Employer maternity pay obligations explained
Statutory Maternity Pay runs for up to 39 weeks, with the first 6 weeks paid at 90% of average weekly earnings and the rest at £194.32 a week or 90% of earnings, whichever is lower, for the 2026-27 tax year [1]. Most employers then reclaim 92% of that cost from HMRC, and smaller employers reclaim 109% [1]. The obligation sits with the employer, not the state, which is why getting the process right matters.
Every UK employer with a pregnant employee carries a defined set of duties: assessing eligibility, paying the right amount on the right dates, collecting evidence, keeping records, and recovering the money owed. Missing any one of these steps can leave a business out of pocket or facing a complaint to an employment tribunal.
This article sets out what an employer must do from the moment an employee gives notice, through the payment of Statutory Maternity Pay, to the recovery of funds from HMRC. It covers the qualifying tests, the rates, the notice and evidence rules, record-keeping duties, and the options available when cash flow is tight.
Key takeaways
- Statutory Maternity Pay is paid by the employer for up to 39 weeks, then recovered in large part from HMRC.
- An employee must have 26 weeks' continuous service by the qualifying week and average earnings of at least £129 a week to qualify.
- The first 6 weeks are paid at 90% of average weekly earnings with no cap, then £194.32 a week or 90% of earnings if lower.
- Employers reclaim 92% of SMP, or 109% under Small Employers' Relief if Class 1 National Insurance was £45,000 or less in the previous tax year.
- Records must be kept for 3 years after the end of the relevant tax year.
What Statutory Maternity Pay is and who pays it
Statutory Maternity Pay (SMP) is a weekly payment an employer makes to an eligible employee who is taking maternity leave [2]. It is the legal minimum: an employer can offer a more generous contractual maternity scheme, but never less than the statutory amount. SMP is treated as earnings, so it passes through payroll subject to PAYE income tax and Class 1 National Insurance in the normal way [10].
The defining feature of SMP is that the employer pays it first and recovers most of it afterwards. The state does not pay the employee directly while the employer remains solvent and operating PAYE. That cash-flow reality is why the recovery mechanism, covered later in this article, is central to managing the obligation. Modern HMRC-recognised payroll software for SMEs calculates the weekly amount and the recoverable portion automatically, removing most of the manual arithmetic.
Self-employed people do not receive SMP because there is no employer to pay it. They may instead claim Maternity Allowance from the Department for Work and Pensions [11]. An employer who concludes that an employee does not qualify for SMP must still tell the employee why, using form SMP1, so the employee can pursue Maternity Allowance instead [6].
Which employees qualify for SMP
An employer must run two tests before paying SMP: a continuous-employment test and an earnings test. Both must be met. Getting either one wrong is the most common source of overpayment or underpayment, and both are checked against the same fixed point in the pregnancy, the qualifying week.
The continuous employment test
The employee must have been continuously employed by the same employer for at least 26 weeks running into the qualifying week, which is the 15th week before the expected week of childbirth [2]. Continuous employment means the employment relationship has not been broken, even across short gaps, and it includes time spent on sick leave, holiday, or other paid absence [11].
The qualifying week is the anchor for almost every SMP calculation, so an employer should identify it as soon as the expected week of childbirth is known [13]. A precise breakdown of how that week is fixed appears in the dedicated guide to the SMP qualifying week.
The earnings test
The employee's average weekly earnings must be at least equal to the Lower Earnings Limit, which is £129 a week for the 2026-27 tax year [1]. Average weekly earnings are calculated over the 8 weeks (or 2 months) ending with the qualifying week, using the gross pay actually made in that period [10].
If average earnings fall below £129 a week, the employee does not qualify for SMP, even with long service [2]. The employer then issues form SMP1 within 7 days of making that decision, and the employee can apply for Maternity Allowance [6].
