Types of Parental Pay

Jan 13, 2024 - 17:09
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Types of Parental Pay

In the modern workplace, understanding the nuances of parental pay is essential. Whether you are an employer navigating the complexities of statutory payments or an employee planning to take parental leave, being well-informed can help you make the best decisions. Here, we delve deep into the intricacies of parental pay, covering various aspects including maternity, paternity, and adoption leaves, shared parental leave, and the newly introduced parental bereavement leave. Let’s embark on this informative journey:

Maternity Leave and Pay

Expectant mothers are entitled to up to 52 weeks of Statutory Maternity Leave surrounding the birth of their baby, with a mandatory two-week leave post-birth. The eligibility for Statutory Maternity Pay (SMP) depends on the length of employment and earnings. Here are the key points for this type of parental pay:

  • Qualifying Week: The 15th week before the expected due date, typically around the 25th week of pregnancy.
  • Earnings Threshold: Average weekly earnings of £123 or more, calculated over the 8 weeks leading up to the qualifying week, for the 2023/24 period.
  • Payment Structure: 90% of average weekly earnings for the first six weeks, followed by the lower of 90% of average weekly earnings or £172.48 per week for the remaining period.
  • Recovery of Payments: Employers can reclaim a significant portion of the SMP paid, with additional benefits for small employers.

Paternity Leave and Pay

Fathers or partners can avail of Statutory Paternity Leave and Pay under certain conditions, which are somewhat similar to the criteria for SMP. The highlights are:

  • Leave Duration: One or two consecutive weeks within 8 weeks of the child’s birth or adoption placement.
  • Payment Amount: The lower of 90% of average weekly earnings or £172.48 for the 2023/24 period.
  • Eligibility: Continuation of employment until the child’s birth and responsibility for the child’s upbringing.

Adoption Leave and Pay

Adopting parents have rights similar to those expecting a baby. The primary adopter can claim Statutory Adoption Pay (SAP) and leave, while the other partner might be eligible for paternity benefits. The key aspects are:

  • Leave Duration: Up to 52 weeks, with a minimum of 2 weeks mandatory leave.
  • Payment Structure: Similar to SMP, with 90% of salary for the first six weeks and a maximum of £172.48 per week thereafter.
  • Proof of Adoption: Necessary for claiming SAP, including details of the adoption agency and placement dates.

Shared Parental Leave and Pay

Introduced in April 2015, this provision allows parents to share leave and pay in the first year after the child’s birth or adoption. It offers flexibility in planning leave periods and sharing the parental pay. Here’s what you need to know:

  • Eligibility: Both parents must meet specific employment and earnings criteria.
  • Flexibility: Allows parents to take leave in separate blocks, interspersed with periods of work.
  • Payment: Maximum of £172.48 per week or 90% of average weekly earnings, whichever is lower, for up to 37 weeks.

Parental Bereavement Leave and Pay

Since April 2020 in Great Britain and April 2022 in Northern Ireland, employees grieving the loss of a child are entitled to Statutory Parental Bereavement Leave and Pay. The details are:

  • Leave Duration: One or two weeks, which can be taken as a single block or two separate blocks.
  • Payment: £172.48 per week or 90% of average earnings, whichever is lower, for those with at least 26 weeks of service.

Recovery of Payments and Record Keeping

Employers can recover a portion of the statutory parental payments from HMRC, with additional benefits for small employers. Proper record-keeping of payments and necessary certificates is essential.

Further Assistance

For detailed guidance and assistance on various parental payments and leaves, employers and employees can refer to the official GOV.UK website or consult with ACAS.

Additional information can be found here.

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