Statutory Payments

There are a number of statutory payments that your employees may be entitled to. These can be due if someone’s become a parent, are off work sick or are laid off.

We are going to cover statutory payments for parents and for sick pay. To qualify for statutory payments, the individual must be an employed earner, ie someone working for an employer who is liable to pay secondary Class 1 National Insurance contributions on their wages.

Statutory Sick Pay:

Employees can get £92.05 per week Statutory Sick Pay (SSP) if they're too ill to work. This is payable for up to 28 weeks.

SSP is just payable for days your employees would usually work. Its not payable for the first three days of sickness, unless the employee has been paid SSP within the last 8 weeks.

To be eligible for SSP the person must be classed as an employee and have done some work for you as an employer. They also need to have been ill for at least 4 days in a row, and earn an average of £116 before tax each week.

They also must tell you as their employer that they’re sick within 7 days if you don’t have a preset deadline or by your deadline if there is one in place.. This can just be a phone call in the morning to let you know that they won’t be in that day!

Employees also only have to give you a doctors note if they have missed more than 7 days work.

SSP is not reclaimable from the government so is funded by you as an employer.

Statutory Maternity Pay:

Statutory Maternity Pay (SMP) is paid for up to 39 weeks.

To be eligible for SMP a number of conditions must be met.

Employees must earn on average at least £116 a week, give you the correct notice and give proof of pregnancy. Employees must have also worked for you continuously for at least 26 weeks continuing into the ‘qualifying week’ - the 15th week before the expected week of childbirth.

SMP is paid at two different rates, for the first 6 weeks it is paid at 90% of average weekly earnings. The remaining 33 weeks are paid at £145.18 or 90% of average weekly earnings (whichever is lower).

SMP is paid in the same way as wages (for example monthly or weekly). Tax and National Insurance will be deducted.

To calculate average weekly earnings, gross earnings will be averaged over a period of at least eight weeks up to and including the last payday before the end of the “qualifying week”. The “qualifying week” is the 15th week before the week the baby is due. This period may vary depending on how often someone is paid – weekly, monthly or other intervals.

Employees are entitled to 10 keep in touch days while being paid maternity leave. These are days where an employee can return to work for full pay but continue to be paid SMP. They are usually used to help employees transition back into full time work, or to have meetings regarding important matters.

There are also a number of additional points to consider with SMP around salary sacrifice arrangements and pay rises. The rules around these areas can be a bit tricky so if you are aware of an employee claiming SMP who might be affected by pay rises or salary sacrifice arrangements let us know and we will provide specific advice for them.

There is also shared parental leave to consider when thinking about SMP, which we will cover in a future post!