Problem with Contractual Benefit (Maternity Leave)

buy

Hi all,

Hope this is the correct area for the below but mods please move if not...

From a blog on MSE I have just learnt that Child Care Voucher Salary Sacrifice is in fact a protected contractual benefit of employment (so covered when on Maternity leave) but through lack of previous knowledge and not being informed by the employer (not saying they should of - not sure if they're obliged to proactively provide/protect contractual benefits etc?).

Can anyone help/advise re the below (which we're absolutely devastated by)...

My understanding was that as you couldn't sacrafice SMP to cover such schemes so we thought that my wife would be kicked off the scheme and I was aware it was ending and didn't know when she'd return to work (therefore didn't know if it'd be to late to re-join).

With this in mind, I reduced the amount to 1 pound a month from when maternity leave started in hope it'd go under radar and that we'd up the value again to £243/month when Wife went back.

With wait I've now discovered, it means I've realised we've lost 2 grand!

Do any of you know of anyway we could claw this loss back please?

Thanks so much in advance.

BorisThomson

Unless the employer gave you incorrect information (and it appears they did not, you didn't ask the question), then you have no complaint against them.

The only thing I can think of is to ask the scheme provider about backdating contributions. I'd assume it is not possible, but given the amount involved it's certainly worth asking the question.

buy

Hi BorisT,

They were my thoughts too (need to check with the OH exactly what was/wasn't discussed at meeting) but that aside, backdating is doable and perfectly legal from a HMRC perspective (as long as within the same financial year). The £243/Month is simply the total annual tax free allowance (sacrifice) a lower rate tax payer can claim divided by 12 (so annual is £2916).

In theory this could all be taken from ones' pay-packet in one go (say on a month where you may be lucky enough to get an annual bonus for instance).

So there's a little light at the end of our tunnel but we are up against it and have to hope for some hear from OH's employer.

Fingers crossed!

Takeaway_Addict

buy wrote: »

Hi all,

Hope this is the correct area for the below but mods please move if not...

From a blog on MSE I have just learnt that Child Care Voucher Salary Sacrifice is in fact a protected contractual benefit of employment (so covered when on Maternity leave) but through lack of previous knowledge and not being informed by the employer (not saying they should of - not sure if they're obliged to proactively provide/protect contractual benefits etc?).

Can anyone help/advise re the below (which we're absolutely devastated by)...

My understanding was that as you couldn't sacrafice SMP to cover such schemes so we thought that my wife would be kicked off the scheme and I was aware it was ending and didn't know when she'd return to work (therefore didn't know if it'd be to late to re-join).

With this in mind, I reduced the amount to 1 pound a month from when maternity leave started in hope it'd go under radar and that we'd up the value again to £243/month when Wife went back.

With wait I've now discovered, it means I've realised we've lost 2 grand!

Do any of you know of anyway we could claw this loss back please?

Thanks so much in advance.

Apparently it isn't a protected characteristic anymore, Peninsula won a case and as such the benefit doesn't need to be paid on top of SMP...someone linked it a few months ago.

Edit: Here is an article

https://www.klglaw.co.uk/News/Childcare-vouchers.html

Geht_fit

I have just read this Law Gazette article in response to the Peninsula case:
Sorry - I can't post the link for some reason...

"What next?

It would be risky for employers to rely on this authority as the basis for any decision to stop providing any childcare vouchers to employees on maternity leave. This is particularly so for employees who are currently on maternity leave and receiving vouchers, who have an expectation that this will continue.

The decision may be appealed to the Court of Appeal, or another challenge before the EAT may result in a different conclusion – particularly as the EAT itself admitted that its conclusion should be treated with caution. Depending on how contracts and policies are drafted, employees may also have a contractual right to receive childcare vouchers during maternity leave which would still be enforceable.

Finally, it is worth noting that the government plans to implement a tax-free childcare system from 2017. This may well change the position yet again."

Takeaway_Addict

Geht_fit wrote: »

I have just read this Law Gazette article in response to the Peninsula case:
Sorry - I can't post the link for some reason...

"What next?

It would be risky for employers to rely on this authority as the basis for any decision to stop providing any childcare vouchers to employees on maternity leave. This is particularly so for employees who are currently on maternity leave and receiving vouchers, who have an expectation that this will continue.

The decision may be appealed to the Court of Appeal, or another challenge before the EAT may result in a different conclusion – particularly as the EAT itself admitted that its conclusion should be treated with caution. Depending on how contracts and policies are drafted, employees may also have a contractual right to receive childcare vouchers during maternity leave which would still be enforceable.

Finally, it is worth noting that the government plans to implement a tax-free childcare system from 2017. This may well change the position yet again."

So few employers did it anyway because of the risk of it being paid on top of SMP that the government had to bring something else in.

Why would employers pay another £3k on top of holiday on top of other costs of someone going on maternity...

buy

Thanks for all your replies regarding this.

The great news for us is that we've managed to fully resolve this. My Wife's employer backdated the payments and instructed the vouchers in time to fall into 2017/2018 tax year.

We are paying for the elements where my Wife was in receipt of her salary and the employer will be paying the elements where she was in receipt of SMP (so effectively back to where it should have been before our misunderstanding of how it works).

Thanks again for your comments.