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+

Employment lawEquality, diversity and inclusionMaternitySex discriminationOpinion

Ruling leads to changes in SMP pay rise awards

by Personnel Today 10 May 2005
by Personnel Today 10 May 2005

Michelle Alabaster’s lengthy, high-profile case against the Woolwich – now part of Barclays – ended in success last week.

Supported by the Equal Opportunities Commission, her claim that the building society owed her an additional £204.53 in maternity pay has led to changes to the statutory maternity pay (SMP) regime.

The first six weeks of SMP is paid at 90% of the woman’s average earnings. The entire 26 weeks’ SMP may also be calculated by reference to average earnings if the employee is a low earner.

Average earnings are calculated according to the employee’s earnings actually paid (including any back-dated pay rise) during the ‘relevant period’. This is the eight-week period ending with the last normal pay day before the end of the 15th week before the expected week of childbirth.

Even though the Woolwich paid Alabaster in accordance with the SMP regulations at the time, she claimed that her SMP should have taken account of a pay rise awarded after the relevant period, but before she went on maternity leave.

Her claim went all the way to the European Court of Justice (ECJ), which found that the regulations failed properly to implement EU law.

The regulations were therefore amended last month. Under the new rules, an employer must recalculate the SMP due if there is any pay rise during not only the relevant period, but also between the end of the relevant period, and the end of maternity leave (ordinary maternity leave or additional maternity leave – but not any longer period of contractual maternity leave).

An employee is now treated as if the higher earnings applied for the whole of the relevant period and so the employer is required to recalculate the SMP and pay the additional sum due.

The Court of Appeal reconsidered the position in light of the ECJ’s views, and decided that Alabaster could bring a claim under the Equal Pay Act 1970 for the £204.53.

It said that in these circumstances, Alabaster did not need to show that she had been treated differently to a male comparator.

Awarding pay rises

If you award a pay rise now, first check the effect it would have on any employees currently on maternity leave. In the event of a pay rise that is awarded now but is also backdated, you may also need to recalculate payments to any employees who were on maternity leave on the effective date for the pay rise, even if they have since returned. You must also take account of pay rises that have been awarded, but have not yet started to be paid, as the rules do not distinguish between the two.

In most cases, the recalculation will mean only a very small additional payment to the employee.

You do not have to recalculate SMP you have paid in the past that did not take a pay rise into account, but you may be vulnerable to claims if you don’t. An equal pay claim can relate to SMP paid over the previous six years, provided it is brought while the employee is still employed, or within six months of the employment ending.

Practical steps

The media and trade unions have followed this case throughout, and so affected employees are likely to be aware of their rights.

Therefore, ensure your internal procedures will now trigger a recalculation of SMP for relevant employees where pay rises are awarded. If you think that a number of employees might be affected, you may wish to carry out a risk assessment to identify them and how much they are owed.

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.

Bear in mind that, subject to the usual rules, you may be able to reclaim any additional payments you have to make from the Inland Revenue.
Consider whether you need to take any proactive steps in light of this assessment. In most organisations, the number of staff affected will be small.

Employees should not be able to bring a tribunal claim until they have raised a grievance under the new statutory dispute resolution procedures. This should enable most claims to be dealt with before they reach a tribunal.



Personnel Today

Personnel Today articles are written by an expert team of award-winning journalists who have been covering HR and L&D for many years. Some of our content is attributed to "Personnel Today" for a number of reasons, including: when numerous authors are associated with writing or editing a piece; or when the author is unknown (particularly for older articles).

previous post
Sainsbury’s slashes banking jobs
next post
Women promoted to senior posts in HR department shake-up at Asda

You may also like

Gregg Wallace case: don’t be too hasty to...

11 Jul 2025

Ministers loosen fire and rehire proposals in Employment...

10 Jul 2025

It’s no secret – parity in the workplace...

10 Jul 2025

Court of Appeal rules that Ryanair agency pilot...

9 Jul 2025

Bereavement leave to extend to miscarriages before 24...

7 Jul 2025

Company director wins £15k after being told to...

4 Jul 2025

How can HR prepare for changes to the...

3 Jul 2025

Government publishes ‘roadmap’ for Employment Rights Bill

2 Jul 2025

One in eight senior NHS managers from black...

1 Jul 2025

Government launches ‘landmark’ review of parental leave

1 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+