of the tax year. So on Sunday 1 April 2018 the rate increases to £145.18 p.w. (from £140.98 p.w.).

Most women get more for the first six weeks as there is a higher rate of 90% of the average that was calculated.

For low earners, 90% of their average can be as low £101.70 for 2017/18, i.e. 90% of £113. See Follow up for a maternity pay calculator.

Pro advice 1. There is no upper limit to average earnings so any woman who has a bonus or commission that falls just at the right time will receive 90% of that for the first six weeks.

Pro advice 2. The woman needs to still be pregnant at 24 weeks. A miscarriage before that date is treated as a sickness absence, not maternity.

Do you have to cover the cost?

The good news about the 90% rule is that however high that first six weeks’ worth of SMP is, the government allows employers to recover 92% of it, or 103% if your Class 1 NI contributions were £45,000 or less in the employee’s qualifying tax year, i.e. the last complete tax year before their qualifying week. The extra 3% compensation is for the employers’ NI paid on SMP.

Recovery is claimed each month on the employer payment summary (EPS).

Effect of a pay rise

As a result of the European Court of Justice’s decision in Alabaster v Woolwich plc and Secretary of State for Social Security 2004 , you must recalculate a woman’s SMP if the effective date of a pay rise falls in the period starting with the beginning of her eight-week average earnings period and finishing with the end of her maternity leave (whether additional or ordinary).

You must recalculate her average weekly earnings to include the pay rise as though it had been effective from the average earnings period.

This means most women will need at least one recalculation and the payment of additional SMP. The same rules apply, but are more logical(!) if the employee received a backdated pay rise that would have inflated her average earnings.

Employee leaves, obligation to pay ends?

Unlike with SSP, the employee still qualifies for SMP if she leaves work after the start of the qualifying week for any reason including because she has resigned or been made redundant.

Notice

The employee must give you 28 days’ notice of the start date of her maternity leave although in practice many do that much earlier. Of course, if the baby comes along very early she may not have given notice but that doesn’t prevent her from qualifying for SMP, she just lets you know as soon as possible.

The notice need not be in writing unless you request it and the employee does not need to say if she intends to return to work after her absence; it is assumed she is off for 52 weeks. If she wants to come back earlier then she must give eight weeks’ notice.

Evidence

She should also have medical evidence relating to her pregnancy (usually a certificate MAT B1 from a registered medical practitioner or a registered midwife). This evidence cannot be accepted by the employer earlier than 20 weeks before the due date.

Flexible start dates

The employee can start her maternity leave on any day of the week as she may want to take some holiday before leave begins. Holiday continues to accrue whilst on leave so she will have a lot to use up. The earliest that leave can start is the eleventh week before the baby’s due date.

If the employee has been off sick with a pregnancy-related absence, for example high blood pressure, and it’s now four weeks before the baby’s due date, then she starts the leave automatically at that point four weeks early, or on the day after the first day of absence if she goes off sick in that four-week period.

Pro advice 1. If the employee resigns after her qualifying week, but before the eleventh week, then the leave starts on the Sunday at the start of the eleventh week.

Pro advice 2. If the baby is born before leave was due to start, then leave begins on the day after the baby’s birth.

Keeping in touch days

With a woman able to be off for 52 weeks it can be daunting to come back after a year off, so she can ask to come in for up to ten days during her leave with no effect on her SMP. These are called keeping-in-touch (KIT) days.

She can’t insist on working, and you cannot insist on her coming into work.

KIT day pay

On a KIT day, she should receive her normal pay for that day of which the daily equivalent of SMP has been deemed to paid. The daily rate of SMP is the weekly rate divided by seven (£20.14 for 2017/18 and £20.74 for 2018/19).

Records

With GDPR in mind, the retention period for maternity records is three years after the end of the tax year in which the maternity pay period ends.

Maternity pay calculator