Maternity pay and Maternity benefits

Money during maternity leave

During maternity leave you may receive Statutory Maternity Pay (SMP) and/or Contractual Maternity Pay.

If you are not eligible for SMP but have been working, you may be eligible for Maternity Allowance or Incapacity Benefit through Jobcentre Plus.

The figures given here are correct for April 2003–04.

Statutory Maternity Pay

Statutory Maternity Pay (SMP) is the minimum level of maternity pay that your employer must pay you, providing you meet the qualifying conditions. Your employer will get back at least 92 per cent of this from the Inland Revenue.

You do not have to repay SMP if you decide not to return to work at the end of the pay period.

Statutory Maternity Pay rates

SMP can be paid up to a maximum of 26 weeks. This is called the Maternity Pay Period (MPP). It is payable at two different rates:

the first six weeks at 90 per cent of your average earnings, with no maximum limit; and
the remaining 20 weeks at a standard rate of £100 a week or 90 per cent of your average earnings, if this is less than £100.

Qualifying for Statutory Maternity Pay

You qualify for SMP if:

you have been employed by the same employer continuously for at least 26 weeks into the 15th week before your EWC, this is know as the qualifying week (QW); and
you have average weekly earnings equal to or above the Lower Earnings Limit (LEL) for National Insurance purposes (currently £77), in the 8 weeks up to and including the last pay day before the end of the QW. The calculation may differ depending on your pay period, for example monthly paid.

The LEL is the point at which you start to be treated as if you have paid NI contributions. You will not have actually paid contributions until your earnings reach the primary earnings threshold.

If you are off sick during the relevant period

and are paid Statutory Sick Pay, your SMP may be reduced, or you may not qualify for SMP at all.

If you do not qualify for Statutory Maternity Pay

your employer must, within seven days:

provide form SMP1, explaining why you do not qualify; and
return your MATB1 form so that you can claim Maternity Allowance from Jobcentre Plus instead.

Start date for Statutory Maternity Pay

SMP can be paid from the beginning of the 11th week before your EWC. The Maternity Pay Period (MPP) will usually start the week after you have stopped work to have your baby, but you must give your employer at least 28 days’ notice.

It is up to you to decide when to start your MPP, but if:

you are absent from work for a pregnancy-related illness on or after the start of the fourth week before your EWC, your SMP will start the day following the first day of absence from work; or
your baby is born before the date you notified or before you have a notified date, your MMP will begin the day following the birth.

SMP is normally paid in the same way as your wages, that is weekly or monthly, with deductions for tax and National Insurance.

Dispute with your employer about your Statutory Maternity Pay

If your employer refuses to pay you SMP, or if you think your SMP has been wrongly calculated, ask them for a written statement, or form SMP1.

If you still disagree, consult your trade union representative or use the grievance procedure at work. If this fails, apply to your local Inland Revenue officer to make a formal decision within six months of the first day on which your SMP should have been paid.

If the Inland Revenue officer decides in your favour, your employer must pay your SMP within a fixed time, or they may appeal. If they fail to pay, ultimately the Inland Revenue will pay it to you. You may additionally, or alternatively, go to an Employment Tribunal (ET) to recover unpaid wages.

If you disagree with the Inland Revenue decision, you can appeal but you will need to get advice from a solicitor or law centre.

Dismissal or redundancy before qualification week (QW)

so that your employer avoids paying SMP when otherwise you would have qualified – you are treated as still working for your employer in your QW. Your employer will automatically become liable to pay your SMP.

If this happens to you, apply to the Inland Revenue officer at your local National Insurance Contributions Office within six months of the first day on which SMP was due.

If you are dismissed or made redundant before your QW for any other reason, you will not get SMP but you may be able to claim Maternity Allowance instead.

Statutory Maternity Pay when you work during maternity leave

Working for your normal employer

You cannot receive SMP from your employer for any week in which you work for them before or after your baby is born. If you do, you will lose one week’s SMP for each week even if you just work for one day during that week. You lose SMP at the lower rate first, even if you are within the first six weeks of the SMP period.

Working for other existing employers

If you have two or more employers while you are pregnant you can claim SMP from each of them, provided you satisfy the qualifying conditions for each job. You can choose separately when to stop work and start your maternity leave and SMP, from each job.

Each entitlement to SMP is treated separately so you can do some work for one or more of your existing employers during the SMP period (whether before or after your baby is born) and still get SMP from the other employer(s) for whom you are not working.

Working for a new employer

Before your baby is born you can work for a new employer and receive wages, and still get SMP from your normal employer up to the birth.

After your baby’s birth, if you do some work for a new employer, your normal employer’s obligation to pay you SMP ends and will not start again even if you stop work. However, if your ‘new’ employer already employed you in your qualifying week but does not have to pay you SMP, you can work for that employer after the birth and still get SMP from your original employer.

Contractual Maternity Pay (CMP)

Contractual Maternity Pay is any additional amount you receive from your employer above the Statutory Maternity Pay level. CMP cannot be less generous than SMP.

If your employer pays you CMP, check your contract to see whether there are any repayment conditions if you decide not to return to work after maternity leave. If you are required to repay your CMP, you need only repay the amount over and above SMP, as SMP is never repayable.

