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What notice pay should I give my employee if she resigns whilst on maternity leave?

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This is a tricky area of employment law and will be determined by your employee’s employment contract as this will state the notice pay they are entitled to if you have chosen to go over and above the statutory entitlement. Our Employment team explain your position and how you can calculate the amount that your employee is entitled to.

If you have specified in your employee’s contract that they are only entitled to the statutory minimum notice, or less than a week more than statutory notice, she has a right to receive her full remuneration during her statutory notice period if she resigns while on maternity leave.

One key thing to understand in this situation is that even though the employee has resigned, because she is on maternity leave the law treats the resignation as the employer terminating the employment contract. Therefore, the statutory minimum notice for the employee will be determined by what is stated in their employment contract under the clause detailing the notice given by the employer.  Statutory minimum notice is one week's notice where the employee has been employed for at least a month but less than two years, and then one week's notice for each year of service up to a maximum of 12 weeks' notice.

You must pay your employee their normal full pay during the statutory notice period but can offset their maternity pay against their full pay. You do not have to make this payment until their employment has ended.

Your liability to pay your employee in full for the statutory notice period does not apply if their contract requires you to give at least one week more than the statutory minimum notice to terminate the contract.

If an employee resigns while on maternity leave and is contractually entitled to at least one week more notice than the statutory minimum, they will only be entitled to maternity pay during the notice period. If their maternity pay period has already expired, they will not receive any pay.

How to calculate maternity pay

In order to demonstrate how this complicated calculation works, we have an example below. If your employee was entitled to two weeks’ statutory notice but you enhanced this to four weeks’ notice in their employment contract, then they will only be entitled to maternity pay during the period.

If she was entitled to two weeks’ statutory notice and is contractually entitled to four weeks’ notice but her maternity pay period has already expired, she will not receive any pay. If she is entitled to two weeks’ statutory notice and this is reflected in her employment contract, because the contract does not require you to give at least one week more than the statutory minimum notice to terminate the contract, the employee must be paid in full for their two week statutory notice period.  Remember here, the maternity pay can be offset against the full pay.

This would be the same if the employee was entitled to two weeks’ statutory notice and was contractually entitled to two and a half weeks’ notice as this is less than the statutory notice and at least one more week.

We appreciate that this is a complicated area of employment law, and so would always recommend that you contact us to discuss this calculation.  You can contact a member of our experienced Employment team on 023 8071 7717 or email employment@warnergoodman.co.uk.

ENDS

This is for information purposes only and is no substitute for, and should not be interpreted as, legal advice.  All content was correct at the time of publishing and we cannot be held responsible for any changes that may invalidate this article.