A five-person architecture practice is told in week fourteen of a pregnancy, earlier than the employee had to say anything, because she likes her boss. His first thought is that he cannot afford it. His second, after a conversation with his accountant, is that most of the pay is recoverable and that he has roughly six months to sort out cover.
That six months is the whole advantage. Almost nothing else in employment law gives you half a year of notice.
The leave is a day-one right and the pay is not
Every employee is entitled to fifty-two weeks of statutory maternity leave: twenty-six weeks of ordinary maternity leave and twenty-six weeks of additional maternity leave. There is no qualifying period. Someone who started last month has the same entitlement as someone who has been there a decade.
Two weeks of that leave are compulsory, four in a factory, and an employee cannot work during them.
Statutory maternity pay is a separate test. To qualify, an employee needs twenty-six weeks of continuous employment with you by the end of the qualifying week, which is the fifteenth week before the expected week of childbirth, and average weekly earnings at or above the Lower Earnings Limit. If they do not qualify, they are still entitled to the leave, and they may be able to claim Maternity Allowance from the Department for Work and Pensions instead. You give them form SMP1 to explain why you are not paying.
Where it is payable, statutory maternity pay runs for thirty-nine weeks. The first six weeks are paid at 90% of the employee's average weekly earnings with no cap. The remaining thirty-three weeks are paid at a flat statutory rate or 90% of average weekly earnings, whichever is lower. The flat rate was £187.18 a week from April 2025 and is reviewed each April.
The notice requirements are worth knowing because they give you your planning window. The employee must tell you by the end of the qualifying week that she is pregnant, when the baby is due and when she intends to start her leave, and provide a MATB1 certificate. You must write back within twenty-eight days confirming the date her leave will end. That letter is not a formality: if you do not send it, you lose the ability to insist on notice when she wants to change her return date.
You get most of the money back
Employers can recover 92% of statutory maternity, paternity, adoption, shared parental and parental bereavement pay. Small employers recover more than they paid out under Small Employers' Relief: if your total Class 1 National Insurance liability in the previous tax year was at or below a defined threshold, £45,000 for some years now, you reclaim 103% of the statutory payments. The extra 3% is a rough allowance for the employer National Insurance you paid on them.
Recovery is made through your payroll by reducing the PAYE and National Insurance you send to HMRC. If the amounts you are recovering exceed what you owe, you can apply for advance funding rather than carrying it.
Two costs are not recovered. Any contractual maternity pay you offer above the statutory scheme is entirely yours. And holiday continues to accrue throughout the full fifty-two weeks of leave, including the unpaid portion, which means an employee returning after a year comes back with a year's untaken holiday. Plan that into the return rather than discovering it in week one.
Pension contributions also continue during paid maternity leave. Your employer contribution is based on the salary she would have received, not on the statutory pay she is actually getting, while her own contribution is based on what she receives.
Keeping in touch days exist to make the return easier
An employee can work up to ten keeping in touch days during maternity leave without ending the leave or losing statutory maternity pay for that week. They are optional on both sides. You cannot require them and she cannot demand them.
Used well, they are the single best tool you have. A day in the office to meet a new member of staff, a half day to be briefed on a project she will pick up, a team meeting she wants to be at. The point is that an employee who has been entirely absent for a year returns as a stranger to her own job, and that is the return most likely to end in a resignation three months later.
Agree what a keeping in touch day is worth before the first one. The law does not set a rate, so pay normal daily pay for it, and be clear whether statutory maternity pay for that week is topped up or offset.
Shared parental leave sits alongside this. Where both parents qualify, up to fifty weeks of leave and thirty-seven weeks of pay can be shared, taken in up to three blocks each. Paternity leave is one or two weeks, and since April 2024 the two weeks can be taken as two separate blocks at any point in the first year rather than in one go immediately after the birth. Pay is at the same flat statutory rate or 90% of average weekly earnings if lower.
The right to return is stronger than most employers realise
An employee returning at the end of ordinary maternity leave, within the first twenty-six weeks, is entitled to return to the same job on the same terms. Returning after additional maternity leave, she is entitled to return to the same job unless that is not reasonably practicable, in which case a suitable and appropriate alternative on terms no less favourable.
Redundancy protection has been extended. Under the Protection from Redundancy (Pregnancy and Family Leave) Act 2023 and the regulations made under it, the priority right to be offered a suitable alternative vacancy in a redundancy situation now covers a protected period that begins when the employee tells you she is pregnant and continues until eighteen months after the birth. It is a priority over other redundancy candidates, which is unusual and easy to get wrong.
Health and safety is a live duty too. Under the Management of Health and Safety at Work Regulations 1999 you must assess risks to new and expectant mothers and, where a risk cannot be removed, alter working conditions or hours, offer suitable alternative work, or suspend on full pay. Pregnancy and maternity are also protected characteristics under the Equality Act 2010, which means unfavourable treatment because of pregnancy or maternity leave does not require a comparator and does not have a qualifying period.
The planning itself is the easy bit once you accept it is happening. Decide early whether you are covering with a fixed-term hire, an agency, redistribution among the team, or by declining work for a period. A fixed-term contract to cover maternity leave is legitimate, and should say so explicitly. Handover should start weeks before the leave does, and should produce written notes rather than a conversation. And be honest about the return: many people come back on different hours, and a flexible working request from a returning parent is now a day-one right that you have to deal with properly rather than refuse by instinct.
Where this shows up in the game
Business Baron staffs a business with people who have lives. Pregnancies happen, leave is taken, and cover has to be arranged from a limited pool in a specific town. The statutory pay is recoverable and the productivity is not, so you feel the gap in output rather than in the wage bill. Handle a return badly and you lose someone you trained. In a firm of five the first maternity leave is usually the first real test of how thin you have run your staffing.