Self Employed & Maternity Leave/Pay

[rainraingoaway86]

I have been self employed for about two years but only work for one employer, and work from home on my own equipment. My question is, and I'm pretty sure the answer is NO, do I have any rights to return to my job after maternity leave?
Secondly, I assume I am entitled to receive maternity allowance, can I return to work while still receiving these payments?

No, you can't work while receiving maternity allowance other than 10 keeping in touch days. And if you really are self-employed then you won't have any rights to the same job on return. However if you've only worked for one employer for two years then there might be some murky water about whether you're actually self-employed or de facto employed by them, known as disguised employment.

Btw it's highly likely that you aren't self employed if you only work for one employer.

I thought you had to be paid by numerous people to be self employed?

Whilst receiving statutory maternity pay you can still be self employed and earn .

But not just for 1 employer!

That's SMP, not maternity allowance. If you are employed and receive SMP then you can also do self-employed work and keep your maternity pay. If you receive maternity allowance you can't do any paid work other than 10 KIT days.

More info here, OP:
https://workingfamilies.org.uk/articles/what-work-can-you-do-during-maternity-adoption-parental-leave/#:~:text=The%20general%20rule%20is%20that,or%20Maternity%20Allowance%20(MA).

Ordinarily, you can work on a self-employed basis without it affecting your statutory pay. However, this doesn’t apply to those on Maternity Allowance (MA).
If you are on MA, you can only work up to 10 Keeping in Touch (KIT) days without it affecting your pay. Any work you do in addition to the 10 days, whether employed or self-employed, will lead to you being disqualified from claiming MA for at least the number of days you worked in excess of those 10 days.
Whilst you can’t work while you are receiving MA (apart from KIT days), you can still receive an income or wages, so if your business is generating an income for you while you are in receipt of MA, as long as you are not actually working, this should not disqualify you from receiving MA.

@Hugasauras @Oblomov23
Thanks for the replies.
I have read other posts about not being truly self employed if only working for one employer which is why i asked, I didn't realise it was an issue until then. Should I be doing something about this?

There's a test on the government website where you can check if you are really self-employed or not. Your employer should be cognisant of this too. If they are your only client and they have been using you for two years, then it's hard to form an argument as to why you should be self-employed and not an employee, other than them wanting to dodge their responsibilities. But there are a lot of facets to it - if you find the government test that might help work it out for you.

Thanks @Hugasauras.
I will have a look for the test.

Is the point that I should be asking my employer to make me an employee? I feel like I'm in a bit of a situation now that I'm pregnant (they don't know yet) and so they definitely won't want to do that at this stage.

@rainraingoaway86 https://www.gov.uk/guidance/check-employment-status-for-tax

@Tippingadvice thanks. I've done the test and apparently I'm Employed for tax purposes, however I'm still not sure where this leaves me.

If you're only working for one client and you have set hours/set responsibilities and a dedicated line manager/person to report into and you can't delegate tasks to anyone else, then you're employed not self employed.

Hi @thebellagio
Thanks for that.

Just to clarify:
I work for one employer
I work remotely and get allocated a set amount of work but I decide my own working days and hours
I use software provided by the employer on my own laptop

So are you saying I should be asking my employer to make me an employee? It's a very small business and I don't think they will consider doing this.
Thanks for your help.

You can be self employed with one client so I don’t know why people are saying you can’t be…..for example my friend is self employed home help for a elderly lady working 24hours a week.

She had no problems getting maternity allowance.

@rainraingoaway86 if you've done the website test and it's telling you that you should be employed, then that will tell you more than any one on here can tell you.

The only thing you can do is to clarify with your accountant what they think and have an open and honest discussion with your client. That's the only wya you can deal with it.

If you leave it and don't do anything, you could put yourself at risk of a huge fine from HMRC. And they are cracking down on people so the sooner you try and rectify it the better.

The burden now falls with the person/company receiving the service (or 'the employer'). It would be in your Client's interests to take this seriously.

