Accurate calculation of Statutory Maternity Pay (SMP) and Statutory Paternity Pay (SPP) is crucial to ensure employees receive the correct entitlements and to maintain compliance with statutory regulations.
The incorrect calculation of SMP or SPP often arises from improperly configured pay days for maintaining SSP/SMP pay days. The system may be calculating employee earnings for payroll periods that precede the required 8 weeks before their qualifying week.
To ensure accurate calculations for the 8 weeks before the qualifying week, you need to correct the SSP/SMP pay days each month.
To do this, follow the steps below.
Check actual pay
To do this, follow the steps in the relevant section below.
📌Note: We recommend you test this in the UAT environment before making any changes to Live environment.
Portal
Click Settings then click UK Tax Rates.
Click General then click Average Pay / Pay Days.
From the Pay Group drop-down menu, select the relevant pay group.
Check that the monthly pay day is set to the actual pay day within the month, rather than the last day of the month.
Remember, the qualifying week starts on the Sunday of a given week and includes the following six days, ending on Saturday.
Click Save.
Back Office
Click CorePay then click Reference.
Click Maintain Statutory Pay Parameters then click Average Pay / Pay Days.
Click Maintain SSP/SMP Pay Days for Pay Group.
Check that the monthly pay day is set to the actual pay day within the month, rather than the last day of the month.
Remember, the qualifying week starts on the Sunday of a given week and includes the following six days, ending on Saturday.
Click the save
icon.
Check new configuration for employee
Amend monthly pay day
Amend the monthly pay day to accurately reflect the actual pay day for each month In UAT. To do this, follow the steps in the relevant section below.
Portal
Click Settings then click UK Tax Rates.
Click General then click Average Pay / Pay Days.
From the Pay Group drop-down menu, select the relevant pay group.
Check that the monthly pay day is set to the actual pay day within the month, rather than the last day of the month.
Remember, the qualifying week starts on the Sunday of a given week and includes the following six days, ending on Saturday.
Click Save.
Back Office
Click CorePay then click Reference.
Click Maintain Statutory Pay Parameters then click Average Pay / Pay Days.
Click Maintain SSP/SMP Pay Days for Pay Group.
Check that the monthly pay day is set to the actual pay day within the month, rather than the last day of the month.
Remember, the qualifying week starts on the Sunday of a given week and includes the following six days, ending on Saturday.
Click the save
icon.
Example employee
Take a new example employee with a new instance of maternity leave. This amendment will not correct maternity records retrospectively.
Review AWE
Review the AWE on the Maintain SMP Details screen for the employee. The system should now refer to the correct months in the AWE calculation.