Maternity benefit

What it means

Maternity benefit is a sickness benefit from the Social Insurance Agency during maternity leave. The Agency pays it, not the employer, and it replaces employment income.

Entitlement depends on the length of sickness insurance before the leave starts. A father can take the leave too if the parents agree and he meets the insurance conditions.

Maternity benefit and maternity leave are not the same thing. The leave is time off under the Labour Code that the employer grants, while the benefit is a cash payment from sickness insurance. A self-employed woman who pays sickness insurance can therefore be entitled to the benefit, even though she has no maternity leave in the strict sense because she is not an employee.

How it works in practice

The employer does not deregister the employee: the employment continues and the absence is simply recorded. Payroll is set to a period with no income and no contributions.

Parental leave and the parental allowance from the labour office usually follow. The company plans on the job being held open for the person to return to.

Maternity leave counts as time worked for annual leave purposes, so the employee brings her entitlement to annual leave for that period with her. We keep track of it in the payroll records throughout and, before she returns, agree with the client whether she will take it straight after maternity leave or later in the year.

What to watch out for

If the employee takes on an agreement or part-time work during maternity leave, the benefit can be lost. Do the arithmetic before agreeing anything of the sort.

During pregnancy and maternity leave the employee is in a protected period, and the employer cannot give her notice except in the cases the law allows. Notice given during this time is invalid, and the company may end up paying compensatory wages for the whole length of the dispute. Organisational changes are therefore planned with people on maternity leave in mind.