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Original poster

Childcare Vouchers and Maternity Leave

80 replies

speedbird17 · 12/01/2015 14:30

Just trying to establish what I am entitled to as there is lots of advice contrary to what my employer is saying out there!

I am entitled to SMP only, so employer has stated I will be forced to suspend my vouchers until I am earning a salary again. It was flagged up to me by an acquaintance that their employer goes by HMRC rules that if maternity pay does not cover non-cash benefits such as childcare vouchers, a car etc that the company must carry on paying the amount on your behalf.

My employer has answered my query by stating that the class the voucher as a remuneration and as such will not class it as a non-cash benefit and will force me to suspend my participation in the scheme.

Can they do this? Is the information I have read on HMRC and other childcare trust sites etc correct? I am not wanting something for nothing, but if I am entitled to the payment it would greatly help to have it IYSWIM...

Any advice and info appreciated! Thanks in advance!

OP posts:
nannynome · 12/01/2015 21:36

Thank you so much for this, I wasn't aware of this, you have made me very cheerful!

Pinotgrigioplease · 12/01/2015 21:45

But you would be better off overall surely gallic to sacrifice the salary and get the vouchers for the whole of your maternity leave?

I also get OMP but will not be changing my voucher amount.

flowery · 12/01/2015 21:53

OP you need to stop communicating with the payroll department. You need to raise a grievance for maternity discrimination and involve HR not payroll.

Say that under the Equality Act they are obliged to continue to provide all contractual benefits throughout maternity leave however the payroll department have indicated that the company has no intention of meeting its obligations in this regard. Failure to provide any of your contractual benefits including childcare vouchers during maternity leave is unlawful discrimination under the Equality Act and you would like to seek assurances that the payroll department have misrepresented the company's position, and that you will be provided with all your contractual benefits, otherwise you will have no option but to take further action.

Original poster
speedbird17 · 12/01/2015 21:57

Thank you Flowery, that communication was all from earlier today. I shall try and find out how to contact HR (incredibly difficult in such a large company with my posting being remote) and I will e-mail them along the lines of what you have said. I really do appreciate your guidance and help, so thank you very much.

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munchkinmaster · 12/01/2015 22:06

Interesting, i opted to get my mat pay evenly over 12 months as I thought this would help me max the tax breaks associated with the vouchers - but as occupational runs out at 6 months I'd be much better going on to smp then? I'm 4 months in. Might ask to change.

If I go onto smp for 3 months then nothing for 3 months will they really still give me a voucher (nhs).

PinkOboe · 12/01/2015 22:11

Speedbird your company's responses sound very similar to those I received from mine

I refused to opt out of the scheme. They maintained they'd seek to recover what i'd claimed once I returned to work. They never did, this was 2 years ago. They've since changed provider and the wording in the hr manual and the application form now includes a teeny tiny disclaimer that you'll agree to either stop your claim whilst on smp or agree to repay. Bastards. After everything we do for them Angry

PinkOboe · 12/01/2015 22:13

And my memory here is hazy but I seem to recall that if they're claiming its not a non-cash benefit then they should've been paying national insurance for that part, which as it is a non-cash benefit they hadn't been. Or somesuch.

unclerory · 12/01/2015 22:23

They are wrong and just want to save themselves some money. Which is fucking cheeky because they save money every month because they don't pay NIC on the money you receive as childcare vouchers so save £401 per year thanks to you taking childcare vouchers.

Speak to HR.

Original poster
speedbird17 · 12/01/2015 22:34

It just makes me so angry and as my job was created to save the company money in the first place I find it so aggravating when they are so cheap about things like this too! I'm already only being paid half what someone else doing the exact same job but employed 7/8 years before me is earning!

It just is such a big thing and I love my job and don't want to lose it!

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AgentProvocateur · 12/01/2015 22:40

I posted about this same thing a few years back, asking the question from an employer's POV (not HR trained, but ended up doing it for a while). As part of our professional indemnity insurance we had access to legal and HR helpline, and their advice was - and I'm paraphrasing - that it was a bit of a grey area. That it could be seen as unlawful discrimination to stop them, but that there had never been a legal challenge. We (the company I was with at the time) did stop them when people went on mat leave. The directors said it was either that or stop the scheme altogether, so there was unspoken peer pressure to give them up on mat leave.

Huge disclaimer - this was years ago, and things might have changed since then. And I'm no longer at the same company so I don't know what they do now.

Original poster
speedbird17 · 12/01/2015 22:42

I've read that it is still a grey area and is not unlawful as such which is what worries me...

OP posts:
flowery · 12/01/2015 22:48

Where have you read that it's a grey area speedbird? Do HMRC and the official gov.uk website plus all those other organisations not convince you?

