HR question re Mat leave and Holiday pay

[PugPupsMum]

Posted this under Pregnancy but posting here for traffic as well, as lots of HR whizzes might be here rather than over in that thread...

In a recent meeting with my boss, I said that I wished to save my maternity leave for when baby was here, but might use my remaining annual leave to go a bit early (if I am struggling with work/fancy finishing up a few weeks before due date)

She said I was perfectly within my right to do so, but, as I am currently training up my maternity cover hire, if I was willing, she'd rather me work and be paid for my untaken holiday.

I provisionally agreed to this (as I would prefer the money, and my job is a desk role and not strenuous). I then recieved an email from HR telling me I would be paid for the holiday I have accrued to date.

During the conversion with my manager, I was under the impression I would be paid for my remaining annual leave for the whole year (1st Jan - 31st Dec 2019).

I fed this back to HR who said no, I would be paid for the untaken holiday accrued so far this year, and the remaining holiday accrued during my maternity leave would be rolled over to next year + bank holidays (Bonus, didnt think I would be getting them on top).

But now I am not as comfortable with this. It doesnt seem right. I wont be able to take any annual leave while I am on mat leave, as obviously I wont be at my place of work, so that remaining holiday to accrue should already be mine - as I am still employed and entitled to it despite being off work.

Not only that, but by their method, I would be returning to work towards the end of 2020 with 28 days holiday + 2019 holiday accrued during my mat leave + 8 bank holidays, meaning I would have to take loads of time off before the end of the year when it was renewed.

Any advice please would help a lot.

Also, to make matters even more complicated, my DH has suggested I request my holiday lump sum is paid to me when I am receiving stat mat pay, not before, as the lump sum + my usual salary payment will incur a higher rate of tax and student loan payment. Is this correct, and if so is it reasonable/likely to be honoured if I ask for a delayed payment (after the 6 weeks of 90% earnings period)?

Thanks HR/mat leave experts

I’m unsure of the legalities if paying you for the exustingvhokiday entitlement rather than you taking it but it’s stabdard to accrue annual leave while on mat leave and add it to your next years entitlement if it’s over two years.

They won't pay you until you've accrued the leave, just like anyone else who was still employed, it's not already yours! What a lot do in this situation is 'return' from mat leave earlier, but use annual leave so you're back on full pay whilst still actually at home with baby. You'll just get your money at the end rather than the start.

I understand that the annual leave does roll over but you can then choose to be paid for it at the end of your Mat leave instead of the additional holiday.

I finished work at 38 weeks and DD was then 10 days late so I was allowed to take 17 days (it was over Easter so bank holidays were counted separately) A/L as they allowed me to officially start my Mat leave in the day DD was born, rather than my due date, so will then have 8 plays plus any remaining bank holiday days available to use next year.

I took the AL I accrued whilst on Mat leave at the end of my Mat leave so it extended my time off - 9 months may leave then 1 month AL (and a full month pay packet) before returning. The full pay before returning helped pay nursery bill and buy some new work clothes etc

I wasn't allowed to take AL I hadn't accrued at the beginning of my Mat leave

I think most people use the accrued annual leave at the end of their mat leave so that you start being paid before you go back. I did this with both of my mat leave's. So I had 13 months off. The last month of which was actually annual leave.

I'm not a HR bod, but can tell you my experience (NHS) dates are approximate as it was a good few years ago! My AL runs April-March.

I went on mat leave in September, baby was due end of October. I chose to start mat leave at, say, 36 weeks. So they worked out how much leave I had left pro rata until the day my mat leave officially started, and I took that before. So I finished at around 33 weeks (personal choice).

I had the full year of mat leave that I was entitled to. Over that year, I accrued a full years annual leave. I then chose to use that all at the end, so I started to get paid 6 weeks before I returned to work, as I get 6 weeks leave. When I returned, in November, my leave was worked out pro rata from the until the end of March, which I then used as I normally would. I think I could have returned earlier and got paid for both the leave and the working. I don't think I could have added the whole 6 weeks to my leave for the rest of the year, though I could be mistaken, I was always going to take it at the end.

