Understanding Maternity Leave in the UK
In the UK, eligible female employees have the legal right to take up to one year of maternity leave. That's pretty astounding, considering some countries don't even offer maternity leave and pay.
According to UK law, the first 26 weeks are known as ordinary maternity leave. The succeeding 26 weeks are known as additional maternity leave.
Pregnant women must take a minimum of two weeks of maternity leave after giving birth. For factory workers, the minimum maternity leave period is four weeks.
Pregnant women can take maternity leave as early as 11 weeks before the expected due date of their baby.
If the baby is born early, the maternity leave begins the day after childbirth.
In case the child dies, female employees still qualify for statutory maternity leave and pay if the baby:
Is stillborn after the beginning of the pregnancy's 24th week; or
Dies right after birth.
This maternity leave comes with statutory maternity pay to support women and their families as they care for their newborns without facing financial hardship.
Statutory Maternity Pay vs Contractual Maternity Pay vs Maternity Allowance
"There is a wide discrepancy between organisations and what they offer can vary, so getting to know what you are entitled to from your employer as well as from the government (is essential)," elaborated Rebecca Robertson, an expert in female financial advice.
Understanding the different entitlements available to pregnant women is vital in making informed decisions.
Statutory Maternity Pay
Statutory maternity pay is an obligatory UK legal requirement. It can only be paid for up to 39 weeks of maternity leave, even if the leave is longer than 39 weeks.
Eligible for statutory maternity pay are female employees who:
Have been on an employer's payroll in the qualifying week, which is the 15th week before the expected week of childbirth;
Have been continuously employed by the same employer for at least 26 weeks up to any day in the qualifying week;
Have a gross weekly income of at least £123 in an eight-week relevant period;
Give an employer proper notice; and
Give an employer valid proof of pregnancy.
Special rules apply to female employees in unique situations, such as if they go on maternity leave or experience pregnancy-related illness before the qualifying week.
Statutory maternity pay entitles eligible employees to receive the following benefits:
90% of their average weekly earnings before tax for the first six weeks of maternity leave; and
£184.03 or 90% of their average weekly earnings before tax, whichever is lower, for the remaining 33 weeks.
The UK government sets these standard rates. Tax and National Insurance are deducted.
Contractual Maternity Pay
Anna, employed by a private company, is entitled to contractual maternity pay or occupational maternity pay, which the private sector can provide instead or on top of statutory maternity pay, during her paid maternity leave.
Under its maternity policy, a private company can offer to its eligible female employees more than the legal minimum or statutory amount.
Maternity Allowance
The two abovementioned shouldn't be confused with maternity allowance, the amount of which depends on a pregnant woman's eligibility.
Entitled to claim maternity allowance are pregnant women who:
Are employed but aren't eligible for statutory maternity pay, wherein the maternity allowance can be paid for up to 39 weeks;
Have stopped working recently;
Are self-employed, wherein the maternity allowance can be paid for up to 39 weeks; or
Do unpaid labour for the business of their spouse or partner, wherein the maternity allowance can be paid for up to 14 weeks.
Eligibility Requirements for Maternity Allowance
1) Pregnant women who are employed but aren't eligible for statutory maternity pay
Must've been employed for at least 26 weeks in the 66 weeks before the baby is due
Must have a weekly salary of at least £30 in at least 13 weeks, consecutive or not, of their employment
2) Pregnant women who have stopped working recently
Eligibility can be checked using the UK government's maternity entitlement calculator
3) Pregnant women who are self-employed
Must've been registered as self-employed for at least 26 weeks in the 66 weeks before the baby is due
4) Pregnant women who do unpaid labour for the business of their spouse or civil partner
Must've been involved in the business of their spouse or civil partner for at least 26 weeks in the 66 weeks before the baby is due
Must not have been employed or self-employed for at least 26 weeks in the 66 weeks before the baby is due
Their spouse or civil partner must be registered as self-employed and pay Class 2 National Insurance contributions for at least 26 weeks in the 66 weeks before the baby is due
The Bottomline
With options like statutory maternity pay, occupational maternity pay, and maternity allowance, knowing your entitlements as an expectant mother can make a significant difference in managing your finances while you're on maternity leave.
Exploring and maximising these benefits with your spouse ensures you can focus on caring for your newborn without worrying about financial strain.
How do you prepare for pregnancy and maternity leave? Knowing your entitlements under UK law, how do you plan financially for the arrival of a newborn? We'd love to hear from you, so feel free to share your thoughts below!
Read our next blog here to find out how we're preparing for Anna's one-year maternity leave.
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