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Cash v Benefit In Kind during maternity: myth/fact?

At a recent CIPP National Forum held at Ceridian’s office in Glasgow, Simon Parsons gave a presentation surrounding the Myths of Payroll.

This month we’ve pulled out the myths and facts relating to Cash v Benefit In Kind (BIK) during maternity. Next month we’ll look at the common myths relating to Auto-Enrolment.

Myth or fact?

Myth

Employees in receipt of Car Allowance must also receive this benefit during maternity leave.

Fact

Employees are not statutory entitled to any cash benefits during maternity leave. The Car Allowance will have been included in the average pay calculations.

Myth

Salary Sacrifice arranged non-cash BIKs can be stopped during maternity.

Fact

Employers must continue to provide all non-cash BIKs during maternity leave (52 weeks).

Myth

Employer pension contributions are now due for all of maternity leave.

Fact

Employer pension contributions are due as if the employee were working normally during all periods of paid maternity leave (generally 39 weeks), or for the first 26 weeks if there is no maternity pay.

Are there any other payroll myths out there that you think need bursting?
Put your questions to Simon Parsons using the comments area below.

  • 16th July 2013
  • Payroll
  • 2 Comments

2 Comments

1

Jo Bolland

When a woman goes on maternity leave she accrues holiday.

If she remains on maternity leave for 12 months, 12 months holdiay entitlement has accured.

Assuming the woman does not want to forefit this leave, can we insist that she ends her maternity leave early and takes accured holidays (provided she is not off for more than 12 months)?

Or, can we apply normal holiday roll over rules i.e. if the holiday is not taken by April it is lost?

Or, can we insist on making a payment in lieu of holiday?
and asking the woman to come back at the end of the 12 month period?

2

P Simon Parsons

Hi Jo

No is the answer to most of your suggestions. An employee is entitled to 12 months leave as a right.

You cannot attempt to circumvent or curtail this or suggest loss of holiday entitlements. If you did then it could lead to a discrimination IT claim.

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