Maternity pay as lump sum (redundancy)

[bluebury]

Wasn't sure whether to put this in pregnancy or work, so hoping this is the right place. Hoping something can help or has experience of this. Sorry in advance for the essay.

I'm due to go on maternity at the end of October. I have past the '15 weeks before due date' marker and been a the company for other 2 years. I am only entitled to SMP if 90% for 6 weeks then £148 for 33 weeks.

The small company I work for is going through a lot of changes. I have a strong inkling they are going to wrap up the company and move some/all of the staff over to a newly registered company they created last month. I like the company I work for, they are going through a tough patch and I'm conscience of how my maternity pay could impact them wanting to make changes like this.

From my online reading my understanding is the company I'm currently employed by are now obliged to pay me my maternity pay. Even if they move everyone else over to the new company the 'old' company would have to remain open in order to continue paying me maternity.

Their other option seems to be to pay me maternity as a lump sum (I think I'd have to agree to this). They could then make me redundant and do whatever they wanted with the old company without the technicalities of having to pay my maternity every month for the 9 months. Then if they wanted to re-employ me under the new company after maternity they could.

If I was to be made redundant and accept my maternity as a lump sum, I'd:

1. End up paying more student finance on it, which is 9% and can't be claimed back.
2. Pay more NI on it, around 2% which again I can't claim back.
3. Pay more tax on it, but I could claim this back at the end of the financial year.
4. Get a statutory redundancy payment which from my working out would offset the money lost to student finance and NI but not leave much spare (under £100)
5. Loose the 20 days holiday pay that I would have earned over the 9months if they'd kept me employed.

I want to do what is best by the company without screwing myself over, so I'm only looking to break even over the 9months. So if the redundancy conversation came up would ask for the lump sum maternity, statutory redundancy and then pay for 20days holiday I would have earned. I know there is no guarantee that they'd employ me under the new company after my maternity leave but I'm ok with that.

Does anyone have experience of this?
Does this sound about right? Is there anything I'm missing?

Yes you're missing plenty.

If the function the staff are currently performing is transferred to another company, that would usually be a TUPE situation (Transfer of Undertakings (Protection of Employment). This means terms and conditions are protected as well as length of service, and any liabilities/obligations (such as SMP) go across as well. An exception applies if the old company is terminally insolvent and is under an insolvency practitioner, or is bankrupt.

If it's a TUPE, you could only be made redundant if your position is genuinely redundant, and this can't be because of the transfer, that would be unlawful, or because of your pregnancy, that would also be unlawful. They don't get to pick and choose who they take across, it doesn't work like that.

If TUPE doesn't apply because of insolvency, then everyone would be redundant.

If your position is genuinely redundant (and they go through a fair process and don't single you out because of pregnancy or anything like that, then they could pay you your redundancy pay as a lump, yes.

"I want to do what is best by the company without screwing myself over"

You don't "do" anything, because none of the above is something you get to choose. You ensure that whichever company is employing you treats you right and within the law, without discriminating against you in any way. You don't owe the company anything, and you certainly owe it to yourself and your child to ensure you get whatever you are entitled to.

I think if not TUPE and you are made redundant, then they will pay you redundancy pay and you’d qualify for MA instead of SMP if I’m understanding your problem correctly.

@flowery Thank you so much. It's so confusing and a small company without HR so I don't think they even know what is and isn't ok. Having spoken to a friend in business they seem to think its possible they'll make the current company insolvent then buy it out of administration with the new company that has a different director.

I haven't spoken to the director about it yet. He's been honest to me that they aren't in a great situation and are doing everything possible to protect my maternity. Then I accidentally discovered the new company this morning (director sent me an email from the new company email address so I googled it), which has got me slightly worried. I just want to make sure I understand what my rights are as much as possible before I talk to them or they pull me into a room to break any back news to me.

This company is like family to me and I know they don't want to screw me over. But at the end of the day they have to do what they have to do to keep the company afloat.

@00Sassy Because I'm past the 15 weeks before due date I think it has to be SMP rather than MA. But if they were to make the company insolvent than I can claim put in a claim for SMP through the government. I'd just rather not have the hassle.