right to contractual benefits in maternity leave, including workplace nursery

[hermionegrangerat34]

I'm currently ttc, and wondering about my maternity package as my benefits package is a bit more complex than usual. Mainly, in addition to my salary, I am paid a housing allowance of 5k a year (because the organisation should have provided me with a house in my particular job, which I know is unusual, but they didn't have a suitable one and I negotiated this instead). My reading of the law is that this should continue over and above my maternity pay - if it was a house it obviously would - but just wanted to check!
Also, I use the workplace nursery and pay the full amount by salary sacrifice. Is this a contractual benefit so I would continue to get the nursery fees paid, and then have my maternity pay calculated on the remaining salary; or would this count as salary? Or would I have to stop doing the salary sacrifice to get my salary higher for mat.pay calculations? Ideally I'd continue using the nursery during my maternity leave.
It would be great if anyone knows the answers to these questions!

hermione I am not going to pretend this is an easy one!

Housing allowance. Allowances are tricky and not clear as a matter of law as I understand it. Your argument would be obviously that this is a benefit which (in your particular circumstance) was given as an allowance through no choice of your own, it is separate from your salary and therefore should continue. It's by no means clear in law but in your case I think you've got a very good argument.

With the salary sacrifice I would expect there to be a provision for what happens during maternity leave in the terms and conditions of your salary sacrific agreement - is there nothing mentioned? In terms of how it may impact on your maternity pay, in your position (or indeed in the position of your HR department) I would be asking the payroll department for advice, as payroll stuff is not my area of expertise in the slightest.

Having done a google search, I found this guide to salary sacrifice from HMRC, which seems fairly comprehensive but I am going to be honest and say I would be ringing payroll and going 'waaaaaaah' at them....

I think when it comes to your housing allowance you have an excellent argument to retain it, and hopefully should have no problem there. Might be best just to carry on as if you will still be getting it iyswim, so if they want to try and take it away the ball's in their court, but I would think there will be no problem. With the salary sacrifice check the t&cs of the scheme you have first I'd say.

I hope that's a bit helpful, it's a tricky one as I say, and I'm slightly out of my comfort zone!

HA should continue and would be included in the SMP calculation (as it is based upon actual pay). Not sure about the nursery for the £ but you'd need to change by the weeks upon which the SMP calculation is based to benefit which may not be practical as presumably you'd need to continue to use it until you go on ML.

Have a look at the workingfamilies factsheet about rights during maternity leave - there's a section on car allowances which is interesting to you. You can see that when it comes to financial allowances it's not cut and dried and lots depends on how it is negotiated with your employer. As your housing allowance is definitely instead of a benefit that you should hvae had, I think you should be fine, I am assuming it's listed separately on your payslip as well, so it's clearly not part of your main salary.

Thanks! I'm rather reassured by fbb finding it complicated too - not just me being thick, then! The housing allowance is paid separately - I def want it to be continued rather than count as salary, as otherwise it will be halved when I go to half pay. I'll assume it will be OK!
Nursery - the website staff handbook just says let them know when your pg and they'll work out what's best done. so I guess I'll just do that. I just like knowing!!

regards salary sacrifice - you'll have to stop this in the period when your mat pay is being calculated, so that your average earnings can be as high as possible. I've had to stop mine for the mths of may and june and am due in oct. we won't be using the scheme when I go on mat leave so don't know what happens if you still need to use it then.

According to the link from the Inland revenue that flowery posted your employer does not need to continue paying your housing allowance as its a cash benefit, but they can choose to continue to pay it voluntarily. In your circumstances I know that my company would continue to pay the allowance - we have quite a few people who get an allowance in lieu of accomodation for one reason and another.

If you are in a salary sacrifice agreement you would definitely have to come out of it for SMP purposes though. If your company is claiming back the SMP element of any maternity pay it may be that they apply the same rules (unless they are particularly generous and pay the difference themselves!).

