An employee is receiving statutory maternity pay and has participated in the nusery voucher salary sacrifice scheme. The client has deducted the vouchers from the statutory maternity pay contrary to HMRC guidelines. If the vouchers are not deducted from statutory maternity pay the employee will be receiving vouchers which are not being deducted from her remuneration. There may be employment law issues with ceasing to provide the vouchers, although they were not a benefit in kind but an alternative to salary.
We believe the client must re calculate the payroll for the previous months to ensure correct PAYE and NI. However, should the payroll be grossed up and the vouchers then deducted for completeness?
Can the client cease paying the vouchers as the employee has no salary to sacrifice?