Maternity pay entitlement from employer

Hi,
I am hoping someone can help me with this query. I have worked in the same Company for the past 16 years. For the first 10 years of my service the company policy was to pay full pay while employees were on maternity leave. During my 10th year of service the company reduced this entitlement to 40% of salary (less social welfare). The new policy was only to affect any new employees and all existing employees were assured that the new reduced benefit would not affect them. Indeed 2 of my colleagues had babies 3 and 4 years ago and received their full salary for the duration of their maternity leave.
The company was taken over by new owners 2 years ago and the new owners assumed that the new policy was what applied to all employees. During their due diligence they were not told of the few employees who had been entitled to their full pay (old policy). We were given every assurance that all benefits would be preserved subsequent to this take over and this was given to us in writing.
I am now pregnant and due in February, I assumed that I would receive my full pay given my length of service and assumed that the old agreement would be honoured. I am being told by my boss that the new owners won’t honour the new policy. Not only am I repulsed that I am being treated like someone who just walked in the door but I think the company is being very underhand. Leaving the emotion aside, while I understand that employers are not legally bound to make any contribution towards maternity leave, what are the legalities around this. Does an employer have to give any notice of a change in benefits? If I tried to take a case against my employer he will openly admit that the benefit that applied to me was full pay and will not deny that there was a verbal agreement in place which he says he cannot now honour.
Advice please, thanks.

All terms and conditions of employment have to be honoured (with the exception of pension) on the Transfer of Undertakings from on company to another. This is called TUPE. It is not good enough for the company to feign ignorance on this issue, as they should be aware. If you have no luck with your direct approach to management on the matter, bring this to the attention of your union should there be one in place. Alternatively bring this to a solicitor; however depending on your relationship with management, to threaten to do this may resolve the issue.

While you have it in writing that all benefits will be preserved, which is proper order under TUPE, do you have it in writing about the retention of the benefit for long standing staff members per the old Maternity Policy? Even if you don't, there is custom and practice that can be referred to (your two colleagues).

I'm confused
Are the new bosses ignoring both the old policy -full pay, plus the new policy of 40% pay ?
It would not seem "underhand" for them to ignore the old policy if they were genuinely not made aware of it.
But it would seem underhand to ignore the "new" policy that they did know about.

However, if you have something in writing from the previous owners that states your full-pay maternity entitlement then,legally, it would seem that the previous poster is quite right -you get what was originally agreed.

It's a bad luck and a little unfair on the new owners if this (old) policy was not disclosed to them. But that's the law.

hi,
just to clarify. the new bosses accept the new policy i.e. 40% pay; they took this as the benefit for all employees and were not correctly advised that there were a few people who were promised the old deal some years ago.
the new bosses will not pay the old benefit and insist that the original shareholders would have to fund this mess.
this puts me in a difficult situation as these shareholders are my colleagues that I have worked with for the last 16 years.
My boss (who was my boss under the old regime), will admit thet the new owners should have been told about this old agreement. he does not deny that had we not been taken over last year I would recieve full maternit pay

Basically your last post says :-

The original owners - your colleagues of the last 16 years - either lied or "forgot " to tell the new owners the original policy. They even "admit that the new owners should have been told about this old agreement".

So, your statement in the OP, that you are "repulsed" and that "the company are being very underhand" is difficult to understand. By "the company" do you mean the new bosses who seem to have acted in good faith? Surely not.

Based only what you have said it seems that your colleagues,the old bosses, have a moral responsibility to fork out the extra maternity pay from their own resources. Their attitude seems to be "yeah,well, we took their money without telling them the whole truth and now the suckers have to pay out for your maternity leave -tough on them and maybe tough on you having to fight for it ". Nice people !

Some years ago I was a director in a large travel company that purchased several smaller travel agencies, the owners of which were retained as managers of those shops.
The purchase agreements contained provisions that basically said if there are any falsehoods, omissions etc etc then the old owners had to pay up.
Obviously,it was more complicated than that but a failure to disclose salient facts would, i thought, have made your old bosses liable.

However, not knowing what type of contract your new bosses had with your less-than-open old bosses it's difficult to say whether the new bosses could succesfully sue for the extra maternity benefit, to which legally I still think you are entitled.

The new company are claiming that the only policy they were told about is the 40% one, I think they are justifibly saying that they will only pay this (less SW) cause this is what they were told about.
I do feel that my Boss (who also worked in the old company) is being underhand.
he is basically saying to me that because the new owners won't pay full maternity benefit I won't get it; even though if we were still under old ownership I would get it.
Basically he is assuming that he can make me absorb the cost of this screw up.
If the new owners had been told during their due dilignece that there was an old maternity policy in existence they would probably have been fine about it.

your boss is a ***** . You have been illtreated. I know it puts you under pressure to take this further especially when expecting, and you and the baby's health takes precedence.

-sorry.got cut off...

..anyway, I 'd advise that after having a friendly and frank chat with the new booses and if you get nowhere then you put everything in writing and state that you are only taking 40% at the moment but that you will pursue the matter when you are fully fit and able. Obviously you'll say that you don't personally blame the new owners.


