Posted: Wed May 02, 2007 6:32 pm Post subject: Working During Maternity Pay Period
Hi, I have a question regarding payment of SMP where and employee works during the Maternity Pay Period. Assuming the employee has already used the 10 KIT days and works another day. The rules seem clear that SMP is not paid for that week.
However, I seem to remember some special case (prior to KIT days) whereby, if an employee works during the first six weeks they only lose the Standard Rate and not the Earnings Rate. I cannot find any mention of this.
I may be looking too hard at this because the HMRC document 'Payroll Software Specification on Statutory Maternity Pay' seems to imply that the employee loses a week at Standard Rate (as per my thoughts above). Therefore, in the first six weeks you take Standard Rate off Earnings Rate and after the first six weeks this calculation will result in zero pay. It then though seems to have an exception for employees who are capped below standard rate due to low earnings; in this case, I am reading it as though they do not lose anything!
The point in question is:
c. Establish MPP_End_Week(n) and the SMP due in each week: Where the day(s) worked during a MPP week is not a KIT day, then no SMP is due for that week. If MPP_work > MPP_End_Week(n) or <=MPP_End_Week(n) to date >= (Earnings_Rate x 6) then SMP due-Standard_Rate UNLESS Standard_Rate > Earnings_rate where SMP due Earnings_Rate.
Just an update on this question. I have found a printed copy of the 'Payroll Software specification on Statutory Adoption Pay' that a colleague had. It makes it much clearer in that (although the current online on is different). I am now happy that if they work (not KIT day) then they lose a weeks SMP/SAP.
Although I still have some recollection of the first six weeks you only lose Standard Rate not Earnings Rate. Can anybody else remember that ruling? And has that now changed? Although I guess that with the 2 weeks compulsory leave then 10 KIT days it would be very unlikely that an employee would work (non KIT day) in the first six week anyway.
Posted: Wed May 09, 2007 10:00 am Post subject: Working during maternity pay period
The principle of losing a week's pay at the lower rate, even during the first six weeks of the MPP, is well established although there does not appear to any statutory basis for it. I have included it in all of the guidance that I have written.
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