Financial Planning

Maternity & Paternity: Get The Best Deal For Your Family

Maternity & Paternity: Get The Best Deal For Your Family

Life is both tremendously exciting and stressful when you are about to have a baby. Feeling confused about maternity and paternity leave often adds to the latter.

In this article, we’re providing a simple, easy guide to parental leave to help you navigate this amazing, yet complicated time of your life.

We also will be including answers to common questions, such as “Am I Eligible”, and “What are the knock-on effects on pay?”

Let’s start with maternity leave:


Maternity Leave: An Overview

Women can take 1 year off work (52 weeks), following the birth of their child.

During that period, there are various rules affecting how you will continue to get paid.

Assuming you are eligible, your employer is required to at least pay you Statutory Maternity Pay for the first 39 weeks following your child’s birth.

To be eligible for SMP in 2018/2019, you must be earning an average weekly income of £113.

You must also have worked at least 6 months for your employer, by the time you are 15 weeks away from your due date.

If you do not meet these conditions, you might be able to claim Maternity Allowance from the government instead of SMP.

Assuming you are eligible, however, in 2018/2019 SMP entitles you to:

● First 6 weeks: 90% of your average, net weekly earnings
● Next 33 weeks: 90% of your average weekly earnings, or £145.18 per week (whichever is lower will be what you get).

After these 39 weeks are up, your employer is not obliged to pay you anything.

Some companies / organisations might offer more than this. So it’s important to check your contract and your employer’s policy.
Just make sure you inform your employer in advance of your desired maternity leave start date. At the latest, you must tell them 15 weeks prior to your due date.

By law, you have to take 2 weeks off work following the birth of your baby. However, you do not have to take off the full 52 weeks which you are entitled to.

The first 6 months of your maternity leave is called Ordinary Maternity Leave. You can continue to build up your holidays and claim employee benefits during this time.

Also, if you return to work during these 6 months, your employer must give you back the job you had prior to your maternity leave.

The next 6 months are called Additional Maternity Leave. If you return to work during this time, you can go back to your old job if it still exists.

If it does not, however, then you must be offered a similar job, with the same benefits and compensation.


Paternity Leave: An Overview

The situation is simpler for fathers, although it is also less favourable.

Statutory Paternity Leave gives you up to two weeks paid paternity leave, if you are an employee. If you are a contractor or agency worker, you probably won’t get this.

Statutory Paternity Pay in 2018/2019 gives you £145.18 per week, or 90% of your average weekly earnings (whichever is lower).

You must be the child’s biological father, adopter or intended parent. Or, you must be the partner or husband of the child’s mother.

You must have worked for your employer for at least 6 months, by the time you are 15 weeks away from the due date.


Shared Parental Leave

This is a fairly new system in the UK, which aims to give parents more freedom and choice when it comes to their parental leave.

The mother must still take two weeks off straight after the birth. Afterwards, up to 50 weeks of leave, and 37 weeks of Statutory Shared Parental Pay, can be split between the parents.

So, for instance, the mother could choose to take 10 weeks of maternity leave, and then end her maternity leave. From there, she and her partner could take Shared Parental Leave, and she could take, say, the next 20 weeks of leave. Her partner could then take the 20 weeks left over.

Statutory Shared Parental Pay is currently £139.58 per week, or 90% of your average weekly income. Whichever is the lower amount.

For either of you to be eligible for Shared Parental Leave, the mother must formally request an end to her maternity pay or Maternity Allowance (binding notice).

There are other conditions and eligibility criteria, depending on your specific situation. The government has a useful tool here which you can use to check if you are eligible.


Does Shared Parental Leave Change The Rules For Maternity & Paternity Leave?

Not really. Mothers can still take maternity leave under the rules which existed prior to the introduction of SPL. Fathers still get up to 2 weeks of leave, as they did before.

The main difference is that the new SPL system allows the mother to exchange her maternity leave for SPL, at any point following 2 weeks from the child’s birth.


What Is The Best Course Of Action For My Family?

It truly depends on your goals, needs, values and circumstances to answer this question.

For instance, what are you and your partner’s / spouse’s needs and expectations when it comes to raising a child?

Are you both happy to split the roles of carer / breadwinner for that first year, or is it important that both of you share in these two roles somehow?

If you both want to opt for some form of the latter course, check which options and benefits are available from your employer.

For instance, some fathers might have more generous SPL benefits offered by their employer, beyond the bare minimum. It could be, for example, that you continue to receive your full pay during your first 3 months of SPL.

Of course, you need to weigh all of this against your financial situation as well. Can you actually afford all of your monthly outgoings if you both take SPL, for instance?

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