Forced to pay back contractual maternity pay

While I was off on maternity leave and after the birth of my child I called and spoke to my work and made it clear that I was not coping with my two kids and I needed to move to a different location to be closer to my family. During my time off I made every effort to find different opportunities within the company and every turn I was hit with a blocker. I came back to work but was not coping and after three months handed in my notice. I have been told now that I need to repay the contractual maternity pay as per the policy which states if you return and leave within six months you need to pay back 100% and if you leave within a year you need to pay back 50%. It does state you will not need to pay it back if you are made redundant or for ill health. I did stipulate to them that it was for my mental health and wellbeing that I needed to move. They are saying that my mental health doesn’t constitute the right type of health and that I need to pay back the CMP and that they are not obliged to find anything just give me my role or a similar role back. I have shown them all the time I spent on maternity leave trying to network to find a new role. How will they make me pay this back? It seems rather unfair that the first day I hear about this is the day before I finish up.

working mum sits at desk, stressed


Such repayment clauses are fairly common and generally regarded as reasonable and enforceable because both parties receive a benefit under them: the employee receives an enhanced payment they would not otherwise be entitled to, and the employer has the security of knowing the individual will return to work after their leave period. Organisations who pay enhanced maternity pay (or indeed, other types of family-related pay) do so in order to motivate and retain staff members. Typically, the enhancement, particularly if it is very generous, does require staff to return for a specific period of time after their maternity leave ends.

Requiring repayment of such sums is only lawful where there is a contractual or legal right to do so. This can be often achieved, for example, by wording in your employment contract, or if the maternity policy/repayment section forms part of your contractual terms, or if you were issued a letter before maternity leave setting out your enhanced maternity pay and confirming the repayment duty, which you then accepted either explicitly or by accepting the payments. The clauses typically also contain exceptions whereby repayment is not required, for example, if the employment is terminated by the employer because of redundancy or because the individual is incapacitated and unable to perform their work. The exceptions tend to be very limited and do not ordinarily apply if the individual has chosen to resign.

If the employer is lawfully entitled to make the deduction and an exception does not apply to the situation, the employer can take the sum from your final salary payment. If there is insufficient money in your final salary payment, the employer may agree a repayment plan with you. If you do not repay the money, the employer can start legal proceedings against you for breach of contract and to recover the money. In your case, it appears that you were aware repayment was required if you left the business within the relevant timeframe. The key point, however, is that you believe that the ‘ill health’ exception may apply and if so, it would mean that your employer would have no basis lawfully to recover the enhanced maternity payment from you.

To resolve this, you need to re-read the policy and wording to check exactly what it says regarding the definition of ‘ill health’ and ask your employer, if they accept that mental health is a form of ill health, why they are still seeking to recover the CMP payment from you. If the policy or your contract states that repayment is due unless the employment is terminated by the employer (rather than the individual) for ill health, then you are contractually obligated to repay the money.

If the policy is silent about which party can terminate for ill health grounds or is quite vague, you should explore this further with your employer and ask them to clarify why they have interpreted this as meaning termination must be by the employer to trigger the exception. You should also check the wording of any other documents you were given which deal with the enhanced payment as these should provide clarification if that is needed.

*Maria Hoeritzauer is a Partner at Crossland Employment Solicitors in Abingdon.

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