Reducing childcare vouchers for qualifying weeks, then put them back up?(28 Posts)
Hope this is the right place to ask this! Not sure I've got this right in my head.
I claim the full £243 for my daughter. I'm due in January with number 2 (so currently 14 weeks).
If I reduce my voucher amount to a nominal £1 (so don't cancel the scheme altogether) from now until 25 weeks, and then return it back to the full £243, will this have the effect I'm aiming for - ie. maximise mat pay but then still be paid the £243 once I go down to SMP?
I suspect my July pay will be taken into account when calculating maternity pay, and I've missed the cut off to reduce vouchers for this month, but was planning to do it for August and September, and then put it back up in October.
I was just about to do it, but then it occurred to me that my employer might only pay the voucher amount that I'd been paying during my qualifying weeks?! This is hurting my head...
We're only allowed to make changes once a year
My employer does allow me to make changes monthly, in case that's relevant!
I'm sure it will depend on the childcare voucher scheme. The company my work use will not allow us to just change the amount we wish to contribute. We need to have a lifestyle reason, so going on mat leave would count but not sure if they would count it twice in a short period of time iykwim?
I'm going back on mat leave for the 2nd time in 2 years so it's going to massively affect my mat pay but figured its better to pay the max amount pre tax as we need the childcare at the moment. My colleague said that our employer can't take childcare vouchers out of statutory mat pay so when I go onto that they have to pay my childcare vouchers for me as they can't just stop me being in the scheme. Not sure if your work is the same?
No you will get Â£1 as that is what you were getting in the qualifying weeks.
Whether it is worth staying in depends on how long you are taking off work.
I was told it is only worth staying in the voucher scheme during the qualifying weeks if you are taking more than 6 months off as your employer is obliged to continue the payments for you when you are on SMP only.
If you tell your Payroll dept your due date, they will be able to tell you which months they will be using to calc your mat pay.
The other posters are right in that an employer shouldn't allow you to chop and change without a lifestyle reason. However the op is probably correct in her employer does allow changes. I work in Payroll and despitey warnings we allow changes whenever staff want them, providing it's within the cut off.
Yes, that's the case everywhere as far as I know.
My work use Kiddivouchers which doesn't seem to require a reason to reduce the amount (it does if you try to cancel).
I suppose my question boils down to: is the amount of vouchers paid by the employer when going down to SMP based on the amount claimed at the start of maternity leave, or the amount claimed during the qualifying weeks? My gut says the latter, but want to be sure (for the reasons you state SweetPeaPods!)
Ah, I think Percephone has answered my question!
Sweetpea all employers should continue ccv's during mat pay without deductions. Because what should happen is the ccv invoice should be made automatically, and your wages reduced accordingly. Not a deduction on your payslip IYSWIM. It should be reflected in your contract, but that's work for HR depts, so most will opt for the easier option
I'm no expert on the subject but have some knowledge
Are you looking to maximise based on your company's mat pay scheme? I ask as entitlement to smp is calculated based on gross pay, therefore will be calculated on the amount paid before deductions, including (I would assume) the amount paid for child care vouchers.
I would think that any additional mat pay scheme would do the sane but worth checking with your company.
This link could help and also bases entitlement in gross pay
Vouchers come out before Tax and NI, therefore are considered pre-deduction, based on what I've read this morning. I work for a local authority, so guessing schemes are pretty similar across the country (6 weeks at 90%, 12 weeks at 50% then SMP)
Bit more scooting around seems to confirm Percephone's point about vouchers being paid at the rate claimed during qualifying weeks. Given I'm hoping to take a full year, I think the benefit of continuing to claim to £243 (and therefore getting this paid by employer from week 18 of mat leave onwards) will outweigh any benefit of opting out. I hope!
The qualifying period is for SMP only, not for contractual benefits. What have you found saying that employees get the contractual benefits they were receiving during the qualifying weeks OP? Because whatever it is is incorrect.
Employers have to provide whatever contractual benefits the employee would have received had she been at work rather than on maternity leave. So if your scheme allows you to increase your vouchers before going on maternity leave, that will be the amount you will continue to receive during maternity leave.
Was a post on MSE!
SO...I could reduce vouchers to a nominal amount for the next two months to cover my qualifying period, and then bump them back up, and employer would need to pay whatever amount I claim (presumably I could change this during mat leave by the sounds of what you're saying?).
Is it worth me checking with payroll? I'm never very confident that they actually know the answer to these things...
