I am currrently drafting the details of a childcare voucher scheme for my organisation. We wll producing our own vouchers as we are such a small employer.

However one facet of the scheme that is giving cause for concern is that generally the advice given is for a pregnant female employee to opt out, using the life style change provisions, of the scheme to maximise her SMP. If however she wished for any existing children to continue in childcare during the ordinary maternity leave period and did not opt out would a childcare voucher be regarded as a benefit that requires to be paid during the OML period?

As a small employer this could cause a considerable cost to the organisation should this arise as maternity pay within the organisation is restricted purely to that required by statutory legislation. For a monthly paid employee it could end up costing the employer an additional £177 (after allowing for the employer’s 92% recovery rate and the employers NIC contirbution).

Have I missed anything in the legislation to prevent this? If not does anyone have an example of wording to get around this potential problem?


Sheena Henderson