Government takes steps to ensure furlough does not affect statutory payments during maternity and other family leave

The government has introduced legislation to ensure that furlough does not affect an employee’s entitlement to statutory maternity, paternity, adoption, shared parental and parental bereavement pay or the level of their statutory pay.

Entitlement 

In order to qualify for statutory maternity, paternity, adoption, shared parental and parental bereavement pay an employee’s normal weekly earnings must be not less than the lower earnings limit. In addition, when calculating the amount of statutory pay payable to an employee on leave, you use their average weekly earnings. In both cases, you use their normal weekly earnings in an eight-week reference period.

New legislation

The legislation, which will come into force tomorrow, 25 April 2020, says that where an employee is furloughed at any time in the reference period used for calculating normal weekly earnings, normal weekly earnings must be calculated as if the person had not been furloughed. This applies where:

• The person is a furloughed employee
• The person’s employer has claimed and is in receipt of financial support in respect of the person’s earnings under the coronavirus job retention scheme 
• The person’s earnings are lower than they would otherwise have been as a result of that person being a furloughed employee

The Maternity Allowance, Statutory Maternity Pay, Statutory Paternity Pay, Statutory Adoption Pay, Statutory Shared Parental Pay and Statutory Parental Bereavement Pay (Normal Weekly Earnings etc.) (Coronavirus) (Amendment) Regulations 2020 apply where the first day of leave in respect of which payment is to be made is on or after 25 April.