Maternity pay

Statutory maternity pay (SMP) is paid for no more than 39 weeks. It will usually cover the first 39 weeks of maternity leave. It is payable when the employee is not at work because of her pregnancy or because she has given birth.

Qualifying for SMP

An employee qualifies for SMP provided she has:

• At least 26 weeks' continuous employment with you up to and including the date of the 15th week before the expected week of childbirth (EWC) - the 'qualifying week'
• Average weekly earnings (AWE) at or above the lower earnings limit for National Insurance contributions (NICs) that applies at the end of the qualifying week
• Given you medical evidence of her pregnancy (a form MAT B1) or a document giving the same information as the MATB1 issued by her midwife or GP. This form can only be issued from the 21st week of pregnancy
• Given you 28 days' notice of the date from which she wants to start her SMP. If she is entitled to statutory maternity leave (SML) she can give you this notice at the same time as her notice for SML. If it was not reasonably practicable for the employee to give you this notice in time then it should be given to you as soon as possible.

She must also be:

• An employed earner, i.e. an employee or office holder (someone working as a director of a company)
• Liable to pay secondary Class 1 NICs on her wages or salary

Although this specifically covers employees, an agency worker can also be eligible for SMP even if she is not eligible for maternity leave.

If the employed earner has more than one employer, she may be able to claim SMP from each one.

Failing to qualify for SMP

Self-employed women who do not qualify may be able to claim maternity allowance.

Women who work in an unpaid capacity in the business of a self-employed spouse or civil partner can receive a weekly maternity allowance. This will be payable for a maximum of 14 weeks.

You must give your employee form SMP1 (which is available from HM Revenue and Customs) stating the reason why you cannot pay her SMP. Form SMP1 is required to support your employee's claim to maternity allowance. You must also give the employee her original medical certificate or MAT B1 form back. You can keep a copy for your records.

If there is a dispute between you and the employee over whether she should be paid SMP, then you can refer it to HM Revenue and Customs to make a formal decision.

If the employment comes to an end

If a qualifying employee's employment ends after the start of the 'qualifying week' (the 15th week before her EWC) but before you start paying her SMP, you must still pay it. This also applies if her employment ends during the SMP period.

These rules apply regardless of whether her employment ends voluntarily, e.g. she resigns, or because you dismiss her.

You cannot pay SMP for any week during which an employee works for you if she has already worked ten keeping-in-touch days within the SMP period.

If an employee returns to work, but then for any reason she has to stop work and she is still in her SMP period, you must start paying her SMP again.

Ending SMP payments

You can stop paying SMP if an employee:

• Dies
• Is taken into legal custody by the police, e.g. is arrested and/or in prison
• Starts working for another employer after the birth

SMP rates

SMP is payable at a rate of 90% of the employee's AWE for the first 6 weeks. There is no upper limit. The remaining 33 weeks are paid at either:

• The standard weekly rate (see GOV.UK for the current rate); or
• 90% of her AWE if this is lower than the standard weekly rate.

You can calculate the maternity pay on GOV.UK.

You can, if you wish, offer enhanced maternity pay arrangements to attract and retain employees. For example, you could:

• Pay more than SMP over a certain period, e.g. full pay for the first 6 weeks, half pay for the next 10 weeks, SMP for the remaining 23 weeks
• Make a bonus payment on the employee's return to work

You could change the qualification criteria for these enhancements, e.g. the employee needs a year's continuous service. You can offer these arrangements as a contractual right. If you offer them on a discretionary, case-by-case basis, you must act reasonably and comply with legislation aimed at tackling discrimination. You should be aware the arrangements may become contractual through 'custom and practice'.

Recovering SMP payments

You can recover 92% of your SMP payments from HM Revenue and Customs.

However, if your total annual National Insurance payments are £45,000 or less you can recover 103%.

You can also recover the SMP portion of any enhanced maternity pay from HM Revenue and Customs.