How to write an enhanced maternity and adoption pay policy

Before you start

Legal basis. Statutory maternity, adoption and neonatal leave and pay; the maternity equality rule for occupational pensions (Equality Act 2010, s.75); and the rules on deductions from wages (Employment Rights Act 1996, s.13). GOV.UK says your maternity policies must be clear and available to staff [4]. The law here applies in Great Britain.

Who to involve. Reward, HR, payroll, finance, your pension provider or trustees, and a legal adviser. Consult employee representatives if you have them.

What you need. Your current policy and contracts, recent maternity and adoption case numbers, salary data for costing, and your pension scheme type.

For the evidence on what other employers do, see our research briefing on enhanced maternity and adoption pay.

Step 1: Set out the statutory floor

Start with what everyone gets by law.

• Leave. 52 weeks' maternity or adoption leave, with no minimum service [2][6].
• Pay. SMP and statutory adoption pay (SAP) need 26 weeks' service by the 15th week before the due date (maternity) or the matching week (adoption), and average earnings of at least £129 a week [2][3][6].
• Neonatal care. A day-one right to up to 12 weeks' leave for babies born on or after 6 April 2025 who enter neonatal care within 28 days of birth and then spend 7 or more continuous days there. Both conditions must be met. Statutory pay needs 26 weeks' service and the same earnings test [7].

Step 2: Decide who qualifies for enhanced pay

Step 3: Set the level and duration

Worked example. Salary £35,000 a year (illustrative only, not a benchmark). Average weekly earnings £673.08. SMP is £605.77 a week for weeks 1 to 6 and £194.32 for weeks 7 to 39. Enhanced pay includes SMP. Assumes the employee qualifies for SMP and the employer reclaims 92%. Computed in Python; National Insurance and pensions excluded.

At earnings below about £215.91 a week (£11,227 a year), 90% of earnings is below the flat rate, so SMP stays at 90% for all 39 weeks.

In the lumi reward benchmark, enhanced pay above statutory is the common answer, at 43.8% of organisations. 26.6% pay statutory pay only, 25.4% combine enhanced leave and pay, and 4.3% enhance leave only, with statutory pay (n = 256).

The median number of weeks of enhanced maternity and adoption pay is 12. The 25th percentile is 0 weeks, the 75th percentile is 16 weeks and the range runs from 0 to 52 weeks (n = 261).

Step 4: Write how enhanced pay and statutory pay fit together

By law, contractual pay for a week in the pay period counts towards the SMP or SAP due for that week, and the reverse [16]. So write that enhanced pay includes statutory pay. In week 7 of a full-pay scheme in the example, £673.08 is made up of £194.32 SMP and a £478.76 top-up.

You can usually reclaim 92% of the statutory element, or 109% with Small Employers' Relief. The top-up can't be reclaimed [5]. Define "normal pay", and apply pay rises awarded during leave, as employees are entitled to them [8].

Step 5: Decide whether enhanced pay is repayable

Acas says an employee may have to repay the enhanced amount if she doesn't return or leaves soon after, if her contract sets this out clearly. "They never have to repay statutory maternity pay." [9] Recovering money from final pay needs a contractual term or the employee's prior written agreement [11].

Step 6: Set the rules for keeping-in-touch days

Employees can work up to 10 KIT days during maternity or adoption leave, and 20 during shared parental leave [8]. Pay should be agreed in advance and can't be below the minimum wage [9].

Step 7: Decide pension contributions during leave

The legal minimum. In an occupational scheme, time on paid maternity leave, including weeks on SMP only, must be treated as if the employee were working normally. Her own contributions can be based on the pay she actually receives. Benefits need not build up during unpaid additional maternity leave [10]. The Social Security Act 1989 sets an equivalent rule for paid adoption leave [10]. For contract-based schemes, such as a group personal pension, confirm the position with your provider and adviser. GOV.UK notes contributions usually stop in unpaid periods unless the contract says otherwise [8].

Step 8: Apply the policy to adoption, surrogacy and neonatal care

Intended parents in a surrogacy arrangement can get adoption leave and pay if they meet the conditions, including applying for a parental order [6]. Neonatal care leave is taken after any maternity or adoption leave [7].

In the lumi reward benchmark, 70.4% of organisations have not addressed whether surrogacy is treated with parity to adoption in pay and leave policies, the common answer. 18.4% have partial parity and 11.2% full parity (n = 267). On neonatal care, 67.0% provide the statutory entitlement only, 24.0% enhanced pay and 9.0% enhanced pay and leave (n = 267).

Step 9: Plan the return

Employees returning after up to 26 weeks have the right to their old job; after longer, to the same or a similar job [8]. They can request flexible working from day one [15]. Since April 2024, a pregnant employee has priority for suitable alternative vacancies in a redundancy until 18 months after the birth [9].

In the lumi reward benchmark, 64.4% of organisations provide neither coaching nor a phased return beyond statutory after extended family leave, the common answer. 20.5% offer a phased return only and 15.2% coaching plus a phased return (n = 264).

Step 10: Publish and review

Publish the policy where all staff can find it and brief managers and payroll. Review it each April, and when the 2027 regulations are published.

Checklist

• Policy restates statutory leave and pay for 2026/27
• Service requirement for enhanced pay is stated, with a rule for Maternity Allowance cases
• Level and duration are costed
• Policy says enhanced pay includes statutory pay
• "Normal pay" is defined, and pay rises during leave are applied
• Any repayment clause is in the contract, with exceptions
• KIT day pay is set at or above the minimum wage
• Pension treatment in paid and unpaid weeks is confirmed with the provider
• Adoption, surrogacy and neonatal care are covered
• Return-to-work support and redundancy priority are covered
• Payroll reclaims 92% (or 109%) of statutory pay only

Related

• Maternity, adoption and neonatal pay: UK benchmark 2026 — the benchmark findings behind the figures in this guide.
• How to update your paternity and parental leave policy for the 2026 changes
• How to write a carer's leave and compassionate leave policy
• How lumi works: methodology — how these figures are collected and calculated.