childcare vouchers & mat leave

(46 Posts)
MrsRV Fri 03-Jan-14 20:21:48

umm... so, I've just found out I can still claim childcare vouchers while on mat leave without it affecting the statutory maternity leave I'll recieve? is this correct? despite working for a law firm, I know I'll have to fight to get this if it's correct so need to be sure of my facts... if anyone could help I'd be grateful.

theborrower Sat 04-Jan-14 14:57:38

Yes, I also want to keep DD in nursery, though we may drop her from 3 to 2 days. She's in the preschool class and I don't want her to miss out. I can't move her to a (free) school pre-school for during mat leave because I'll be back at work for a few months before she starts school and they don't run during summer (and have completely impossible hours for working parents anyway), so wound need to put her back in private nursery.

mamapants Sat 04-Jan-14 14:59:08

diddle that isn't true, your employer would have to fund the childcare for the relevant period not the government.

Your employer does have to fund them during SMP as they can't deduct the money, but your maternity pay will be calculated on your lower pay, unless you opt out during the relevant weeks as explained above.
I have opted out during weeks 17-25 and will be cancelling before I go off on ML as I won't be using childcare while on leave. Its best to work it out on different scenarios to see what is best for each person.

sleeplessbunny Sat 04-Jan-14 15:22:10

This is all news to me and sounds very complicated. I am now 28wks with DC2 and still buying vouchers for DC1. I had just assumed the amount would continue to be deducted from any maternity pay as normal, assuming there was enough pay to cover the deductions. What am I reading here implies that when you're being paid SMP, the employer has to fund the whole cost of the vouchers, is that right? It seems rather odd to me, but I have never thought to check the rules.

I am lucky to have enhance mat pay from my employer for the 1st 18wks so I expect the vouchers will be deducted as normal during that period, but when I go onto SMP is this something I should be watching for? We are keeping DC1 in childcare so the vouchers will still be necessary.

MrsRV Sat 04-Jan-14 16:35:35

ok so, i've missed the opting out period (i am 22 weeks) so my stat mat pay will be calculated on my reduced earnings (after deduction of cc vouchers) - this will only actually affect my 6 weeks ats 90% though.

then, company have to continue to pay for CC vouchers whilst I'm on mat leave in addition to stat mat pay.
the childcare vouchers I recieve on mat leave can be saved up (for when I do go back to work) or used whilst I'm on mat leave for baby & me days & for DD1 to continue with her childminder.

if this is all correct I am one very happy mumma! however, now I have the dilemma of whether to save up cc vouchers or use them for mat leave. lovely dilemma!!!!grin

is that all correct??

shentok Sat 04-Jan-14 18:54:38

evening, thanks for this thread, it's a very tricky subject! I raised this with my employer and they said that they would pay them but when I return to work I'll have to pay it all back. Does that sound right?

poopooheadwillyfatface Sat 04-Jan-14 19:02:08

no, shentok.
They have to swallow the cost

shentok Sat 04-Jan-14 19:05:26

that's so cheeky of them! do you have any tips on what I can say to raise this again? I've seen wording which agrees with them paying it but nothing that says I should not have to pay it back. tia x

PenguinsDontEatKale Sat 04-Jan-14 19:06:28

Shentok - no, that is wrong.

MrsRV - you are right. The reasoning as to why they continue is linked to the salary sacrifice way they operate. It's not a question of 'buying' vouchers out of your salary normally. You agree to a reduced salary and, in return, you get a benefit (vouchers). Benefits - like company cars (if they can be used for personal as well as business travel), health insurance, life insurance, etc - have to continue during mat leave. So vouchers have to continue.

It is perfectly lawful to continue to deduct for vouchers from enhanced maternity pay. But you aren't allowed to deduct from SMP. So once you are on SMP they have to be given 'free'.

Shentok's employer is wrong because you can't retrospectively bill for benefits.

Have to say, not all employers allow you to do the 'have your cake and eat it' thing of opting in and out to ensure that your higher salary is used for SMP and you still get vouchers whilst off. As far as I know it is perfectly legal to say (as my employer did), that you can only change your voucher arrangement at two points in the calendar year (April and October). Plus you could opt out of them when you notified them of pregnancy, but couldn't then opt back in unless it happened to cover an April /October change date.

