Statutory Maternity pay Vs. Allowance employment dispute. Help please!

creative-highs

Hi everyone! I'd much appreciate some help with this issue, its a beast, I warn you! Basically, the law has changed between the time I was assessed for Stat Mat pay at which time, I qualified, and the time I started my Mat. Leave (which suddenly DISQUALIFIED me after a positive descision was already issued). I apologise for the collossal amount of text I am going to leave below but I want to give you a proper overview of the situation. If anyone can advise whether I should do anything or not or if I even can then great.

Correspondance to the large company who employs me;

The situation is as such:
On the 7th of April I started maternity leave, with intention to return to work this October. I have worked for * since February 2012.

As directed by the company guidelines, I informed my line managers, Area manager AND HR of my pregnancy as soon as appropriate (in fact, earlier than required) and submitted the full documentation that employee pregnancy entails to HR before the prescribed deadline of 15 weeks before baby's due-date.

I waited a very long time for a reply and was concerned that it hadn't even been received. It took a couple of months, not the 10 days stated (in company literature) to send me information or grant a decision on my statutory maternity pay. Concerned, I had discussions with *, and * on the phone and via my manager through company email system.
When I did get confirmation, there were errors on the letter, which after another email from me, was gladly resolved.

I was well aware that my average pay, during quiet times (our shop is particularly quiet on days that I have been at work since last year's peak season ended) was right on the cusp of eligibility for Statatory Maternity Pay.

My luck was riding on whether I'd earn enough commission to bring me above the threshold during the 'assessment period', which was going to be a tall order considering that during the 2nd and 3rd trimester of my pregnancy I have (as instructed by management) taken on a more administrative role instead of my usual sales role within the store, being responsible (during my shifts) for the majority of communications and inter branch stock ordering. My sales during this time have been pitiful compared to previous performance partially due to that, and also from having to elect to work on quieter mid-week days to accommodate my 5 year old starting school last September.

Due to my concerns over whether I would qualify or not, I ensured that I applied in plenty good-time, so that should disappointment come, I could best prepare for it long before my baby was due, thus avoiding additional stress.

Imagine how amazed and happy I was when * sent me confirmation that I WAS to be entitled to maternity pay afterall, wishing me a happy leave. Dubious as mistakes had been made previously, I double checked with her that I was definitely to receive it and was glad to receive a positive response in return.

It seemed all my problems were solved, and that I could enjoy maternity leave without worrying too much. I should have liked to take a year off to nurse my baby, but decided better to come back to the company after just 6 months, so that I knew I could meet living costs. It takes a colossal amount of weighing-up and calculations to make these big life decisions, and they could only be made dependant on what information I had from *.

The real crux of the issue is this: a few days ago, 2 weeks into my maternity leave, just before the bank holidays, I received a letter from * stating that unfortunately, I'd not be eligible for Maternity Pay after-all!

Enclosed, was the MATB1 certificate that I supplied months ago. To rub salt in the wound, I had to spend money to go to collect the letter from a sorting office.

I have to tell you, I was crushed. It ruined my weekend for worry, and brought considerable stress on me (now less than a month away from baby's due date).

Here I was, with so little time until my new arrival is due, just 10 days or so shy of pay-day being faced with the fact that I was only to be paid for two or three shifts for the entire month, a quarter of my expected pay. This means I cannot meet my rent this month, or indeed, anything else.

Alongside my job at *, I also run my own full-time well-established costume and formal-wear design business. The earnings are almost as paltry as my minimum wage from * but I put just as much love and effort in and I work hard to provide for my family.

My self employment should, in theory, entitle me to Maternity Allowance, but, you realise, applying for it could be a long and arduous experience and my payments may not start until long after the baby is due now. I need days to make up my accounts books to a standard to be able to apply, as they are only made up to the last self-assessment tax return that was due.

If I'd have only been told the correct information when I applied for maternity pay, then I'd not be in this horrid, stressful mess, and I've had started receiving my allowance soon, leaving no deficit in my finances. Also, I'd have saved what I could of my business income (of which I shall not receive more of now until the influx of new orders in winter time).

Safe in the (ill-advised) 'knowledge' that I was due maternity pay, I have been refusing many hundreds of pounds worth of design work since I was 'granted' the pay, that in retrospect, I really should have taken up, despite needing a rest from the crazy maintaining of two jobs that I've been sustaining for the last few years.

