Definition
An enhanced maternity pay scheme offered by an employer that exceeds the statutory minimum. Occupational maternity pay (OMP) is a contractual benefit, not a legal requirement, and varies widely between organisations.
UK Context
There is no legal obligation for UK employers to offer occupational maternity pay beyond SMP. However, the Equality Act 2010 requires that any enhanced scheme is offered on a non-discriminatory basis. HMRC allows employers to offset SMP against their National Insurance contributions. Enhanced maternity pay must be clearly set out in the written statement of employment particulars.
Best Practices
- Document the OMP scheme in a standalone maternity policy and reference it in employment contracts
- Include clear clawback provisions if repayment is expected when an employee does not return after maternity leave
- Review the scheme annually to ensure it remains competitive within your sector
- Ensure pension contributions continue during paid maternity leave as required by auto-enrolment rules
Frequently Asked Questions
Is occupational maternity pay a legal requirement?
No. UK employers are only legally required to pay Statutory Maternity Pay (SMP) to eligible employees. Occupational maternity pay is an enhanced contractual benefit that employers choose to offer.
Can an employer require repayment of occupational maternity pay?
Yes, many employers include a clawback clause requiring partial or full repayment if the employee does not return to work for a specified period after maternity leave. This must be clearly stated in the contract or policy.
Does occupational maternity pay affect SMP entitlement?
No. SMP is a statutory entitlement and is paid regardless of any occupational scheme. Employers typically pay OMP inclusive of SMP, meaning the statutory element forms part of the enhanced payment rather than being added on top.