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New mothers excluded from wage subsidy: 'I feel like I'm being penalised because I was on maternity leave'

Finance Minister Paschal Donohoe said he is examining the issue of women being excluded from the Covid-19 wage subsidy.
May 22nd 2020, 12:16 AM 48,577 55

NEW MOTHERS AFFECTED BY the maternity leave exclusion from the Covid-19 wage subsidy have said that the anomaly has put financial pressure on them and left them feeling penalised for having a child. 

The government has been under pressure to rectify the anomaly since it was first revealed last month.

“Wasn’t there anybody at the table [making the decision] who would have thought, ‘Well what happens to the women who were on maternity leave?’”, one woman told TheJournal.ie. 

Another questioned whether the government will backdate the payments if the decision to exclude new mothers is reversed. 

The Covid-19 Temporary Wage Subsidy Scheme (TWSS) pays up to €410 per week to an employee of a business that has lost more than 25% of its turnover, on the condition that employers keep those workers on their books.

The aim of the scheme is to prevent workers from becoming unemployed. 

However, in order to be eligible for the scheme, an employee’s payslips from January and February are needed, to calculate what wages they were expected to get.

This means that new mothers who were on unpaid maternity leave for January and February currently aren’t eligible for the scheme; Revenue has instructed businesses to pay these employees directly.

For women on paid maternity leave, there has been some suggestion that only the ‘top-up’ from their employer will be assessed as the pay they would have been earning, making them eligible for only a fraction of their normal wage from TWSS. 

In some cases, businesses have been advised to make women temporarily unemployed so that they can avail of the Pandemic Unemployment Payment (also called ‘Pup’) of €350 per week. 

Men who were on paternity leave, or people who were on illness benefit or off-pay leave, are also affected by this way of calculating an employee’s wages.

The Department of Finance had initially argued that the wage scheme cannot be changed to suit each individual; but this week, Finance Minister Paschal Donohoe said that the maternity leave exclusion issue is being examined by Revenue and his Department.

Justice and Equality Minister Charlie Flanagan said that Cabinet were to discuss the maternity leave issue when it meets today.

‘Should I have taken maternity leave?’ 

You’d wonder did it ever come up. I don’t know which is worse, that it didn’t come up in conversation, or it did, and it was just ‘no it’s fine’.

Edel Carlos from Co Roscommon was due back from maternity leave this Monday, 18 May. Her first child, a little girl called Molly, was born on 10 December.

image000000 Source: Edel Carlos

But when she checked in with her employer, they told her that she wouldn’t be eligible for the temporary wage scheme due to the government’s strict criteria. 

“You’re told you’ve been temporarily laid off, and that you’re the only one who has been temporarily laid off – you feel ostracised and forgotten about,” she said, adding that it was already a vulnerable time without family or friends around for support.

At the beginning, she said the “drive was in me” to chase up the issue with Ministers, Revenue, and public representatives.

But now, she says, “I’ve kind of lost hope, I don’t have faith. I just don’t see it being changed.”

It was the money at the start, I thought, ‘oh my god I’m not going to get anything’. But I’ve kind of gone past the money now, to feeling like I’ve been outcast. 

She says that although it may sound extreme, “you do think, was I wrong to go [on maternity leave] and have a child?”

Another woman who wishes to remain anonymous said that she had returned from maternity leave in March, but was told she wouldn’t be entitled to the TWSS as she had no payslip from January and February.

“I feel like I’m being penalised because I was on maternity leave,” she said.

Don’t get me wrong, this is new to everybody. [But] it could have been amended – it’s eight weeks down the road and they’re only looking at it now.

She says the government could have assessed women’s wages based on what they were expecting to earn when they returned to work, or what they were earning before they went on maternity leave.

Employees who had been in the job for a few months were entitled to the TWSS, while she had to apply for the pandemic unemployment payment, despite being employed at one company for 10 years.

“It’s putting a little bit of pressure on us. I’m looking to return to work in June, even though I know it’s potentially not safe. We’ll have to do it because we couldn’t sustain this long term.”

She says she isn’t hopeful that the government will resolve the exclusion issue – but if they did, she asks whether they will backdate the payments from the previous two months.

Employers 

Mick Kenny of the Urlignford Community Childcare Centre is an employer whose organisation is funded entirely through the Department of Children and Youth Affairs.

He said that when faced with this issue, he made the decision to pay an employee who wasn’t eligible for the TWSS, despite the association’s funding being cut by the Department of Children.

He said that Revenue’s advice to pay employees their full wages without the subsidy scheme isn’t practical for a lot of businesses, while the other option of making them temporarily unemployed could have legal consequences.

“It’s a minefield out there,” he said, adding that this approach was “offloading responsibility” onto employers, who are already under strain.

Realistically, that’s bad advice from the government,. They can’t apply for the PUP payment, because that breaks employment legislation. And the thing is, you could easily have an employer honestly going ‘I don’t have the money’, and saying that to staff in very good faith, because they may not have the money to pay them.
But at the same time, they are putting themselves in legal jeopardy. Because you’re blocking that woman returning to the workplace.

“I can see there were very rushed decisions being made when the pandemic hit. This was an oversight, but at the same time, there are ways around it.”

What does the Department have to say about it?

Speaking to reporters this week, Finance Minister Paschal Donohoe said: “I do have to be mindful that there are many other groups of citizens at the moment who are looking to enter the wage subsidy scheme, and for different reasons that has not been possible.”

In a letter to the National Women’s Council of Ireland, Donohoe’s Department said that the TWSS has developed “quickly”, and said that “it must be accepted that the TWSS simply cannot be adapted to meet the particular circumstances of individual employers or employees”.

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Revenue had said that in cases where women are ineligible for the TWSS as they were on maternity leave during the assessment period of January and February, their employer can either “operate the scheme based on Average Revenue Net Weekly Pay for January/February 2020, or pay the employee the appropriate wages without receiving a subsidy refund.”

In a statement to TheJournal.ie, the Department of Finance said “it is necessary to prevent abuse” that an employee must be on the payroll as of 29 February 2020 to avail of the scheme. 

“The 29 Feb payroll decision has consequences for many groups, however, the scheme   is being administered in a manner that is fully compliant with all relevant legislation and that no discriminatory treatment of workers arises.”

It also said that the TWSS doesn’t change any legal obligations on employers to their employees: “The entire period of pregnancy and maternity leave is a special protected period under the law.” 

“It is understood that although the employer may not be able to claim the TWSS for a person who has not been on the payroll on 29 February but is entitled to return to work after this date, they remain obliged to honour their obligations as an employer as the full suite of employment rights legislation continues to apply in relation to all employees and their employers for the duration of the Covid-19 crisis and beyond.”

The issue has been referred to the Irish Human Rights and Equality Commission by the NWCI, which said it was “a matter of concern”, and the IHREC would be examining the issue “in detail”. 

The National Women’s Council of Ireland have asked people to contact their local TD to urge the government to change the maternity leave exclusion from the TWSS.

- With reporting from Michelle Hennessy.

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