I had to opt out of my salary sacrifice scheme earlier this year, but I am able to stay in it while on maternity leave.

Good luck with your ttc - I'd speak to someone about salary sacrifice as early as you feel comfortable once pregnant so that it is sorted out in time for the 'qualifying period' used to calculate your maternity pay.

I don't think I'd be taking a HMRC factsheet as gospel on current employment law though, particularly where it's something like this which is being explored through case law rather than being clear cut in legislation.

I'd be advising hermione's employer to pay the allowance both as the morally right thing to do but also to be on the safe side legally, particularly as she was more than willing to take the usual non-cash benefit but they could not provide it.

Agree with bitofadramaqueen to have a chat with someone about the salary sacrifice earlier rather than later if you can.

Aarrrrrggghh, am previewing this message and DS is pulling down the top of my laptop trying to get my attention! Am bad mother.

I think you have to check with your employer about the salary sacrifice scheme. I was on one of these for our workplace nursery when on mat leave for dd3. And I asked them and they told me that it made financial sense to stay in the scheme during my mat leave.

I can't remember the exact details but it sounded convincing at the time.

however I was still using the nursery during my mat leave. And I didn't take any unpaid maternity leave, only the paid part. Those things probably make a difference.

Thanks so much everyone!
Yes, Fennel, I wonder if it is worth staying in if I'm still going to be using the nursery; from the various factsheets linked to, it seems the childcare vouchers are a benefit not pay, and so presumably you still get them if your SMP is calculated on what you are actually paid (ie, its possible that if I stay in the scheme then they still have to give me £500 worth of childcare each month on top of half pay, instead of half the total pay - so I'd be £250 a month better off?). I'll ask early, anyway!

I'd definitely check out the rules of your salary sacrifice scheme on that one hermione.

I deal a lot with salary sacrifice childcare vouchers in my organisation, and while our employees have the right to sacrifice £X amount of their salary which is then used to purchase childcare vouchers, they dont have any contractual right to the vouchers themselves. So no matter what their salary was, they would still have to sacrifice the same £X to get the same value in childcare vouchers.

Off the top of my head the maximum the inland revenue will allow to be salary sacrificed for NI purposes is in the region of £240 per month.

If you're sacrificing £500 per month it may be that your company is offering an enhanced scheme that they are subsidising though. I'm sure a kindly payroll person in your organisation would work out the best financial option for you when the time comes.

Hermionegranger, yes that's what happened with my mat leave pay, so I was better off staying in the scheme than leaving it for those months.

bitofadramaqueen - I think there is a difference between a workplace nursery (operating a salary sacrifice scheme) and the national childcare voucher salary sacrifice scheme. I've used both in different jobs. The latter is capped at about £240 a month, as you say. And is quite heavily regulated. But my old workplace nursery had no cap, you could pay the whole of your salary into your nursery fees (it used to feel as though I was doing just thatt when I had 2 under 3 in there and was working part time). It was quite a different system to the national childcare voucher salary sacrifice. A lot better.

Thanks Fennel, I did think Hermionegranger's workplace may be offering some kind of enhanced scheme. Ours is the normal inland revenue regulated salary sacrifice scheme sadly! Although I do get to salary sacrifice my pension contributions so its not all bad...

Hermione when the time comes I hope you win the argument that they should treat your housing allowance the same as a 'house' - it's definitely the moral thing for them to do in my humble opinion!

Thanks Fennel, that does sound hopeful! Yes, its a workplace nursery which makes a huge difference financially - and is by far the best nursery for miles around too, so I'm very lucky here.
I couldn't bear the thought of paying my whole salary to work - so we had a four year gap between dc1 and dc2, so one started at nursery as the other went to school. If we have another soonish, we'll be doing the same again. And it was FAB having dc1 in nursery while i was at home with dc2 on mat leave - avoided all that '2 under 2' stuff for most of the day! So would definitely do that again (and very lucky we can afford to, I know).

I meant '2 under 5' obviously...