Statutory Maternity Pay SMP and
Ordinary Statutory Paternity Pay OSPP
Statutory Shared Parental Pay ShPP

What normally applies:

• Overview and "qualifying week"
• The pivotal "qualifying week" is the 15th week before the expected week of childbirth.
• This is established with proof of pregnancy which midwives and doctors usually give 20 weeks before the due date of birth.
• Statutory Maternity Pay SMP is paid during maternity leave.
• The employee needs to advise the employer by the "qualifying week".
• Statutory Paternity Pay SPP is paid during paternity leave.
• Statutory Shared Parental Pay ShPP is dependant on Statutory Maternity Pay SMP also being claimed.

• Who qualifies
• Employees who have worked for the employer:
• For at least 26 weeks.
• Up to the the "qualifying week" - 15th week before the expected week of childbirth.
• Earnings qualification
• up to :
• They have earned an average of more than and
• from :
• They have earned an average of more than .
• This is the National Insurance Lower Earnings Limit NI LEL threshold.
• What the employee does:
• Tell the employer that they want to stop work to have a baby.
• Employee must give notice of least 28 days before the Statutory Maternity Pay SMP is to start.
• The employer can ask for this in writing.
• Employee must give proof of pregnancy.
• This may be:
• Doctor's letter or
• MATB1 certificate.
• Midwives and doctors usually give these 20 weeks before the due date of birth.

• What the employer does:
• Confirm within 28 days
• The amounts of Statutory Maternity Pay SMP
• When Statutory Maternity Pay SMP will start and stop.
• Or within 7 days of making an alternative decision:
• Advise that the employee is not eligible.
• What the payments are:
• Payments go with leave.
• Paid on the normal pay day.
• Statutory Maternity Pay SMP is paid for up to 39 weeks i.e. 9 months:
• First 6 weeks - 90% of average weekly earnings AWE
• From ; Next 33 weeks the lower of:
• or
• 90% of average weekly earnings AWE
• Up to
• Tax and National Insurance is deducted.
• Holiday pay entitlement - weeks of Statutory Maternity Pay SMP count towards holiday pay.
• Three quarters of a year of holiday pay entitlement will accrue during the full nine months i.e. 39 week period.
• The employee can work up to 10 days, Keeping in Touch KIT days without losing Statutory Maternity Pay SMP entitlement.
• Otherwise it ends if returning to work before the end of the 39 weeks.
• Amounts are payable even if the employee leaves the employment.
• But not after starting a new employment.
• Unless the employers are associated:
• By takeover of the business or
• Ownership.
• Statutory Maternity Pay SMP starts with leave or
• Pregnancy-related illness in the 4 weeks before the expected date of childbirth.

What are the payroll calculations?

• Normally
• Payable on the 7th day after commencement of the payments.
• Weekly paid due in the week in which this day falls.
• Monthly paid in the month in which these days fall.
• This means that the employee may be paid:
• Probably an odd number of weeks in the first and last month.
• Mostly 4 weeks in each calendar month .
• Sometimes 5 weeks in a calendar month .
• It may be helpful for the employer to provide a schedule of prospective payments with the first Statutory Maternity Pay SMP payment;
• bearing in mind that payments could be cut short by a change of employment circumstances with the employee.
• Where we are preparing your payroll we will normally pay in exact weeks, and 4 or 5 weeks in a month as applicable.
• Or Pro rata
• The employer may agree to pay amounts pro rata:
• i.e. an odd number of days in the first and last week or the first and last month.
• But this adds an additional layer of complication.
• Particularly to monthly pay because of the varying number of days in each month.
• It is far easier to calculate and agree 39 weeks than 273 days.
• Payments in advance - lump sum payments
• The employer may agree payment in advance
• but runs the risk of irrecoverable over-payment if there is a change of employment circumstances with the employee.

Average weekly earnings AWE are:

• What the actual pay slips say
• Total gross pay,
• Before deductions,
• For the eight weeks preceding the start of applicable pay:
• Statutory Maternity Pay SMP.
• Ordinary Statutory Paternity Pay OSPP.
• Statutory Shared Parental Pay ShPP.
• For monthly paid this may be parts of three monthly pay slips.
• Gross pay includes:
• Sick pay,
• Overtime,
• Bonus payments,
• Arrears of pay,
• Holiday pay.
• HM Revenue & Customs consider manipulation of Bonus or other payments, to increase Average weekly earnings AWE, an abuse of the system.

Employer's Recovery:

Statutory Maternity Pay SMP continues to be recoverable by the employer even though Statutory Sick Pay SSP, paid from 6th April 2014 onwards, is not recoverable.
Deducted from PAYE/NI paid of:
Statutory Maternity Pay SMP and
Ordinary Statutory Paternity Pay OSPP - see details below and
Statutory Shared Parental Pay ShPP - see details below.

