SMP and deductions...

[baffledmum]

I use a salary sacrifice / exchange scheme at work. My family are covered for dental and medical insurance through the scheme, for which a deduction is made through my monthly salary. When I go on mat leave does my employer have to cover the cost of their cover as well as mine? There is no suggestion that they are stopping my cover but I understand I may be asked to give a cheque to cover my family. Does anyone know the legal position on this?

[ecuse]

My employer picked up the cost for salary sacrifice things but I'm not sure whether that was legally required other just goodwill so not much help, sorry. Your HR person ought to know?

[baffledmum]

They have suggested a cheque or cancellation....

[YoullScreamAboutItOneDay]

It's not salary sacrifice is it? Isn't that only pensions and childcare vouchers.

They have to continue your benefits. However, anything you pay for yourself, you can be required to continue to pay for. That is because it isn't a benefit as such, they are just allowing you a mechanism to pay for it yourself.

Salary sacrifice is different because of the way it works. The reduce your salary and in return you get a benefit. That's technically different from deducting money from your salary to pay for something you choose to purchase.

[flowery]

Loads of benefits can be provided via salary sacrifice.

If your employer provide a contractual non cash benefit of dental/medical insurance via a salary sacrifice scheme (or otherwise), they must continue to provide that benefit throughout maternity leave. It's a contractual benefit they are providing you, although your family are benefiting from it also.

HMRC guidance here is pretty comprehensive.

[YoullScreamAboutItOneDay]

Didn't know that. Thanks Flowery.

As Flowery has said, essentially, if it is salary sacrifice, you get it. If it is a benefit (i.e. they pay for it usually), you get it.

If it is just a deduction - e.g. we pay for any medical insurance for family members and they deduct it from salary for convenience- you don't.

[ChunkysMum]

I have also been asked to pay back childcare vouchers that were provided as part of a salary sacrifice scheme. If the details of the problems I've been having regarding this issue are helpful to you, you can read them here (sorry it's long)

Although the HMRC guidance is pretty clear, my large employers disagree, so I am in the process of raising a grievance.

Hopefully, they will just continue to give you the benefits that you are entitiled to. Good luck with it.

[baffledmum]

I have been advised by HR that if an employer operates a salary sacrifice scheme then all benefits provided for through that must be continued while a woman is on mat leave. When the employee is on statutory payments or unpaid leave then the employer meets the cost, including when those benefits extend to family members. This includes pension contributions although as things stand there is a grey area on whether pension contributions have to continue once someone reaches the 39th week of mat leave & goes onto unpaid. My employers salary sacrifice scheme includes childcare vouchers, a ride to work scheme, travel insurance and dental cover plus many others.

Clearly the risk is that someone uses the lifestyle window that may be opened when they go on mat leave to ramp up their benefits but that's the risk employer's take and most will have assessed it.

Good luck with your grievance Chunkysmum. Your employer is wrong if they have been deducting from your SMP or maternity allowance.

To be clear, if you are in receipt of enhanced contractual maternity pay then an employer can make deductions from that, and an employer can make deductions from any pay you receive for KIT days.

I have a good employer who will be honouring the salary exchange scheme rules.