How much SMP an employer must pay
SMP is paid for a maximum of 39 weeks, split into two pay phases. The amount changes after the sixth week, and the second phase is capped at a flat weekly rate. The table below sets out the two phases for the 2026-27 tax year [1].
| SMP phase | Weeks | Weekly amount |
|---|---|---|
| Higher rate | Weeks 1 to 6 | 90% of average weekly earnings, no cap |
| Standard rate | Weeks 7 to 39 | £194.32, or 90% of average weekly earnings if lower |
For the first 6 weeks the employee always receives 90% of their own average earnings, so a higher earner receives more than the flat rate during that phase [2]. From week 7, the employer pays the lower of the flat £194.32 or 90% of earnings, which means a lower earner can stay on the 90% figure throughout [1].
Maternity leave itself can last up to 52 weeks, so the final 13 weeks are typically unpaid because SMP stops at week 39 [11]. SMP must be paid in the same way and on the same date as the employee's normal wages, with tax and National Insurance deducted [10]. Businesses issuing a one-off HMRC-compliant payslip for a leaver part-way through a maternity period must still apply the correct phase rate.
The notice and evidence an employer must collect
SMP is not triggered automatically. The employee must give notice, and the employer must collect proof of pregnancy before paying. These two requirements protect the employer's right to reclaim the money later, because HMRC expects the evidence trail to exist.
Notice of the leave start date
The employee must give at least 28 days' notice of the date they want their SMP to start, which is usually the same date their maternity leave begins [4]. Separately, to secure the statutory leave itself, the employee should confirm the pregnancy and intended leave start at least 15 weeks before the expected week of childbirth [11].
An employer who receives valid notice must confirm the leave and the SMP start date in writing within 28 days [4]. SMP can also start automatically if the employee is absent for a pregnancy-related reason in the 4 weeks before the due date, so an employer should treat any late-pregnancy sickness absence as a potential trigger [13].
Proof of pregnancy
The employer must obtain medical evidence of the pregnancy, normally a MATB1 maternity certificate signed by a doctor or midwife, before paying SMP [3]. The MATB1 is issued no earlier than 20 weeks before the expected week of childbirth, and the employee should provide it within 21 days of the SMP start date [3].
Good practice is to take a copy of the MATB1 for the records and return the original to the employee, because the employee may need it for other purposes [5]. Without acceptable evidence, the employer is not obliged to pay SMP, and paying without it risks an unrecoverable cost [3].
Record-keeping obligations
Employers must keep SMP records for 3 years after the end of the tax year they relate to [5]. HMRC can ask to inspect these records, and an incomplete trail can undermine a recovery claim. An employer may use HMRC's form SMP2 or keep equivalent records of its own [5].
The records must show the proof of pregnancy, the date SMP started, the SMP payments made with their dates, the amount reclaimed from HMRC, and any weeks where SMP was not paid together with the reason [5]. Keeping these details inside the payroll system rather than in a separate spreadsheet reduces the risk of a gap, and an accountant payroll platform managing several clients can hold the evidence per scheme automatically.
How employers recover SMP from HMRC
The recovery mechanism is what makes SMP affordable for most businesses. An employer reclaims the cost by reducing the PAYE payment it sends to HMRC each month, reporting the recovered amount through the Employer Payment Summary (EPS) [7]. The recovery rate depends on the size of the employer, measured by its National Insurance bill in the previous tax year.
| Previous-year Class 1 National Insurance | Recovery rate | Scheme |
|---|---|---|
| Above £45,000 | 92% | Standard recovery |
| £45,000 or less | 109% | Small Employers' Relief |
A standard employer recovers 92% of the SMP paid [1]. A small employer, defined as one whose total Class 1 National Insurance was £45,000 or less in the previous tax year, recovers 100% of the SMP plus an additional 9% compensation, giving 109% in total for the 2026-27 tax year [1]. The extra 9% exists to offset the employer National Insurance the business pays on the SMP itself [7].