Personally, I feel my intelligence is somewhat insulted by the explanation on the little note accompanying my disappointing refusal letter. The note claims that 'changes in earning limits' means I no longer qualify. If I qualified in the official (and SET, unchangeable) 'qualifying week' as indicated by the initial decision, then how on earth is it possible that either my earnings or the limits have changed for a period since-passed that I had already been assessed and approved for? It is what it is, and the goalposts can't change retrospectively, so the only feasible explanation is that an error was made in the calculation.

We are all human and make errors, I would have understood if this had been explained to me and perhaps apologised for, in time for me to seek a solution for my finances elsewhere.

It would have meant disappointment for me, but I don't seek to claim that which I do not deserve and I would have been understanding that someone could make an honest mistake. I don't pertain to be a person without fault and would have taken the news with grace.

To summarise, this unfortunate mistake (and the very late realisation of said mistake) has cost me my sleep, which as you can imagine is valuable to my health especially, right now and also it has cost me financially in more ways than one.

For example, the refusal of offered work and the miscalculation of my personal budget because I accounted for income which now does not exist. This leaves me with an over-spend that I could have saved. My rent is due on pay-day, and I shall have nothing but an excuse for my landlord.

This should be an exciting and happy time, and if the situation had remained as planned, I'd be well prepared and able to relax now. Instead, my head is swimming night and day for a way to bring about a situation where I can simply 'tread water'.

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(the above was from me to my employers head office)

I received a short reply stating within:

"The current lower earnings level to qualify for SMP has been increased to £111 per week (or £481 per month or more) from 6th April 2014. As your qualifying earnings were £434.94 per month in the given period, you unfortunately do not meet the criteria to qualify for Statutory Maternity Pay. !
!
The calculation is based on your actual earnings and the lower earnings level in the current tax year, this caused you not to meet this particular condition.
!
We have now forwarded you your SMP1 Form, which will enable you to claim Maternity Allowance, should you wish to do so." !
!

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to which I replied:

"Thanks for the informative response, but somewhat missing the point I'm afraid.
The issue for me wasn't the fact that I didn't qualify, I'd have understood if I had been told within a decent period after I'd applied. My forms were all on time after-all.
What was the need to wait until I was already on maternity leave until I was informed? Surely the government gave companies the heads up when the decided to change the limits?
My upset was because I haven't been informed within time enough to do anything about it in time for the baby and it has now caused me hardship at a time that I really needed to be without it. I should have applied for Maternity Allowance a long time ago but was unable to do so. My forms reached you in early February. The fact that I may be able to apply late and receive the allowance later is irrelevant. The need to feel prepared and not under stress was paramount to me.
Thanks for the apology though.
I would like to know why there was such a delay to inform me please as I am still extremely disgruntled about the situation. The explanation still doesn't remove the fact that I have refused hundreds of pounds worth of self-employed work as a direct result of labouring under the belief that I was to receive pay and could forgo the extra income."

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their reply was;

" apologise for the delay in informing you, the issue only came apparent when we entered your details this month into the payroll system which made the calculation. Reading your e-mail I can see why this delay would be extremely unsatisfactory.
!
As a result of your e-mail I have spoken to our software supplier to see how we can enter the details on to the system earlier so to avoid this happening in the future."

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my last word on the subject to date:

"Thank you for explaining. I am satisfied with your answer, though this should never have happened.

It should have been so that the department were abreast of changes in the law that affected their calculations, so that employees aren't misinformed.

There are actually some helpful calculators on HMRCs website specifically designed to help employers to calculate these things accurately. Perhaps in the interim they might be of use so that other employees don't fall foul of the system.

HMRCs guidelines do also state that employees should have a definite decision within 28 days of application (company guidelines say within 10 days I believe) . I know not yet where the law stands on withdrawing at the last minute but I shall find out.

I appreciate your correspondence, and thank you sincerely for your speedy replies on the matter. At the moment I've said all I need to and am glad that you are looking into preventing this from happening to others."

!

Believe it or not I trimmed down the correspondance but if you are still reading then thanks! And well done. Anyone have any opinions on the matter? One massive concern is that I am not as up to date with my Nat Ins. Contributions as I'd like to be as I am living as a single mother (albeit a VERY hardworking one with two jobs). This might mean I don't qualify for maternity allowance either?

Any assistance would be gratefully received.

creative-highs

Baby is due on the 22nd May. But I had to apply for Stat pay before 5th Feb, which I did.

