Ordinary Statutory Paternity Pay (Birth)

Your employee may be entitled to Ordinary Statutory Paternity Pay if their spouse or partner gives birth to a child. This replaces their normal earnings and helps them take time off to care for the child.

As their employer, whether you have to pay them OSPP depends on how long they have worked for you, how much they earn and the date of the baby's birth. They will also have to provide you with documentary evidence at least 28 days before they wish their OSPP payments to start.

Payments of OSPP count as earnings. You must deduct tax and National Insurance Contributions (NICs) from them in the usual way.

You'll normally be able to recover some or all of the OSPP you pay.

ENTITLEMENTS

OSPP following the birth of a child is available to an employee who is:

• a biological father
• a mother's husband, civil partner or partner (this includes a mother's female partner in a same sex relationship)

and who is taking time off to support the mother or care for the baby.

To qualify for OSPP, the employee must have:

• worked for you continuously - full or part-time - for at least 26 weeks up to and including the Qualifying Week (the 15th week before the week the baby is due) and must continue to work for you up until the date the baby is born.
• average earnings at least equal to the lower earnings limit for NICs, £111.00 a week for 2014/15, in the relevant period up to the Qualifying Week.
• given you the right documentary evidence and at least 28 days notice of when they would like their OSPP payments to start.

Average Weekly Earnings

The calculation of the average weekly earnings is very important because it not only determines if the employee qualifies for OSPP but also how much they qualify for. To qualify for OSPP, an employee must have average weekly earnings of at least the NIC LEL amount, £111.00 for 2014/15, in the relevant period up to the Qualifying Week. 

From 6th April 2014, OSPP is paid for one or two consecutive whole weeks at the lower of £138.18 per week or 90% of the employee's average weekly earnings.



Recovery of OSPP

All employers are entitled to recover 92% of OSPP they pay, however if the employer qualifies for Small Employers Relief, where the total NIC in the qualifying tax year was under £45,000, they can recover 100% of OSPP paid plus an additional 3% in compensation for the employer’s share of NIC due on these payments.

CALCULATING OSPP ON BRIGHTPAY

To access this utility, simply click  'Payroll' and select the employee’s name on the left:

1. Under Statutory Pay, click Calendar
2. On the Calendar, select the start date the employee wishes to start their Ordinary Patermity Leave
3. Select Ordinary Paternity Leave from the Parenting Leave section at the top right of the screen
4. Enter all relevant dates and select the employee's Length of Leave from the drop down menu
5. Average Weekly Earnings (AWE) - the program will automatically calculate the employee’s average weekly earnings for the purpose of calculating OSPP due
   The user can at their own discretion override the automatic calculation and manually enter an employee’s average weekly earnings. However it is recommended to seek advice from an accountant before doing so. To override the automatic calculation, simply untick the box and enter the amount.
6. Click Save when completed. The program will automatically update the calendar accordingly and apply the OSPP due.

Overriding the 'Average Weekly Earnings' Calculation

If existing payment records have not been recorded in BrightPay, the automatic calculation performed by the program after completing the above may be inaccurate. In the event of this occurring, the user may override the AWE by doing the following:

1. On the main Payroll screen, click the Edit icon in the employee’s Statutory Payments section
2. In Ordinary Paternity Leave, select the option ‘Override average weekly earnings’
3. Enter the average weekly earnings amount for the employee, then click out of this box
4. The program will now calculate OSPP based on the AWE manually entered by the user

Editing the Length of the Ordinary Statutory Paternity Leave

Should an employee wish to extend or reduce the length of their ordinary paternity leave, the length of leave already entered for the employee can be edited as follows:

1. In Payroll, select the employee’s name on the left
2. Under Statutory Pay, click on Calendar
3. On the Calendar, select any date in advance of the current payroll date and which is currently marked as Ordinary Paternity Leave
4. Within the Ordinary Paternity Leave section that will appear to the right of the calendar, click the Edit icon
5. Amend the employee’s Length of Leave by selecting the number of weeks now applicable from the drop down menu
6. Click Save
7. Close the Calendar to return to the main Payroll screen

Further information regarding the operation and calculation of Ordinary Statutory Paternity Pay can be found on the HMRC website or by consulting the HMRC Guide E19 Employer Helpbook for Ordinary and Additional Statutory Paternity Pay.