Statutory Sick Pay cannot be recovered at all, so SMP recovery should not be confused with the very different treatment of sickness absence [7]. The wider mechanics of reclaiming statutory pay are covered in the guide to reclaiming SMP from HMRC. Payroll software that holds the HMRC Recognised badge submits the EPS automatically and applies the correct recovery rate without manual reconfiguration.
When an employer cannot afford to pay SMP
Because the employer pays SMP before recovering it, a small business with several employees on maternity leave at once can face a genuine cash-flow problem. HMRC provides a route for this situation: an employer can apply for advance funding when it cannot afford to make the payments [8].
The application is made through an online service using the same sign-in details the employer uses for Self Assessment, VAT, or Corporation Tax, and HMRC pays the funds before the employee's leave so the employer is never out of pocket [9]. An employer that becomes insolvent must contact HMRC's National Insolvency Unit, after which HMRC pays SMP directly to the employee [8].
Protecting employment rights during maternity leave
An employer's obligations extend beyond the payment itself. The employment contract continues throughout maternity leave, so holiday continues to accrue and pension contributions usually continue on the same basis as before [2]. An employer cannot dismiss an employee or treat them detrimentally because of pregnancy or maternity leave [2].
The employee may work up to 10 Keeping in Touch (KIT) days during the maternity pay period without losing any SMP for those weeks [12]. Beyond 10 KIT days, SMP is lost for any week in which the employee works [12]. Holiday that builds up during a long maternity absence often needs careful handling at the point of return, a topic explored in the guide to the holiday pay 52-week average.
Conclusion
The employer's role in Statutory Maternity Pay is a sequence rather than a single payment: confirm eligibility against the qualifying week, collect notice and a MATB1, pay the right rate for up to 39 weeks, keep the records, and recover 92% or 109% through the EPS. Each step protects the next, and the recovery claim depends on the evidence collected at the start.
The financial weight of SMP has grown alongside the rise in employer National Insurance to 15%, which makes the 9% compensation built into Small Employers' Relief more valuable than it first appears. As payroll legislation continues to add statutory payments, the employers that cope best are those whose systems treat eligibility, payment, and recovery as one connected workflow rather than three separate tasks.
Frequently asked questions
How long does an employer have to pay Statutory Maternity Pay?
An employer pays SMP for up to 39 weeks, provided the employee remains eligible throughout [2]. The first 6 weeks are paid at 90% of average weekly earnings, and weeks 7 to 39 at £194.32 or 90% of earnings if lower for the 2026-27 tax year [1]. Maternity leave can run for 52 weeks in total, so the final weeks are usually unpaid.
Can an employer refuse to pay SMP?
An employer can only decline SMP where the employee does not meet the qualifying conditions, such as insufficient service or average earnings below £129 a week [2]. In that case the employer must issue form SMP1 explaining the decision, normally within 7 days, so the employee can claim Maternity Allowance instead [6]. An employer cannot refuse SMP to an eligible employee who has given proper notice and evidence.
What happens if a small business cannot afford to pay SMP up front?
A small business that cannot fund SMP from its own cash can apply to HMRC for advance funding before the employee's leave begins [8]. The application is made online using the employer's existing HMRC sign-in details [9]. HMRC then provides the money so the employer can pay the employee without being out of pocket.
How long must SMP records be kept?
SMP records must be kept for 3 years after the end of the tax year they relate to [5]. The records should include the proof of pregnancy, the SMP start date, the payments made and their dates, the amount reclaimed, and any unpaid weeks with the reason [5]. HMRC can inspect these records, so a complete trail protects the recovery claim.
Image prompt for Imagen (also in frontmatter)
Documentary-style wide shot, a UK small business owner sitting at a busy office desk in a converted warehouse space, reviewing a printed maternity leave letter and a payroll report, soft daylight from a north-facing window, late morning, muted earthy palette of warm grey, oak, paper white, a red-brick office building visible in the background through a window, off-centre composition with the subject in the right third, shot on a Leica Q3 at 28mm f/2.8, photojournalism, 35mm film grain, no AI artefacts, no warped hands, no warped text, landscape orientation 16:9.
