With maternity leave affecting hundreds of thousands of employees each year, businesses are recognising that an enhanced maternity pay package isn’t just a perk, it’s a strategic investment in retaining and attracting top talent. With women making up more than half of the UK workforce, maternity benefits have become a critical part of an organisation’s appeal, and a heavy consideration for women looking for roles.
The recent Bright mine Maternity Pay 2024 report sheds light on how enhanced maternity packages can give organisations the edge with top talent while promoting workplace equity and inclusion. But what exactly does a “competitive” maternity pay package look like? And how can businesses use these benefits to strengthen their talent strategies?
Why Enhanced Maternity Pay Matters
When it comes to maternity leave, most employees are entitled to statutory maternity pay. However, forward-thinking organisations are going the extra mile by offering enhanced maternity packages, which top up the statutory provision. The benefits of this go far beyond the financial. Offering a competitive maternity pay package not only helps employees feel valued and supported during an important life event but also has tangible benefits for the organisation itself.
Here’s why it matters:
Attracting Top Talent: Competitive maternity benefits are a significant draw for skilled professionals. Candidates are increasingly looking for employers who offer family-friendly policies and flexibility. A robust maternity package signals that your organisation values its people and is committed to supporting them through every stage of their career.
Retention and Loyalty: Enhancing maternity pay fosters employee loyalty. Knowing they are financially supported during maternity leave encourages employees to return to work, reducing turnover and ensuring continuity. In fact, 74.1% of organisations offer maternity pay that exceeds the statutory minimum, according to the Brightmine report, helping to secure long-term commitment from staff.
Building an Inclusive Culture: Offering enhanced maternity pay is a strong statement about an organisation’s commitment to equity and inclusion. By supporting new parents, employers contribute to closing the gender pay gap and foster a culture where employees feel respected and valued.
What Does a Competitive Maternity Pay Package Look Like?
One of the most important insights from the report is that enhanced maternity pay can vary significantly between organisations. The period of enhanced pay can range from as little as one week to as many as 39 weeks. The five most common enhanced pay periods are: 26 weeks, 18 weeks, 12 weeks, 24 weeks, and 16 weeks.
Similarly, the report highlights that most organisations (84.5%) require a minimum length of service before employees qualify for enhanced maternity pay, with only 15.5% offering it from day one. This demonstrates the importance of structuring maternity packages in a way that balances financial considerations with a desire to support employees.
Return-to-Work: A Key Factor
Another factor shaping enhanced maternity pay is whether it’s tied to a return-to-work commitment. According to the report, 46.6% of employers require the employee to return to work for a specified period to benefit from enhanced maternity pay, while 53.4% offer it unconditionally. Offering flexibility in this area can help retain employees by easing the transition back to work after maternity leave.
The Business Benefits of Supporting Parents
Beyond the obvious employee satisfaction, organisations that offer enhanced maternity pay stand to gain in several ways:
Reputation as an Employer of Choice: Companies that go beyond statutory requirements for maternity pay strengthen their reputation as employers who genuinely care for their staff. This enhances employer brand and makes the business more attractive to prospective employees.
Increased Employee Engagement: Supporting employees during critical life stages leads to higher engagement and productivity. When employees feel valued, they’re more likely to stay loyal to the company and perform at their best.
Closing the Gender Pay Gap: Interestingly, just 1.1% of organisations offer equal parental leave, but those that do report narrowing their gender pay gap as a result. By supporting both parents equally, organisations create a more equitable workplace and reduce career interruptions for women.
How to Develop a Maternity Package That Works for You
While there’s no one-size-fits-all approach, the Brightmine report offers some valuable guidance. The top two drivers for enhancing maternity pay were promoting inclusion and equity in the workplace (55.7%) and doing the right thing by employees (69.6%). This highlights a growing recognition that people policies should reflect the values and culture of the organisation, not just financial considerations.
Businesses should assess their current maternity pay policies against industry benchmarks and consider how their benefits align with their overall talent strategy. A well-thought-out maternity package, offering flexibility and support, will not only attract top talent but also help you retain skilled employees for the long term. In line with this, offering enhanced paternity leave, which is a 2-week allowance in the UK, one of the lowest in Europe, will be an attractive offer for both fathers and mothers.
Our Head of HR Services Catherine comments on the importance of a flexible maternity policy "Enhanced maternity pay isn’t just about ticking the right boxes—it’s about showing a true commitment to your employees' wellbeing during one of the most vulnerable times in their lives. By offering competitive benefits, your organisation can strengthen its position as an employer of choice, boost its reputation, and support both the recruitment and retention of top talent. By investing in your people, you’re investing in the future success of your organisation."
Our HR Consultancy Service connects you with a team of expert HR Associate Consultants, ready to guide you through complex projects, including the development of competitive compensation and benefits policies. For a confidential discussion on how we can enhance your team’s resources, reach out toCatherinetoday.