Statutory Maternity Pay helps employees financially during maternity leave. It provides up to 39 weeks of payment, with the first six weeks at a higher rate. Many employers offer enhanced maternity pay as part of their benefits package.
Eligibility Requirements
To qualify for SMP, employees must have worked for their employer continuously for at least 26 weeks by the end of the qualifying week (15 weeks before the due date). They must earn on average at least the Lower Earnings Limit and give proper notice.
Payment Rates
SMP is paid for up to 39 weeks. The first six weeks are paid at 90% of average weekly earnings with no cap. The remaining 33 weeks are paid at the lower of 90% of earnings or the flat weekly SMP rate set by the government, whichever is lower.
Employer Recovery
Employers can recover most SMP costs from HMRC. Small employers (those paying Class 1 NI of £45,000 or less in the qualifying tax year) can recover 103% of SMP paid. Other employers recover 92%. Recovery happens through reductions in PAYE payments to HMRC.