You helped me a lot a few years ago flowery when I was put at risk just before going on maternity leave, so I am very happy to defer to your wisdom!
The scheme definitely allows me to adjust my voucher amount monthly, and there doesn't seem to be any restrictions within the terms and conditions on moving the amount again the following month or two.
Well I'd be cautious about MSE for employment law advice, but to be fair there is a disclaimer on this topic which you should also take into account- I might not know what I'm talking about either....!
Any reputable official source, like gov.uk or ACAS will be able to confirm that your terms and conditions are protected during maternity leave, and contractual benefits you are receiving, including childcare vouchers, form part of your terms and conditions.
There is no requirement to only apply terms and conditions that are in place during the qualifying week, and ignore changes made subsequently, the requirement is to maintain terms and conditions as if the employee were at work.
Oh, and don't rely on payroll for accurate employment law advice either, that's not their field at all.
Agree with flowery! Qualifying week is nothing to do with benefits.
Someone upthread asked about occupational maternity pay. This can be calculated on the reduced salary as it's not necessarily calculated during qualifying weeks but bear in mind it's not the case that they can just 'deduct' from it but that it should be calculated using reduced salary. So if you get 50% for example it would be 50% of the reduced pay. Not 50% of your original pay with the CCV value knocked off
Also it's not down to the childcare voucher provider whether you can change each month or just once unless of lifestyle changes etc it's down to the employer. So you could have two employers using the same provider but have different rules.
Just spoke to payroll who said I can adjust the vouchers monthly no problem, but that "vouchers will only be available whilst receiving occupational maternity pay, and won't be provided once it goes to SMP" - they're wrong aren't they?! Is this something I should clarify before mat leave (wary of putting pressure on and them withdrawing the scheme as I've heard that happening elsewhere) or fight that fight when it comes to it? Ugh.
Policy says "Childcare vouchers cannot be deducted when in receipt of SMP alone" which is not the same as saying they won't be available!
This is the guidance issued by my provider which suggests the employee can operate an over ride and don't need to pay them - www.kiddivouchers.com/pdfs/Childcare%20vouchers%20during%20maternity%20leave.pdf - but there is no mention of an override in the agreement or terms and conditions on the website.
Yes they are wrong.
This official HMRC guidance makes very clear that deductions cannot be made from SMP but that all contractual benefits including childcare vouchers must continue to be provided during maternity leave.
I would suggest you raise your concerns rather than wait for a fight as they seem to be announcing their intention to discriminate by unlawfully withholding contractual benefits during maternity leave.
I would suggest a letter to HR saying that you are concerned to note that x in payroll is suggesting the company intends to withhold contractual benefits during maternity leave. As you are sure they are aware, employers are obliged under equality legislation to provide contractual benefits during maternity exactly as if the employee was at work, and withholding benefits would be unlawful discrimination. You would therefore be most grateful if they could ensure the payroll team are fully briefed about the requirement to continue to provide benefits in order to avoid a discrimination issue.
Just to check one thing. I queried with the voucher provider whether there was any such "override" in the salary sacrifice agreement and they highlighted the following:
"I agree that my monthtly gross pay will be reduced by amount (the "Salary Sacrifice") equal to whichever is the lowest of:
B) the maximum amount that my pay may be reduced whilst I still receive the Narional Minimum Wage and/or any statutory sick pay, maternity pay, adoption pay or other payments that my employer is obliged by law to pay me"
From what I understand, as it's a benefit of employment, the "maximum amount" should be whatever value of vouchers I claim, but they seem to be suggesting this means they don't have to pay the vouchers once I go down to SMP?
Just getting ducks in order for whatever they throw back at me. And quickly joining the union!
There are basically two completely separate bits of law. The first bit is HMRC regulations about SMP and other statutory payments, and says that salary sacrifice deductions can't be made from statutory payments. So if you are receiving, say, SMP plus occupational maternity pay, or pay for a keeping in touch day or something, any salary sacrifice applied can't take your pay below what the SMP element is.
That bit of law is what that thing they highlighted to you deals with.
Completely separately, (and not dealt with by that sentence from the voucher provider), there is an employment law requirement for an employer to continue to provide any and all contractual benefits during maternity leave. There is no exception made to that for benefits which are ordinarily provided under a salary sacrifice arrangement. Once you have sacrified x amount of salary in exchange for x amount of vouchers, your terms and conditions then become a salary of x plus benefits of x. Salary stops during maternity leave, but benefits don't.
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