Business Newsletters - Spring 2007

Blooming Maternity Pay!

The Work and Families Act of 2006 introduces some fundamental changes to Statutory Maternity Pay (SMP) for babies due on or after 1 April 2007.

The maternity pay period, for which SMP is payable, is extended from 26 weeks to 39 weeks. This is paid for the first six weeks at 90% of average weekly earnings. The remaining weeks are paid at the lower of the standard rate of SMP or the earnings related rate.

From 6 April 2007 the standard rate of SMP is increased from £108.85 per week to £112.75 per week.

Women who became pregnant before they started to work for their employer or who do not earn the national insurance lower earnings limit (currently £84 a week rising to £87 per week from 6 April 2007) are not entitled to SMP. They may however be eligible to claim Maternity Allowance (MA) which is a state benefit paid directly by the government to the employee. The payment period for MA is also extended for babies due from 1 April 2007.

For babies due from 1 April 2007 all mothers will be entitled to 52 weeks leave whether or not they qualify for SMP.

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