Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Personnel Today

Register
Log in
Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+

Company carsEmployment lawMaternityLatest NewsPay & benefits

Maternity law changes may lead to bigger pension costs

by Louisa Peacock 21 Apr 2008
by Louisa Peacock 21 Apr 2008

EXCLUSIVE

Changes to maternity law introduced earlier this month could see employers lumbered with huge costs in forking out for unforeseen pension payments for women on maternity leave.

Employment experts have warned that under amendments to the Sex Discrimination Act (SDA) introduced on 6 April, employers could now be liable for pension contributions for as long as a female employee takes maternity leave – up to a year in some cases.

The legislation states that an employer only needs to pay pension contributions for a maximum of 39 weeks. But Kate Gater, partner at law firm Berwin Leighton Paisner, warned that even employees who are not eligible for statutory maternity pay because they have insufficient service could now be entitled to extended pension payments.

Gater said the confusion came from a new definition of ‘remuneration’, added to the SDA (see box). “Potentially, employers are open to claims by employees for pension payments during the whole of their maternity leave,” she told Personnel Today.

“Because the definition states ‘payments’ to the employee as meaning wages or salary, it can be argued that pensions are outside this definition, so an employer would have to continue contributions for both ordinary and additional maternity leave, whether or not the employee is getting statutory pay,” she said.

Equality campaigners have urged the government to clarify the law. Sarah Jackson, chief executive of charity Working Families, said: “This is a good example of why employees and employers alike find maternity leave and pay terribly hard to understand and to implement properly. Maternity legislation really is an area that desperately needs to be simplified.”

Sarah Williams-Gardener, director of campaign group Opportunity Now, was concerned the changes could force employers to rush implementation because they affect mothers with an expected birth date of 5 October 2008 onwards. “It’s really important the government clarifies the issue and gives employers enough time to plan and implement them properly, as they could have significant financial implications.”

A Department for Business spokeswoman insisted the changes made to the SDA would not increase employers’ costs. “When a woman is taking additional maternity leave but is not being paid, the employer is not required to make pension payments for her during this time.”

What were the amendments to the SDA?

The original intention of the SDA amendments was to allow women on maternity leave to claim for their full benefits package, including life insurance, medical cover and company cars, during additional maternity leave – but this excluded pensions.

Sign up to our weekly round-up of HR news and guidance

Receive the Personnel Today Direct e-newsletter every Wednesday

OptOut
This field is for validation purposes and should be left unchanged.

A business spokeswoman said: “The changes relate to non-paid rights throughout maternity leave, which include benefits such as company cars, gym memberships or other work-related benefits. Pensions are considered a paid right.”

However, the amendments introduced a new definition of renumeration – which lawyers claim excludes pensions – and could leave employers open to claims.

Louisa Peacock

previous post
Racist roadworkers jailed for bullying Muslim colleague
next post
Think-tank warns of management crisis in public sector as older staff retire

You may also like

Postmasters could take ownership of Post Office

14 Jul 2025

Ethnicity and disability pay gaps: Ready to report?...

14 Jul 2025

Manager dismissed after covert recording with HR wins...

14 Jul 2025

Food sector warned it is facing a workforce...

14 Jul 2025

Gregg Wallace investigation: 45 allegations upheld

14 Jul 2025

Black TV professionals’ experiences of racism are rife,...

14 Jul 2025

Steep reduction in recruitment in June

14 Jul 2025

Two-thirds drink to cope with work stress and...

14 Jul 2025

Why online training won’t help reduce sexual harassment

14 Jul 2025

Three-quarters more likely to stay with employer who...

14 Jul 2025

  • Empower and engage for the future: A revolution in talent development (webinar) WEBINAR | As organisations strive...Read more
  • Empowering working parents and productivity during the summer holidays SPONSORED | Businesses play a...Read more
  • AI is here. Your workforce should be ready. SPONSORED | From content creation...Read more

Personnel Today Jobs
 

Search Jobs

PERSONNEL TODAY

About us
Contact us
Browse all HR topics
Email newsletters
Content feeds
Cookies policy
Privacy policy
Terms and conditions

JOBS

Personnel Today Jobs
Post a job
Why advertise with us?

EVENTS & PRODUCTS

The Personnel Today Awards
The RAD Awards
Employee Benefits
Forum for Expatriate Management
OHW+
Whatmedia

ADVERTISING & PR

Advertising opportunities
Features list 2025

  • Facebook
  • Twitter
  • Instagram
  • Linkedin


© 2011 - 2025 DVV Media International Ltd

Personnel Today
  • Home
    • All PT content
  • Email sign-up
  • Topics
    • HR Practice
    • Employee relations
    • Learning & training
    • Pay & benefits
    • Wellbeing
    • Recruitment & retention
    • HR strategy
    • HR Tech
    • The HR profession
    • Global
    • All HR topics
  • Legal
    • Case law
    • Commentary
    • Flexible working
    • Legal timetable
    • Maternity & paternity
    • Shared parental leave
    • Redundancy
    • TUPE
    • Disciplinary and grievances
    • Employer’s guides
  • AWARDS
    • Personnel Today Awards
    • The RAD Awards
  • Jobs
    • Find a job
    • Jobs by email
    • Careers advice
    • Post a job
  • Brightmine
    • Learn more
    • Products
    • Free trial
    • Request a quote
  • Webinars
  • Advertise
  • OHW+