Although it’s highly likely that you would have heard of the term “statutory payments” before, not many people actually know what the term means and what they are entitled to.
This blog will explain what statutory payments are, who is entitled to statutory payments, and how to figure out if you are entitled to statutory payments.
What are statutory payments?
In simple terms, statutory payments are a group of defined payments which are required to be paid for a range of different absences including maternity, paternity and adoption.
Regulations surrounding statutory pay apply to almost every type of business, operating across a diverse range of sectors.
All employers are expected to make these payments to all employees that meet the qualifying conditions, and all companies must also ensure that they are paying at least the national minimum wage or national living wage.
These payments are usually paid at a weekly rate if you are unable to come to work for a range of different reasons.
Key things to know about Statutory Payments:
When delving into the ins and outs of statutory payments, you should always consider the following factors:
- Eligibility: Each type of statutory payment has specific eligibility criteria that you will need to consider before applying. For example, qualifying conditions such as earnings threshold and length of employment are considered.
- Payment Rates: The payment rates for statutory payments are set by the Government and may change periodically. With this in mind, you should always check the current rates before applying.
- Employee Rights: All employees have the right to receive statutory payments if they meet the eligibility criteria.
- Duration: You should also be aware that there are set limits on the duration of each type of statutory payment.
- Employer Responsibilities: All employers are legally obligated to pay statutory payments to eligible employees.
Who is entitled to statutory payments?
There’s a number of different reasons why an individual may be entitled to a statutory payment including the following:
- If an employee becomes a parent
- If an employee chooses to adopt
- If an employee is laid off
- Long term cases of illness
However, in order for an employee to qualify for statutory payments, they must be an employed earner.
How long are you entitled to statutory pay?
The reason as to why you are entitled to statutory payments deters how long you may receive them for. For example, eligible employees can claim statutory maternity payments for up to 39 weeks, whereas statutory sick pay can only be paid for 28 weeks.
Over this amount of time the amount of your statutory pay will also change depending on circumstances. If an employee claims statutory maternity pay, the will receive 90 per cent of their average pay for the first six weeks and £172.48 or 90 per cent of average earnings (whichever is lower) for the next 33 weeks.
Statutory pay
As we have mentioned above payments may be required from an employer if an employee is off work for a wealth of different reasons and here is a closer look at some of those. It’s important that all employers familiarise themselves with the conditions associated with statutory pay.
Statutory Sick Pay
Many people fall ill at some point in their working lives, resulting in them unable to work for long periods of time. In instances where employees are off for a prolonged period of time, they are entitled to statutory sick pay which is generally payable for a period of up to 28 weeks.
The statutory sick pay allowance is the minimum amount of sick pay an employer must pay an employee. However, an employer does not have to pay statutory sick pay for the first three days of a sickness absence.
Statutory Maternity Pay
All mother’s to be are entitled to statutory maternity pay, giving them time off to have their baby and spend time bonding with their new arrival. All statutory maternity pay is payable for a period of up to 39 weeks.
As previously mentioned, employees will receive 90 per cent of their average pay for the first six weeks and £172.48 or 90 per cent of average earnings (whichever is lower) for duration of their time off.
Statutory Paternity Pay
And it’s not just new mums that are entitled to statutory pay, new dads are entitled to statutory paternity pay too! However, this is significantly less to statutory maternity pay, with payments provided for a period of either one or two weeks.
The weekly rate of paternity pay is also £172.48 or 90 per cent of average earnings (whichever is lower).
Statutory Adoption Pay
Payments are generally required from an employer when an employee takes time off if they have adopted a child and payment for this are usually for a period up to 39 weeks.
Adoption pay starts when you take your adoption leave and is paid the same way as maternity pay.
You can find more about statutory pay on the Gov.uk website.
How do I claim statutory payments?
The process for claiming statutory payments varies significantly depending on the specific type of statutory payment that you are applying for.
However, as a general rule of thumb, you should follow these simple steps:
First and foremost, you should always inform your employer:
If you are planning on claiming statutory payments, you should always inform your employer as quickly as possible. For example, for sick statutory pay, you should inform your employer within 7 days of being off sick, and for maternity and adoption leave, as quickly as possible!
Next, you will need to provide all necessary documentation:
It’s important that you gather all relevant documentation when applying for statutory payments. These include supporting documents such as medical certificates, adoption certificates, or other supporting documentation required. Once you have got everything you need, you will then need to submit the documents in the correct format.
What is the employer’s role in the process?
Your employer is responsible for:
- Assessing your eligibility for the statutory payment.
- Calculating the amount of payment you are entitled to.
- Making the payments to you
Finally, you should be aware that in some cases, you may need to contact the relevant authorities directly, such as the Department for Work and Pensions (DWP), in order to claim certain benefits.
What else should you be aware of?
When applying for statutory pay, you should also be aware of certain deadlines, as there are often deadlines for submitting claims and providing necessary documentation. You should also submit your claim as promptly as possible in order to avoid delays in receiving your payments.
By carefully considering these factors and following the necessary steps, you will instantly increase your chances of a successful claim for statutory payments.
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