Valerie Bond
Posted on 25 Aug 2020

Statutory Maternity Pay – Update

The Labour Party recently stated that many women may have been wrongly sent home on statutory sick pay during Covid-19 when, in fact, they should have remained on full pay in accordance with the rules surrounding maternity suspension. This article looks at the laws around sick pay, maternity pay, and when and how they should be paid.

Overview of Statutory Maternity Pay

Statutory Maternity Pay (SMP) is available to eligible women for up to 39 weeks. To be entitled to SMP, an individual must meet the relevant qualifying conditions in the 15th week before the baby is due (the "qualifying week"). This includes continuous employment of a minimum of 26 weeks with the same employer.

For the first 6 weeks of maternity leave, SMP is paid at 90% of the woman's gross average weekly earnings. After this point, it is paid at the standard rate of £151.20 per week, or at the 90% figure, whichever is lower.

Overview of Pregnancy Suspension under Management of Health and Safety at Work Regulations 1999

Employers must assess the workplace risks for pregnant employees. If the job poses a risk for the pregnant employee, then the employer should consider whether it is possible for the pregnant employee to be deployed elsewhere, have their duties changed, or whether they can work from home. If this is not possible, which has been the case for many pregnant women during the COVID-19 pandemic, then the employer must suspend the pregnant employee from work on full pay for as long as necessary.

The impact of Covid-19 on pregnant women

When lockdown was first announced back in March, pregnant women were listed in the clinically vulnerable category. For many of those who could not work from home, or have their duties amended, this meant being sent home due to potentially unsafe working environments. However, it has recently come to light, following research conducted by the Labour party, that many of those women may have been incorrectly receiving Statutory Sick Pay (SSP), rather than their full income under the pregnancy suspension rules, above.

Not only does this mean that many women were being paid less than their entitlement during that period, it also means that many may have ended up missing out on SMP. This is because to qualify for SMP, pregnant women must have earned at least £120 a week on average during an eight-week lead-up period to their maternity leave. SSP only pays £95.85 a week, meaning that, if women were entitled to SSP only for 8 weeks or more, they would no longer qualify for SMP.

Amends to Statutory Maternity Pay during Covid-19

In April 2020, new regulations came into force to deal with the calculations of "normal weekly earnings" for family leave pay purposes where recipients were on furlough leave. This meant that pregnant women and expectant fathers could still qualify for maternity or paternity pay if they had been furloughed and, therefore, their pay had fallen below the required £120 per week, technically dis-entitling them to SMP or equivalent. The entitlement of expectant parents would instead be based on their non-furlough salary, ensuring that access to statutory family leave pay would not be prejudiced by the imposition of furlough.

However, the new regulations did not safeguard the position of those individuals placed on SSP prior to a period of family leave, meaning that many pregnant individuals, who had been sent home on SSP, would now be facing a lack of entitlement to SMP.

Risk of Discrimination?

Navigating employment law in the world of COVID-19 has been no easy feat. Many employers may well have sent home pregnant employees with the best of intentions, not realising their obligations under the Pregnancy Regulations and the Maternity Protection Acts 1994 and 2004 and only paying SSP. Little did they realise that this may also have an impact on their employees' entitlement to receive SMP when the time to take maternity leave comes along.

Lockdowns and Tribunal backlogs have meant that claims relating to COVID-19 have been largely untested in the Tribunals to date. However, there is clearly potential for claims of discrimination in cases where pregnant employees have lost out on pay.

How to deal with potential issues

Particularly now that the Labour party has highlighted the possible errors which have been made in respect of payment to pregnant employees, employers may well be on the receiving end of queries and potential complaints about the same. Given the fraught issues with litigation, and the fact that it may take many years for the Tribunal backlog to be cleared, the most commercial way forward for businesses will always be to try to agree a financial and/or practical solution with the employee in question. COVID issues are adding an extra layer of strain onto businesses and, therefore, it is important to try to resolve any issues promptly, before they cause further disruption.

This article is for information purposes only and is not a substitute for legal advice and should not be relied upon as such. Please contact Rachael Lloyd or Valerie Bond to discuss any issues you are facing.