Maternity, adoption, shared parental pay and childcare vouchers

Childcare voucher salary sacrifice whilst receiving maternity, adoption, or shared parental pay

This note sets out the factors to consider when decidingwhether to make a salary sacrifice for childcare whilst takingeither maternity, adoption, or shared parental leave and pay.

General Information

1.1Your pay during maternity, adoption, or shared parental leave depends upon your length of service with the College and the terms of your employment contract. For full details, please check the appendices to the College’s Maternity, Adoption/Surrogacyand Shared Parental Leave policies. Your local HR representative will also be able to provide guidance on your entitlement.

1.2If you have worked for the College for more than a year, you are entitled to receive, as appropriate:

Up to either 18 weeks’ full maternity or adoption payor 16 weeks’ full shared parental pay*or, where appropriate, a combination of full maternity, adoption, pay and full shared parental pay up to a total of 18 weeks’ full pay (i.e. calculated before any salary sacrifice has been made), followed by up to 21 weeks’ SMP/SAP/ShPP* followed by a maximum of 13 weeks’ unpaid leave**.

*SMP – Statutory Maternity Pay, SAP – statutory Adoption Pay, ShPP – Statutory Shared Parental Pay

**Please note that when a member of staff is in receipt of College Maternity/ Adoption Pay/Statutory Maternity/Adoption/ Pay, in addition to College Shared Parental Pay and/or Statutory Shared Parental Pay, no combination of payments will exceed a total of 18 weeks at full pay plus 21 weeks at the statutory rate. Where both parents work for the College, the combined payments made to both members of staff (College Maternity/Adoption Pay/Statutory Maternity/Adoption Pay and/or College Shared Parental Pay and/or Statutory Shared Parental Pay) will not exceed a total of 18 weeks at full pay plus 21 weeks at the statutory rate.

1.3The current rate of SMP/SAP/ShPP can be found on the Government web-site:

1.4When calculating SMP/SAP/ShPP, the term “gross average earnings” means your gross earnings over a period of at least eight weeks up to and including the last pay day before the end of your qualifying week. The qualifying week is the 15th week before the week your baby is due.

1.5SMP/SAP/ShPP is paid through Imperial College’s payroll, alongside any contractual pay to which you are entitled.

1.6For the purposes of Maternity Leave only, mothers who do not qualify for SMP, as set out in the College’s Maternity Policy, may be eligible to claim Maternity Allowance, provided they meet the qualifying conditions, which are based on recent employment and earnings.

Maternity Allowance is paid at the same weekly rate as SMP. Maternity Allowance is not paid through College’s payroll, applications should be made directly through the mother’s local Social Security/Job Centre Plus Office. Please see point 4.2 of the College’s Maternity policy or visit for further information.

1.7Mothers who are entitled to the enhanced College payment, as set out at point 1.2 above, should note that during the 13 weeks of unpaid leave theyare not entitled to claim Maternity Allowance (see point 1.6 above).

Effect of making a salary sacrifice

2.1If you make a salary sacrifice:-

(i)your entitlement to contractual full pay (set out at section 1.2 above for the initial period will be unaffected;but

(ii)your earnings during the qualifying period for the purposes of calculating your entitlement to SMP (or MA, if applicable), SAP or ShPP will be reduced by the amount of the salary sacrifice (please see point 1.4 above).

After taking off all salary sacrifices, if your average earnings during this period are less than the lower earnings limit, you will not be entitled to receive SMP, SAP. In this instance you may wish to consider discontinuing your salary sacrifice before the beginning of the qualifying period.

2.2Most mothers/parents who are College employees will be unaffected by this, because their earnings are substantially above the level at which this limitation applies. Their entitlement to SMP, MA, SAPor ShPP will be the flat rate.

Continuing childcare during a period of maternity leave

3.1This will only happen for your 2nd or subsequent child, where childcare is needed for your first (or earlier) child.

3.2You may continue with your salary sacrifice if you wish, and the amount sacrificed will reduce your full pay or half pay as the case may be.

3.3However, it is unlawful to make a salary sacrifice out of SMP, SAP orShPP.The College’s current practice is to continue to provide childcare vouchers or facilities during the period of SMP, SAP orShPP and any subsequent unpaid leave, at its own cost, at the same monthly rate as applied when your earnings were sufficient to meet the cost from your contractual pay. However, the College may review this practice from time to time and reserves the right to amend or discontinue provision of childcare vouchers or facilities during periods of leave when your earnings are insufficient to meet the cost.

3.4The provision of childcare vouchers or facilities during periods of SMP, SAP or ShPP and any subsequent unpaid leave which is set out above applies only if you have been receiving childcare vouchers or paying childcare costs through salary sacrifice throughout the eight week period leading up to the qualifying week. (See paragraph 1.4, above).

MAA

Updated October 2016