I think what your HR dept is saying is correct. You can only use the leave you've accrued up until your mat leave starts. After that, the clock is reset, and you accrue leave whilst you are off to be used at a later date.

No company is going to pay you for annual leave you haven’t yet accrued! That would be insane. What you’ve been told is absolutely standard, correct practice. You accrue leave during mat leave and then either take it at the end (in my case I used it when I went back to shorten my first few working weeks and ease me in) or some orgs will let you take it as pay.

Individual companies can take a different approach but it's normal to only receive holidays for the part of the year you have accrued them - usually the days from this year are added to the end of maternity leave on full pay of course.

They're not going to pay you for leave you haven't accrued. Completely normal.

You can't be paid for holidays accrued on mat leave. This is called 'buying out' and it isn't permitted.

My work wanted to pay me for the holidays and get me back to work, I wanted to take my holidays (wasnt bothered about the cash). I took legal advice and they were not permitted to pay me for holidays and had to allow me to take them. It does mean you end up with a lot of leave when you return to work!

Some useful info here
www.markmasonlaw.co.uk/blog/?p=171

I used to work in HR and agree with Mamaslave, most people add it on to the start and end of their maternity leave.

What your company have said is normal IME.

Completely normal. I can't see why you think you can take holiday you haven't yet "earned".

The key word here is 'accrued'. You can't be given annual leave that you haven't yet accrued.

I get 25 days holiday a year, Jan-Dec. I’m due baby in September, but am using up all of my 2019 holiday entitlement before hand so I can go on leave from August, but using annual leave for the first 3 weeks and starting actual mat leave from my due date, unless baby is early! So I find it odd people saying that you can only use holiday you have already accrued - we have an entitlement for the year, and can choose when within the year to take it; if it’s all used up by the summer then you just can’t take any more holiday until the following year! Is that not normal? Maybe it’s because they are going to pay it rather than let you take it

I'd just use the annual leave to either extend beyond the 12 months you're entitled to, or to extend 9 months paid to 10/11. that's equivalent to a lump sum in effect if you were planning on taking the year

Tax wise, the tax year runs April to March so it makes no difference when you get the holiday pay within the year as the total tax paid will be the same. It sounds as though you are going off fairly soon and will only get smp after the first 6 weeks. So most of your year of mat leave (= lower earnings) will fall within the 2019-2020 tax year. So there's no point in delaying the pay from say now until December, as it's all within the same tax year. If you get an extra lump sum you will pay extra tax at the time but you will get this back (may have to claim but that is easy).
If someone was finishing work on say 5th Feb, it would be worth them delaying receiving the holiday pay to the next tax year but it depends how it falls.
To be honest I doubt they would be willing to delay the pay until the next tax year anyway as technically it's earned this year so probably isn't allowed.

I'm in HR and what you have been told is correct, you can only take holiday that you have accrued already. Your remaining holiday that you accrue on maternity leave will be rolled over and most do take it as a block at the end of maternity leave so for the last month or so that you are at home you are essentially back at work but on leave and being paid accordingly.

A PP mentioned about being able to book holiday whenever in the year that you like whether you've accrued it or not. That's absolutely fair and you could technically take all of your annual leave entitlement at the start of the year. However, if you were to leave then the amount of leave you'd accrued up until your leaving date would be calculated and if you'd taken more days than you had accrued your final pay would be reduced accordingly.

I'm not even sure that legally you are allowed to have the holiday paid in lieu of taking it as time off so I wouldn't rock the boat! From their point of view it makes sense to only pay you what you have accrued. If you decide to resign a few months into maternity or they make you redundant, you would have been paid for holiday you are not entitled to. Similarly if you care back earlier you would have no leave left to take as you would have been already paid.