16-07-2008
Changes to maternity benefits to affect SMEs
News from Calculated Risks Limited
After some improvements were made to maternity benefits last October there is still some confusion over the situation concerning pension contributions that employers need to be aware of.
Those employees whose babies were due on or after 5 October 2007 have benefited from the distinction between ordinary and additional maternity leave being removed with contractual benefits (excluding pay) continuing for the whole period; which they had not done previously.
The question of how long pension contributions should continue is now being challenged by legal experts and, if successful, pension benefits would have to continue for the whole of the maternity leave period whereas they are restricted at present to the first 39 weeks.
A government spokeswoman insisted the changes made to the SDA would not increase employers' costs. "When a woman is taking additional maternity leave but is not being paid, the employer is not required to make pension payments for her during this time." However we shall see where this will go!