I'm not entirely sure what they've done, but my 'qualifying weeks' for assessment would have fallen in feb or march, but they've applied that to the NEW LEL which was introduced just 2 weeks ago.

chrisbur

A couple of points which may or may not help.
1 Your employer advises
"The current lower earnings level to qualify for SMP has been increased to £111 per week (or £481 per month or more) from 6th April 2014. As your qualifying earnings were £434.94 per month in the given period, you unfortunately do not meet the criteria to qualify for Statutory Maternity Pay. !
The calculation is based on your actual earnings and the lower earnings level in the current tax year, this caused you not to meet this particular condition."

They are suggesting that the problem stems from the change to the LEL but with monthly earnings of £434.94 you were below the LEL for last year and the two years before that suggesting that the employer had not actually checked entitlement when they claim they had.
Have you checked their calculation?

2 The E15 guide for last year advises that to qualify you must
"have AWE which are not less than the lower earnings limit for payment of NICs which applies on the Saturday of the QW"
The Saturday of the QW would fall in last tax year so £109 per week would be needed.
Has this been changed, the SMP calculator seems to have been changed and there is no E15 issued this year. The only guidance seems to be limited online stuff and the SMP calculator, I have not been able to track down anything that confirms a change in the rules nor anything to confirm that they have not changed.

But assuming your employer's calculation is correct then whether changed or not I am afraid that you did not qualify as your earnings as said before were to low for both years.

anmarj

chrisbur wrote: »

Has this been changed, the SMP calculator seems to have been changed and there is no E15 issued this year. The only guidance seems to be limited online stuff and the SMP calculator, I have not been able to track down anything that confirms a change in the rules nor anything to confirm that they have not changed.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/275291/Benefit_and_Pension_rates_2014-15.pdf

page 13 this list the benefits uprating applying from April which is published in January each year if that is what you are meaning

creative-highs

Thank you all for your detailed and helpful replies. I thought that I'd be just under the qualifying amount (for last years LEL) unless by some miracle, I earned enough commission in my sales based job to bring me above the threshold. I only needed a few extra pounds per week by my calculation. I think my employers didn't check carefully enough. I did the calculation using the link recommended before I applied, and thought it worth a punt because my commission might have brought me just over.
My main problem is that they have withdrawn their positive descision way too late. Its cost me financially in several ways that they gave the wrong descision.

Anyone know what happens if you apply for maternity allowance but have outstanding NIC class 2 to pay?

Thank you all again.

Savvy_Sue

Are you in a union? (I fear I know the answer.)

The thing is, you may not technically qualify for SMP, BUT you could argue that as you were advised you would be, your employer should pay it anyway. There is nothing to stop them doing so.

chrisbur

Savvy_Sue wrote: »

Are you in a union? (I fear I know the answer.)

The thing is, you may not technically qualify for SMP, BUT you could argue that as you were advised you would be, your employer should pay it anyway. There is nothing to stop them doing so.

A very good point as your employer could not have done a proper check at the time they advised you that you would qualify as on these earnings you would not have qualified using the LEL for the last four years. Your employer saying your non-qualifying is due to an increase in the LEL is a lie.

chrisbur

anmarj wrote: »

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/275291/Benefit_and_Pension_rates_2014-15.pdf

page 13 this list the benefits uprating applying from April which is published in January each year if that is what you are meaning

No this is not what I was referring to. The E15 was a guide for employers on how to operate SMP this was last issued for 2013/2014 and is no longer issued. This book advised that the LEL to be used was the one that applied on the Saturday of the QW. It did not matter that the LEL changed in April. If the baby is born after the April change but the QW was before April it was the pre-April change LEL that was used not the new one. It is this rule that seems to have changed in the SMP calculator and with no E15 now there seems to be no way to check if this is correct.

Takeaway_Addict

Savvy_Sue wrote: »

Are you in a union? (I fear I know the answer.)

The thing is, you may not technically qualify for SMP, BUT you could argue that as you were advised you would be, your employer should pay it anyway. There is nothing to stop them doing so.

You could argue it but as the OP accepts mistakes happen and the employer shouldn't pay anything except losses. So if the OP cannot get other payments she should be allowed then she would have a case to get some monies back.

There is also nothing to stop them paying a million pound to the OP but if not legally required then there is no reason to do so.

creative-highs

Thank you all very much for your assistance.

pelirocco

Savvy_Sue wrote: »

Are you in a union? (I fear I know the answer.)

The thing is, you may not technically qualify for SMP, BUT you could argue that as you were advised you would be, your employer should pay it anyway. There is nothing to stop them doing so.

They could pay the OP , but they couldnt pay '' Statutory Maternity Pay '

But as with all such matters it is up to the individual to check the figures , beides the OP has said she didnt expect her earnings to have been high enough anyway