Statutory Maternity Pay

Statutory Maternity Pay (SMP) is a payment provided by employers to expectant mothers who are employed and meet certain eligibility criteria. Employers have a legal obligation to provide SMP to eligible employees and it is a crucial aspect of providing a supportive and inclusive workplace. All employers can usually reclaim some if not all of the SMP that they pay to employees.

Eligibility Criteria

An employee must:

• Earn at least an average of £123 per week
• Have been employed continuously by the same employer for at least 26 weeks leading up to the due date

Calculation of SMP

SMP for eligible employees is paid for up to 39 weeks, the earliest it can start is from the 11^th week before the due date and is usually paid as follows:

• The first 6 weeks is paid at 90% of the employees average weekly earnings
• The remaining 33 weeks is paid at £156.66 or 90% of the employees average weekly earnings (whichever is lower).

Proof of Maternity

Employees must provide their employer with proof that they are pregnant before SMP can be paid. This is usually in the form of a MATB1 certificate which confirms the employee is pregnant and verifies the due date.

Employers must keep a record of the proof of pregnancy, and all pay related details including amounts and dates of payments made to the employee for a minimum of 3 years from the end of the tax year the payments relate to.

Reclaim SMP

All Employers can recover some if not all of the SMP paid to employees.   If an employer qualifies for Small Employers Relief (paid £45,000 or less in Class 1 National Insurance in the previous tax year), 103% of SMP can be reclaimed, otherwise you can recover 92%.  To reclaim SMP the employer can offset the amount to be recovered against their PAYE liability.

If we manage your payroll for you, we take care of the SMP payment calculations and automatically reclaim the applicable SMP on your behalf. To find out more about our payroll services, please contact Julie Hunter on 0131 317 7377 or email Julie.hunter@jsca.co.uk

Photo by Juan Encalada on Unsplash