Maternity Pay and non-cash benefits

[lady_liv]

My employer and I appear to have reached deadlock on the issue of maternity pay and non-cash benefits. If anyone can answer the following queries, I would be eternally grateful!

 

1./ Are all salary sacrifice schemes classified as non-cash benefits? I (am not on mat leave until Monday 1st October) currently sacrifice £243 pcm for childcare vouchers and 6% of my salary (approx £122pcm) towards a pension scheme - employer matches this. As I understand, the whole 12% is counted as employer contributions and is classified as a non-cash benefit. I am not able to leave either scheme at will, there has to be either a lifestyle change, or I think I can leave the pension in April each year. Is this correct?

 

2./ Do non-cash benefits have to continue through the whole period of maternity leave, paid and unpaid?

 

3./ I receive some contractural pay (100% for 6 weeks and 50% for the next 12 weeks) - this is, obviously, available to be sacrificed - but my pay must not be reduced below SMP at any time.

 

4./ At no point during my mat leave is there enough contractural pay to cover the entire £365pcm salary sacrifice - does my employer have to make up the difference? For example, my monthly salary liable to Class 1 NI's is £1681.10pcm. This gives me an average weekly earnings of £388, which means in the first 6 weeks my SMP is £349.20 and contractural pay is £38.80. Therefore in October, a month containing 5 Mondays, I would expecting to receive gross pay of £1940 of which £1746 is SMP and £194 is contractural pay. What should happen with the childcare vouchers and pension payments?

 

5./ In the subsequent 12 weeks, my SMP is £135 per week and contractural pay is £59 per week. In a 4 week month this gives £236 of contractural pay and in a 5 week month this would be £295 - again, not enough to cover the £365 sacrifice. Again - I guess they take the entire contractural pay, but what about the extra bit?

 

We are both quoting the HMRC guidlines on this, but interpreting them differently. To complicate things, I was TUPE transferred into this company on 1st July this year, and the new company accepted the old companies maternity policy (which is based on the HMRC guidlines) and again, we are both quoting this and disagreeing.

 

Can anyone shed any light on this matter? A colleague of mine is in the same position, albeit already on maternity leave, and she will run out of time to file an employment tribunal claim on 26th October (3 months - 1 day since she was first paid incorrectly), so we really need to resolve this quickly.

 

They are saying that I cannot expect to be paid more on maternity leave than when I'm at work, but my opinion is that it is a transferring T&C anyway, and the HMRC guildines are that this is what happens and it's unfortunatley generous to the employee under this particular set of circumstances.

 

If I'm wrong, I will happily accept it, but I've read and reread the documents a number of times and I cannot see how they are reaching their interpretation.

 

Help?

 

Liv

[mariefab]

Are you using the HMRC guidance below?

 

http://www.hmrc.gov.uk/employers/sml-salary-sacrifice.pdf

 

If so, which example applies to you and what is your employer's argument?

[lady_liv]

yes, that's the document. I've been looking at the "occasional misundertandings" advice bits, specifically the one at the top of p22. And the linked table, section 2.

 

i'm not sure exactly what their argument is, am waiting for their official reply - but seems to be that they don't want to pay the extra during the period of contractural pay, they possibly seem to have accepted it for the bit where I'm on SMP only.

[mariefab]

In the terms of the salary sacrifice agreement; are 'lifestyle changes' actually defined?

 

i.e. Does it say something along the lines of, 'In the event of lifestyle changes, e.g.redundancy of partner, marriage of employee, pregnancy of employee or partner... etc. either the employer or the employer can change this agreement because of the change in circumstances.'?

 

Or does it just say something like, 'In the event of lifestyle changes this agreement can be amended by the employer.'?