Is your business ready to process new maternity and paternity rates?
With so many changes hitting businesses in April, it is difficult to keep track of them all.
One that may slip under the radar for some business owners is the change to maternity and paternity pay.
As this will take effect from the new tax year, it is vital that businesses are prepared to handle the changes to payroll processing.
What is changing with maternity and paternity pay?
From 6 April 2026, both Statutory Maternity Pay (SMP) and Statutory Paternity Pay (SPP) will be increasing.
Both are increasing from £187.18 a week to £194.32 a week.
Paternity leave is becoming a day one right to better align it with provisions for maternity leave.
However, another change that may impact the way that your payroll processes maternity pay is with the amount payable for the first six weeks of maternity leave.
This is the period of time before SMP takes effect and is instead calculated at 90 per cent of the employee’s weekly salary.
Even in the remaining 33 weeks, your employee is entitled to the lower of either SMP or 90 per cent of their weekly salary.
These calculations will be affected by the changes to the National Minimum Wage (NMW) and the National Living Wage (NLW).
Both the NMW and NLW will have increased just days before on 1 April, so it will be these new rates that are utilised when calculating maternity pay.
Even if you pay employees above NMW or NLW, you should be aware that pay rises are anticipated by many employees to ensure that there is still an appropriate reward based on qualification and experience.
How can businesses stay compliant with maternity and paternity pay changes?
As they come on the back of rising wages and alongside changes to Statutory Sick Pay (SSP), it may feel like an overwhelming time for many businesses.
Increases in operational costs are not helping the situation and it can feel as though many business owners are being left to manage increasing responsibilities and rising bills.
Seeking financial advice and support is the best way to stay compliant with the changes as they come.
There is a strong financial implication to the Employment Rights Act that will continue to affect change throughout this year and 2027, so understanding what is changing and when is vital.
Our team are on hand to support you during this process so that you can stay confident with compliance.
We can manage your payroll for you so that you can focus on running your business.
Protect the new parents on your team by speaking to our experts today.
