Salary sacrifice and maternity leave

[Pipnik]

My son has a work subsidised nursery place that I pay for by salary sacrifice. I'm currently on maternity leave and have kept him in nursery.

From what I've read here www.hmrc.gov.uk/employers/sml-salary-sacrifice.pdf the salary sacrifice makes the nursery place a non cash benefit and should be provided by my employer throughout my maternity leave whether I am receiving payment or not.

However my employer has told me I will be removed from the salary sacrifice scheme towards the end of my maternity leave when when I am on just SMP or no pay and will have to pay the nursery fees myself then rejoin the salary sacrifice when I come back to work.

They say they've taken legal advice and refuse to budge, are they right? Has anyone else been in this position? I think they are wrong, what can I do now?

From personal experience, you can receive the salary sacrifice if you have sufficient salary or maternity pay to cover it as the salary sacrifice is a deduction from your salary.
So for instance if you are near the end of SMP and taking additional mat leave then you may not have sufficient funds in your salary to cover the salary sacrifice. In that case they cannot take the deduction and therefore you will not receive the funding/subsidized nursery place.
If you receive a car allowance this is payable throughout mat leave, regardless of Maternity Pay (Company or Statutory).
If there are any qualified people out there that can help, please correct me if I?m wrong, or chip in.

I think they are in the wrong. AFAIK, it used to be the case that employees were removed from ss scheme upon commencing maternity leave, but this was changed sometime after 2006 and now the company should continue to cover the cost of this whilst you are on maternity leave.

I was removed from my employer's scheme in 2005 and 2006 when I was on ML with dd1 and dd2. I am now on ML with dd3, born last month, and my employers have confirmed that they will be covering my childcare voucher costs, in line with the amount I was paying prior to going on ML.

Given that my employers definitely would not pay for something if they didn't have to, I am assuming that some new legilslation is forcing them too!

HTH

AFAIK, employers are now obliged to pay childcare vouchers (eg the tax-free £243 p.m) on top of any SMP.

This is relatively new and, I assume that this is the 2008 amendment referred to in your link above.

Is this what you mean by work-subsidised or is it actually a company nursery/creche?

My employer (NHS) is going to continue my childcare vouchers (from salary sacrifice) throughout all my maternity leave - even when my salary (that which is on top of statutory maternity pay) doesn't cover it. My understanding is that the benefit (subsidised nursery place or childcare vouchers etc) has to continue - by law. I think they are wrong too. The document you linked explains it quite clearly.

If they take you off the salary sacrifice scheme then they are forcibly changing your contract of employment and the only reason they are doing that is because you are a woman and on maternity leave - it's sex discrimination.

An employer is not allowed to make salary sacrifice deductions from SMP, however must continue to provide non-cash benefits throughout maternity leave. (So loobeedoo if your employer removed benefits from you when they were no longer able to deduct money to cover them that was illegal.)

Pipnik your employer is not proposing to try to make deductions from your SMP, but is instead trying to forcibly remove you from the scheme during your maternity leave in an attempt to avoid providing your contractual benefits.

That would be discriminatory in my view, but also, if you check the rules of your particular salary sacrifice scheme do they actually have the right to chuck you out of the scheme at will?

It's essentially a company nursery, the company "owns" several places at a local nursery which work out cheaper than going directly to the nursery.

Can you forward them the documentation and point out the law has changed?My salary sacrifice afaik continues throughout my mat leave even we on just SMP.

Are you in a union?

No, not in union and have already sent them links to the documentation.

What do the rules of the scheme say about removal Pipnik? As I say I am confident it would be discriminatory to forcibly remove a woman on maternity leave from a salary sacrifice scheme against her will, but it may be easier to convince them if they would be breaking the rules of their own scheme by chucking you out.

The literature on the scheme is a little confusing.

The form I actually signed says I can only leave the scheme if my child leaves the nursery.

Other paperwork about the scheme says I may choose to either withdraw from the scheme or make changes to the salary sacrifice if I undergo a life changing event. (I read this as I don't have to if I don't want to)

Elsewhere it says I will have to stop being part of the scheme if I am on the unpaid part of maternity leave, which is what they are quoting to me at the moment.

I can find nothing else about removal from the scheme.

So essentially, Pipnik, they are saying that the specific terms of your contract (I will have to stop being part of the scheme if I am on the unpaid part of maternity leave) override any statutory rights that you have?

I suspect that you may have to take some specific legal advice as to whether the contract is in itself discriminatory but will leave the final input to Flowery who is much more qualified than I to advise on such things.

Good luck

Thanks Anton, I think you;ve picked out the point I need clarifying there.