Maternity Allowance

Maternity Allowance (MA) is available from Jobcentre Plus for women who are pregnant or have just given birth. If you are not entitled to SMP for any reason, you may qualify for MA.

Maternity Allowance rates

MA is paid at a standard rate of £100 per week, or 90 per cent of your average earnings, if this is less than £100.

Maternity Allowance period

The earliest that MA can be paid is 11 weeks before your baby is due but you can carry on working until your baby is due without losing MA.

Start date for Maternity Allowance

The earliest you can stop is 11 weeks before your baby is due but you can carry on working right up until the week your baby is due, if you want to, without losing any MA.

If your baby is born before you had planned to stop work, your MAP will start on the day after the birth.

If you are off sick for a pregnancy-related reason within the last four weeks of your pregnancy, your employer can trigger your maternity leave. In that case your MA will start on the day after your first day of sick leave. The same rule applies if you are self-employed and have a pregnancy-related illness in the four weeks before your due date.

If you are unemployed, your MAP will automatically start on the Sunday after you are 29 weeks pregnant.

End date for Maternity Allowance

MAP will always end 26 weeks after it has started.

Employment during your Maternity Allowance Period

will disqualify you from receiving some of your MA. Jobcentre Plus will decide on the length of the disqualification that is reasonable in the circumstances. If you do just the odd day’s work, the disqualification should be limited to the number of days you actually worked.

Qualifying for Maternity Allowance

Employment conditions for Maternity Allowance

You do not need to be working currently, but may be continueing to work in order to satisfy the qualifying conditions for payment.

You must have worked for 26 weeks during the 66 weeks, the ‘test period’, immediately before the week in which your baby is due, the EWC. You do not need to have worked for 26 weeks in a row or worked whole weeks.

To find your test period, find the Sunday at the start of your EWC, or your due date if that is a Sunday, and count back 66 Sundays from there.

Your work could be a mixture of employed and self-employed. You may have changed jobs during your pregnancy, and may have earned a small amount from each. Any week in which you have done some work will count.

Earnings condition for Maternity Allowance

You must have average weekly earnings at least equal to the Maternity Allowance Threshold (MAT) in force at the beginning of your test period. The MAT is curently £30 a week.

Your earning are averaged over any 13 weeks in the test period. They do not have be in a row and you may choose the weeks with the most earings to help you get more MA. Earnings from all jobs and deemed earnings from self-employment may be used.

To work out your average earnings:

find the 13 weeks during the test period when you earned the most, including earnings from more than one employer;
add together all your earnings received in those weeks; and
divide by 13.

If the average is £30 or more, you will be entitled to MA. If not, you might be entitled to Incapacity Benefit instead.

Self-employed NI contributions and Maternity Allowance

If you are self-employed, for any week coverd by a Class 2 NI contribution you will be treated as having earnings sufficient to result in the standard rate of MA, payable at the end of each week covered by a class 2 NI contribution. If you have paid Class 2 contributions in each week in your 13 week period, you will get standard rate MA of £100.

If you hold a small earnings exceptiopn certificate, you will be treated as having earnings equal to the MAT at the end of any week coverd by your certificate. If you have been covered by a small earnings exception certificate in your 13 week period, you will get MA at 90 per cent of your average earnings; this is £27 a week.

Claiming Maternity Allowance

Complete form MA1 at least 14 weeks before your EWC. Send it to your local Jobcentre Plus/social security office with your MATB1.

Claim as soon as you can, even if you are still at work or if you do not have any medical evidence or any other information needed to complete your claim form. You can send it later.

Do not delay your claim. If you claim more than three months after the start of your Maternity Allowance Period, you will lose money.

Jobcentre Plus will decide if you qualify and will write confirming how much MA you are entitled to, or to give you the reason why you do not qualify.

You do not qualify for Maternity Allowance

If you are told that you do not qualify for MA but you think the decision is wrong, ask Jobcentre Plus to reconsider your claim, or you can appeal to an independent Tribunal within one month of their decision.

If you do not qualify for MA, Jobcentre Plus will automatically review your application to see whether you might be entitled to Incapacity Benefit.

Incapacity Benefit

Incapacity Benefit (IB) is available to women who are unable to work because they are pregnant or have recently given birth, as well as to women who are unwell. It is paid at £54.40 per week for the six weeks before and two weeks after your baby is born.

IB is available to women who have been disallowed for MA as long as the qualifying conditions for benefit have been satisfied. It is paid for six weeks before the EWC and for 2 weeks after your baby is born.

Qualifying conditions for Incapacity Benefit

You must have paid NI contributions for at least one year in the past three years. You must also either have paid or been credited with contributions during the other two out of three tax years immediately preceding the claim.

Claim period for Incapacity Benefit

IB can continue to be paid if you are unable to go back to work because you are sick.

You must send in your medical certificate to continue your IB. You must also send in your medical certificate if you have finished receiving Maternity Allowance or Statutory Maternity Pay but are sick and not entitled to Statutory Sick Pay, and wish to claim Incapacity Benefit.

Always remember, if you have a problem about exercising your rights, the quickest and most effective way to resolve an issue is to speak with your employer, and to seek specialist advice before considering formal action.