Eletheomel Sat 04-Jan-14 19:51:23

HMRC have guidance for employers regarding what to do with childcare vouchers when maternity leave is involved, you can view it at: www.hmrc.gov.uk/employers/sml-salary-sacrifice.pdf

Refer them to a copy and stand your ground. One of my old colleagues raised it with her organisation who queried it (this was only 3 years ago - so they should have known). In the end her firm got legal advice that confirmed what she'd been telling them anyway (that they have to pay for her vouchers during her ordinary and additional maternity leave - she only got the basic maternity pay (6 weeks at 90% then smp) so it made a huge difference to her finances and kept the routine/place for her older son.

mycatlikestwiglets Sat 04-Jan-14 20:12:26

This is interesting - I also work in a law firm and I'm sure I was told I will have to stop receiving childcare vouchers once I drop down to smp. I remember thinking it didn't seem right so will definitely look into it now.

theborrower Sat 04-Jan-14 22:18:36

Eletheomel thanks for the HMRC link, will read it later (23 pages!).

So, in summary, your employer should still give CC vouchers while you are on smp - like free money?? except its not because its your salary sacrifice benefit? Have I understood that right?

Sounds like I am best to stay in the scheme, is that right?

diddlediddledumpling Sun 05-Jan-14 08:40:39

mamapants that's what I was told by our finance manager who initially informed a colleague that she wasn't entitled to the vouchers while on mat leave. The colleague pushed on it and when finance manager looked into it, it was true (she told me). Not sure if it makes a difference that it's a school.
Certainly she was initially very reluctant to pay it, and I don't think she would have if it was costing the school money.

diddlediddledumpling Sun 05-Jan-14 08:43:24

mamapants that's what I was told by our finance manager who initially informed a colleague that she wasn't entitled to the vouchers while on mat leave. The colleague pushed on it and when finance manager looked into it, it was true (she told me). Not sure if it makes a difference that it's a school.
Certainly she was initially very reluctant to pay it, and I don't think she would have if it was costing the school money.

PenguinsDontEatKale Sun 05-Jan-14 08:59:22

It may be that there is government funding for schools to cover vouchers, but fundamentally employers do pay for them. smile

PenguinsDontEatKale Sun 05-Jan-14 09:00:53

It doesn't cost normally be because of the salary sacrifice, but during SMP it does.

mamapants Sun 05-Jan-14 09:38:26

F

mamapants Sun 05-Jan-14 09:44:38

Oops
Hi diddle the finance manager must be confused.
In general providing childcare vouchers doesn't cost a company any money as the cost is covered by the persons wage and tax that would otherwise be paid- so in effect the governments contribution. And this actually can save the company money as they are not payoing NI on the amount sacrificed.
During SMP there is no salary to deduct and no tax to be saved so the company has to fund it. In my work local government we fund it out of the savings made. There is no additional funding for school staff.

mamapants Sun 05-Jan-14 09:48:30

I would also add that in my work we don't advertise the fact as if everyone did it it would cost us money and then my work would probably scrap it as we have zero budget. But am shocked at the employers lying about it and those trying to claim the money back off people!

diddlediddledumpling Sun 05-Jan-14 11:42:49

Pages 8-9 of this seems to say different, as of 2008. By the way, I'm talking about AML, when I still received the childcare vouchers. Honestly, I'd be very surprised if the finance manager was confused. She's absolutely meticulous and often a pain in the bum

diddlediddledumpling Sun 05-Jan-14 11:43:55

Sorry, I'm reading your post again mama and I realise that doc doesn't contradict what you're saying. Apologies.

chocolatesolveseverything Sun 05-Jan-14 17:36:47

Yes, your employer has to fund the vouchers during your maternity leave. This is a real shame imo, as it has meant when staff at the charity I work for (as HR Manager) asked about us starting the scheme, we had to say no as we can't afford the financial risk :-(

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