The rules around this are quite complex; they are not clear-cut and often ultimately decided through an employment tribunal. If the CEST is coming back showing you as employed, then you should qualify for SMP. That is the approach you should take with your 'employer'/client.

@rainraingoaway86 the bottom line is your employer is acting unlawfully. However, being pregnant makes you extremely vulnerable.

The better option would have been for your employer to employ you via an Agency.

It is likely when you claim Maternity Allowance this will all come out.

To answer your original question, as you should be an employee you should have the right to return to your job.

You are going to have to talk to your employer about this but timing may be crucial.

A key date is 15 weeks before your due date. You must give your employer notice that you are pregnant (MatB1) and when you plan to take leave and SMP before this week.

I am going to suggest you talk to both ACAS https://www.acas.org.uk/checking-your-employment-rights/if-you-believe-your-employment-status-should-be-different and Pregnant then Screwed https://pregnantthenscrewed.com/advice-services/

Once you have done that make an appointment with your employer in the 16th week before your due date, do not let them defer this. Explain the situation and what they can do to rectify it (ACAS).

At the meeting give them a letter explaining you believe you are an employee and that you are pregnant and wish to take Mat leave from x to y dates including SMP. If they are not going to pay SMP please can they give you an SMP1. Make sure you keep a copy of the letter.

Point out that they can get 103% of SMP back from the gmt https://www.gov.uk/recover-statutory-payments it may help to ease the discussions.

Be prepared for them to not be happy as it will cost ££, also be prepared that they may terminate your contract with immediate effect. If they do try to get it in writing - don’t leave without it and go straight to the JobCentre to apply for Maternity Allowance and other benefits.

You also need to contact HMRC as your self employment is a fudge that needs resolving.

Hi @Sapphire387 thanks for your reply. Am I right in saying SMP is the same about as Maternity allowance ( which I assume I would be eligible for in any case?)

Smp allows for 6 weeks at 90% pay but otherwise MA is same rate

Not entirely. It depends who sets the hours, if same every week. how tax and ni is etc. Your status affects holiday pay, sick pay, notice period, redundancy rights etc.

Hi @Tippingadvice, wow thanks so much for taking the time to reply. Seems like very useful information.
Sorry for more questions, but are you saying I may get in trouble when I try to reply for maternity allowance? I don't think I have benefitted from working under my current status and would have been better off as an employee. I think this was always the original intention from both sides when I took on the role, but things just seemed to drift and ended up staying are they are.
I do plan to raise this with the employer (I'm only 12 week at the moment so I do have a bit of time) however I believe it's highly unlikely that I would be switched to employee status (it's a small company) so the best I could hope for would be to retain my usual income until I go on maternity leave.

@rainraingoaway86 what I am saying is when you apply for MA it may become apparent to HMRC that you have actually been an employee not self employed for the last 2 years.

Re being SE, the Uber case was massive in Employment law. There is a push to get SE reclassified as employees as they should be. It'll take time, but it's already started.

@Tippingadvice
Thanks.
But if they flagged it up, what would actually happen at that point?

It's unlikely your MA application will flag anything - they don't ask any questions about the nature of work from what I recall (I've done two applications for it in recent years), just for a declaration you are self-employed. If you've not paid enough national insurance through your self-assesment tax return (perhaps because you haven't earned enough) you'll be given the chance to pay it in a lump sump to access the higher rate of maternity allowance, otherwise you get a lower rate.

But if you have failed the government self-employment test then you need to talk to your 'employer' and see what the way forward is. It's unlikely to affect anything maternity-related as you are already pregnant, so even if they agreed to make you an employee from now on, it's most likely too late for this pregnancy (I started an employed job when I was 8 weeks or so pregnant after being SE, so wasn't eligible for SMP with the way the dates worked out).

If you do want to remain self-employed, then I'd recommend diversifying a bit - the trouble with only having one client, aside from any of the tricky stuff about employment rules, is that you are very vulnerable should you lose that client, which can happen very quickly if you are self-employed.