It's sad to go down the legal route but maybe also a quick visit to your lawyer.

But dont get involved with labour courts or anything like that until well after your maternity leave.

I feel annoyed for your sake !! Good luck....

If you are entitled to full maternity pay (and it sounds like you have a strong case for that), then the claim is against the company itself, regardless of who the shareholders or bosses are. If the new shareholders then want to take a case against the old shareholders for a breach of warranty against the old selling shareholders, that's between themselves and is their choice. You should not be stuck in the middle.

I'd write a proper letter to HR outlining that you were always working on the assumption that full maternity pay would be paid and that you were never notified of any change in that policy and that, in fact, it was confirmed in writing that no benefits would be changed. Don't bother/worry about talking to old bosses and new bosses as that just brings you into the center of any issues that may arise between them.

As another poster has mentioned, this is not the fault of the new shareholders - they were not given accurate information. It's best to keep emotion out of it.

HI,
thanks for all your replies. I am told by my boss that TUPE does not apply as it was a change in shareholdings and not a merger/acquisition. The 'new owners' bought the shares of all the old shareholders. now that they own all the shareholding they effectively own the company.
I don't see a way around this;

TUPE may not apply but that means that the company remained the same legal entity, just with different shareholders (TUPE applies when employees are moved to a different company as part of an acquisition). That doesn't change the fact that the company retains its legal obligations. For example, I'm sure they couldn't say to the landlord "oh, we've changed shareholders, we're going to renege on the lease that the company entered into". Unless it was specifically the old shareholders that told you you would be paid maternity pay (and I highly doubt that it was), then it was the company, as a separate legal entity (the entity with which you have your contract of employment) - a change of shareholder does not affect those obligations.

Your last reply implies to me that they are playing silly buggers here. TUPE is a red herring.

hi,
thanks for the response. I feel like I am stuck and there is very little I can do. I would never work somewhere purely because of the Maternity benefit but I feel that 16 years of service does display loyalty. I stuck with this company when others went off to better paid jobs. My boss says that they don't have to contribute a single penny towards my maternity leave and he can revoke the 50% at any time. One of the people who got full pay has only been with the company for 6 years.
I don't feel like I have any option - yes the company should honour an agreement and now say they can't and I have to suffer the full consequences. makes me realise that loyalty counts for nothing nowadays;

If you remain working for the old company, irrespective of TUPE, you wwere given assurances that your benefits were preserved. Time to talk to a solicitor. Your boss is an idiot and the company must commit to the policy which they made assurances on.

It sounds like you don't want to take a case regardless of your rights/entitlements, and that's up to you (although I wonder why you posted in that case).

Comparing what other people got (e.g. when they were "only" in the company 6 years) is not helpful.

If you present your argument to your employer based on loyalty, fair dealing and length of service, then your employer will argue against those on the same basis. It appears to me that you want them to see the moral error of their ways and change their minds based on your long service and loyalty. That will not happen.

If you want maternity pay, then you need to present legal arguments. If you don't want to do that, that's entirely up to you.

If you don't want to go down the legal route, then you need to find a way to get over your disappointment, take the 50% pay for maternity leave and get on with things. The worst thing you could do would be to come back after the leave and resent every moment you are there because you are not working for "nice" people, even though those people (the new shareholders/management) are morally blameless because they were not informed of the policy before they took over the company.

Don't get me wrong I would take a case if I thought I had a strong one. it just seems to me that when it comes to Maternity pay that employers are not obliged to give you a penny above SW. My company is not doing well at the moment and the new shareholders will argue that they cannot afford to pay and were not informed in the first place.
Given that TUPE is not valid in my case I don't see what argument I have except the old shareholders having some moral duty/obligation which they don't see to have.
A friend of a friend is an employment solicitor and said that economic conditions are being used as a defense alot at the moment for cutting maternity and normal pay.

If your comany is not cutting normal pay, they should not be cutting Maternity pay. You have previous assurances. Threaten legal action and see whare thet gets you.

I think you misunderstood my second post - TUPE has nothing do with it because the company (the legal entity) has not changed. You do not need TUPE to enforce your rights. Again, that's a red herring and put it out of your mind.

A change in shareholders does not affect a company's existing legal obligations. The legal entity has not changed and that legal entity provided you with a policy that said you would get 100% maternity pay. If they wanted to change that (which they can, but didn't), they could only have done it before you told them you were pregnant.

The shareholders have no obligation and are irrelevant to this - it's not about the "people" that promised you something, it's about the fact that the company promised you something and now can't renege on it, regardless of the shareholder make-up of the company or if those shareholders changed in the meantime.

Imagine if there was no acquisition - then is it clearer that you would be entitled to 100% maternity pay? A company can't change a long-standing policy without informing its staff, even though they can change it with reasonable future notice (and my belief is that it is not reasonable to change e.g. maternity policy after someone has told them they are pregnant).