Your employer will have a formal grievance procedure so make sure you follow it.

Original poster
speedbird17 · 12/01/2015 22:55

One voucher provider website states it is a grey area and that they will support an employer in event of a tribunal, think it was kiddi vouchers.

So do I go through the union or do I go straight to HR, fortunately I've never had to get involved in raising a grievance so am horrible uninformed...

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Elmersnewfriend · 12/01/2015 22:57

Your employer is putting their whole salary sacrifice scheme at risk by doing this. You have agreed to give up part of your salary and to receive a benefit instead. The fact you are no longer receiving enough salary to make it worth your employer's while is not relevant (or not to hmrc, anyway).

When you say large company - how large? Are they well known? As other people have said - this is illegal.

AgentProvocateur · 12/01/2015 23:03

www.kiddivouchers.com/pdfs/Childcare%20vouchers%20during%20maternity%20leave.pdf/ yes, kiddievouchers do say it's a grey area.

Original poster
speedbird17 · 12/01/2015 23:31

Yes, very big well known company. DH has said go for it as they will not want their name/rep tarnished by this, but it makes me so nervous. I just know how much it would help our family financially.

OP posts:
Original poster
speedbird17 · 12/01/2015 23:33

Nearly 60,000 employees and I imagine 99% of the population will have heard of them...

OP posts:
flowery · 12/01/2015 23:35

Yes a voucher provider would say that because they don't want employers put off offering vouchers. They are not experts and you would be better to rely on official government sources or other legal advisory services with expertise in this area but who aren't trying to sell something.

Check your grievance procedure and contact your Union saying you are planning to raise a grievance. They will help you do do and accompany you to the meeting as well.

What are you nervous of? What do you think might happen?

Original poster
speedbird17 · 12/01/2015 23:38

I love my job dearly and am terrified at the prospect of getting into trouble or disciplined for attempting to receive these vouchers. I have never raised a grievance so the whole process is unfamiliar and a bit daunting in all honesty.

OP posts:
flowery · 13/01/2015 09:07

You can't be disciplined for raising a grievance, and you won't be. They are trying to diddle you out of thousands of pounds, which as you are going to be on maternity leave and therefore not earning, would presumably be very useful.

The conversation at your work when this policy was set would have been something like this:

HR Director: We've worked out how much it would cost the company to pay childcare vouchers free for 12 months to employees going on maternity leave and it would be a lot. Is there any way we can get away with not doing so?

Legal Department: Well, current advice from the government and the various bodies offering guidance in this area is that these are a non-cash benefit so they should be paid, however having said that the chances of an employee knowing this or feeling confident enough to challenge it are fairly slim, so although it's risky, you could not pay them and see whether there are any challenges.

HR Director: What if someone does challenge it? There's a lot of guidance out there saying they'd be within their rights to do so.

Legal Department: Well, they might, but we'll draft you something legal-sounding and formal to quote back at them from us, saying our position is they are not a non-cash benefit and the chances are they'll probably back off. Even if someone isn't sufficiently intimidated and does take it further, you'll already have saved thousands by not paying the vouchers to previous employees anyway so it's probably worth it from a financial point of view even if you end up having to pay them in future.

flowery · 13/01/2015 09:15

I have access to various HR sites giving legal advice to HR professionals, and not one of them says childcare vouchers are a cash benefit. They all specifically say they are a non cash benefit and must be provided. None of them even say it's a grey area.

Your HR department will have access to this sort of advice as well so there is no way they genuinely believe they are solidly in the right legally. This is a strategy to avoid paying, not a genuine belief that employees aren't entitled to them.

YonicSleighdriver · 13/01/2015 09:18

at that convo, which sounds very likely!

SlinkyB · 13/01/2015 09:33

Flowery talks a lot of sense.

munchkin I had OMP/SMP/ 3 months unpaid mat leave (police) and was entitled to receive £243 in childcare vouchers every month, for the whole 12 months. I couldn't believe it either.

flowery · 13/01/2015 11:04

It will obviously depend on their workforce profile, but with 60,000 employees, there will be lots of staff going on maternity leave each year. If it's retail, for example, or another sector with a high proportion of female staff, the rates will be even higher. Complying with this requirement will costs them thousands and thousands of pounds annually, giving them a significant motivation for trying to avoid it.

Original poster
speedbird17 · 13/01/2015 11:13

Not retail, overall the company is quite balanced, but my job role is 75-80% female, so I can understand their wish to avoid paying it.

My union have now contacted me, so I am laying out the situation for them with the intention to raise a grievance. Thank you for all your information, support and help flowery.

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