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Maternity Pay and Maternity Leave - Advice from ASDA Finance

Maternity Pay and Benefits - Paying for baby

Having a baby is a hugely exciting – and potentially expensive time. Not only are parents faced with the cost of feeding and clothing a new child, there’s the cost of time away from work.

So it makes sense to examine what maternity pay, leave and other benefits you’ll be entitled to from an employer and the state.

Maternity pay – what you need to know

If you've worked for your employer for 26 weeks by the time you are 15 weeks away from giving birth, and you're earning more than an average of £97 a week before tax, you're entitled to Statutory Maternity Pay (SMP) from your employer.

If you're unemployed or have been in your current job less than 26 weeks, you're entitled to Maternity Allowance, which is paid by the state.

Over the last 13 years, the length of paid maternity leave has more than doubled. Back in 1997, you could only claim 18 weeks SMP - six weeks paid maternity leave at 90% of your weekly salary and then an extra 12 weeks on a flat rate of £55.70.

Today, you can claim SMP for up to 39 weeks but you need to tell your employer at least 28 days before the date you want to start claiming it. The earliest you can take paid maternity leave is 11 weeks before your baby is due. The latest is the day after the birth.

How much maternity pay will I get?

The amount paid by your employer depends on whether it has its own maternity pay scheme.

Check with your HR department for the exact details, but some companies pay your full salary for the first six weeks of your maternity leave, whereas SMP is calculated as 90% of your average weekly earnings for the first six weeks, then up to £124.88 for the remaining 33 weeks.

Generally, a company with a staff of more than 50 is likely to offer contractual maternity pay. Some firms will pay up to 100% of your salary for the full six weeks, but often they will include a contractual clause which would say this is on the assumption the employee is going to return to work. An employer cannot pay less than SMP.

Paternity Pay and Paternity Leave – Money for Dads

Expectant fathers may be able to claim two weeks' Statutory Paternity Pay from their employer if they are: the biological father or taking responsibility for the child's upbringing, earning more than £97 a week and have been working for their employer for 26 weeks by the 15th week before the baby is due.

Maternity benefits – what else is there?

Your employer must continue to give you your contractual benefits, for example gym membership and your pension throughout your maternity leave, which can be up to 52 weeks in total.

You can also take up to 10 'Keep In Touch' days, which allow you to come into the office during your maternity leave. You’ll get paid for time worked, without your maternity pay being affected.

There are also a number of financial benefits from the Government for expectant and new mums, which can help with the costs of bringing up a baby.

All mums-to-be can claim a one-off tax-free payment of £190, called the Health In Pregnancy Grant. Once you are more than 25 weeks pregnant, you can get a claim form from your midwife, who will confirm your due date.

The Sure Start Maternity Grant is a one-off tax-free payment of £500 to help with the cost of bringing up your child, if you or your partner is on Income Support or Jobseeker's Allowance.

Once your baby is born, you may be entitled to tax credits if you work, but earn a low wage. Meanwhile, any parent with children under 16 can claim Child Benefit - £20.30 a week for your eldest child and £13.40 a week for each of your other children.

If you're on benefits or you're pregnant and under 18, you could qualify for Healthy Start vouchers, worth £3.10 a week, which can be used to buy milk, fruit and vegetables.

For more details about maternity pay, leave and benefits and exactly what you are entitled to go to the Government’s Directgov website.

If you’ve got a little one on the way why not request an application pack with details on setting up an Asda Child Trust Fund provided by The Children’s Mutual?