• Two levels of repayment:
• Regular Employer Relief or
• Small Employer Relief
• Regular Employers have National Insurance payments over £45,000 in the latest tax year.
• National Insurance payments are:
• The total of:
• Employees National Insurance and
• Employer's National Insurance contributions.
• The latest tax year is:
• The last complete tax year, to 5th April.
• before the the "qualifying week".
• employee's 15th week before the week the baby is due.
• Regular Employer Relief:
• 92% of Statutory Maternity Pay SMP paid.
• Small Employer Relief:
• 103% of Statutory Maternity Pay SMP
• The extra 3% compensates is for employer's National Insurance payable on Statutory Maternity Pay SMP.
• Where we are preparing your payroll the recovery of SMP, OSPP, ASPP calculations are already made within the service; automatically recovering SMP, OSPP, ASPP as you pay your PAYE/NI contributions.
• Using your own purchased payroll software, the calculations may be included.
• The software needs to be set to Regular Employer Relief or Small Employer Relief as applicable.
• File an Employer Payment Summary EPS with HMRC to achieve the set-off against your PAYE/NI liabilities.
• Set-off also applies against Construcion Industry Scheme CIS liabilities.

• What leave qualifies
• For leave taken:
• between the date of birth and
• 56 days, i.e. 8 weeks, after the date of birth
• Who qualifies - as for Statutory Maternity Pay SMP
• Employees who have worked for the employer:
• For at least 26 weeks
• Up to the the "qualifying week" - 15th week before the expected week of childbirth
• Who qualifies - additionally for Ordinary Statutory Paternity Pay OSPP
• Be employed up to the date the child is born.
• Be taking time off to look after the child.
• Be responsible for the child's upbringing.
• Be the father or partner of the mother.
• Earnings qualification - as for Statutory Maternity Pay SMP:
• up to :
• They have earned an average of more than .
• from :
• They have earned an average of more than , and
• This is the National Insurance Lower Earnings Limit NI LEL threshold.
• What the employee does:
• Give the correct notice by the "qualifying week" at least 15 weeks before the week the baby is expected.
• Employees may use form SC3 Ordinary Statutory Paternity Pay/ordinary paternity leave - becoming a parent to request leave and pay.
• Must give 28 days notice of when they want Ordinary Statutory Paternity Pay OSPP to start using form SC3.

• What the employer does:
• Confirm within 28 days:
• The amounts of Ordinary Statutory Paternity Pay OSPP.
• The two applicable weeks.
• Or within 28 days of making an alternative decision:
• Advise that the employee is not eligible using form OSPP1 Non-payment of Ordinary Statutory Paternity Pay (OSPP).
• What the payments are:
• Payments go with leave.
• Paid on the normal pay day.
• Ordinary Statutory Paternity Pay OSPP is paid for 2 weeks:
• the lower of:
• From or
• 90% of average weekly earnings AWE.
• Up to
• Tax and National Insurance is deducted.
• Holiday pay entitlement - weeks of Ordinary Statutory Paternity Pay OSPP count towards holiday pay.

• Share Statutory Maternity Pay SMP but both partners must qualify
• What leave qualifies:
• 2 to 26 weeks
• Starting from 20 weeks after the date of birth
• Finishing on the baby's first birthday.
• Who qualifies - as for Statutory Maternity Pay SMP
• Employees who have worked for the employer
• For at least 26 weeks
• Up to the the "qualifying week" - 15th week before the expected week of childbirth
• Who qualifies - additionally for Statutory Shared Parental Pay ShPP:
• Be employed up to the start date of Statutory Shared Parental Pay ShPP.
• Employee whose partner has returned to work
• And whose partner has at least two weeks of Statutory Maternity Pay SMP entitlement unclaimed.
• Earnings qualification - as for Statutory Maternity Pay SMP:
• up to :
• They have earned an average of more than , and
• from :
• They have earned an average of more than .
• This is the National Insurance Lower Earnings Limit NI LEL threshold.
• What the employee does:
• Give the correct notice by the "qualifying week" at least 15 weeks before the week the baby is expected.
• Give 8 weeks notice using form SC7 Additional Statutory Paternity Pay and Additional Paternity Leave - becoming a parent.
• Employee and partner complete and sign the same form.

• What the employer does:
• Confirm within 28 days
• The amounts of Statutory Shared Parental Pay ShPP
• When Statutory Shared Parental Pay ShPP will start and stop.
• Or within 28 days of the request, an alternative decision:
• Advise that the employee is not eligible and include form ASPP1 Non-payment of Additional Statutory Paternity Pay (ASPP).
• The employer may ask for:
• A copy of the birth certificate.
• Contact details of their partner's employer to check when their partner's Statutory Maternity Pay SMP ends.
• This needs to be supplied by the employee with 28 days or
• if not supplied the employee will not qualify.
• What the payments are:
• Payments go with leave.
• Paid on the normal pay day.
• Statutory Shared Parental Pay ShPP is paid for 2 to 26 weeks.
• lower of:
• From per week or
• 90% of average weekly earnings AWE
• Up to per week .
• Tax and National Insurance is deducted.
• Holiday pay entitlement - weeks of Statutory Shared Parental Pay ShPP count towards holiday pay.