Maternity and parental benefits: entitlement and calculation

Besides its joys, parenthood also brings questions about financial security while caring for a child. Maternity benefit and parental allowance are two different payments, each with its own conditions of entitlement, calculation and payment. The employer plays an important role in keeping records, communicating with the insurance institutions and ensuring the employee’s return to work.

The difference between maternity benefit and parental allowance

“Maternity”, or more precisely maternity benefit, is a sickness insurance benefit paid by the Social Insurance Agency (Sociálna poisťovňa) during the period around childbirth and the care of a newborn. Parental allowance, on the other hand, is a state social support benefit paid by the Labour Office (ÚPSVaR) once the entitlement to maternity benefit has ended. These are therefore two different benefits from different institutions, with different conditions and different methods of calculation.

• maternity benefit – from sickness insurance, Social Insurance Agency,
• parental allowance – state support, Labour Office,
• the option for the other parent to draw it as well.

Conditions of entitlement to maternity benefit

Entitlement to maternity benefit arises when the condition of a sufficient period of sickness insurance within a set time before childbirth is met and the insurance relationship continues. The benefit may be drawn by the mother, but under certain conditions also by the father, for example when the parents take turns caring for the child. The Social Insurance Agency assesses the exact conditions individually according to the applicant’s insurance history.

How maternity benefit is calculated

The amount of maternity benefit is based on the daily assessment base, which is derived from previous income on which sickness insurance was paid. There are also maximum caps on the daily benefit. As both the percentages and the limits change, always check the specific amount or have a calculation made, because the result depends on the applicant’s individual situation and income history.

Parental allowance

When maternity benefit ends, the parent usually moves on to parental allowance, which is set at a fixed amount and is provided by the Labour Office. Its amount differs depending on whether or not the parent previously received maternity benefit. Here too, the amounts are updated every year, so they need to be checked against the rules in force.

The employer’s obligations

The employer keeps records of maternity and parental leave, communicates with the Social Insurance Agency, handles the interruption of insurance and, when the employee returns, ensures that they are placed back in their original or an equivalent position.

1. keep records of maternity and parental leave,
2. report the details to the Social Insurance Agency,
3. handle the interruption of insurance,
4. ensure the employee’s return.

Overlapping benefits and working during parental leave

Parents can take turns caring for the child, which affects who receives which benefit. While receiving parental allowance, a parent may also work under certain conditions, because this benefit is not tied to the parent having no income. The situation is different with maternity benefit, where stricter conditions apply to income from the same insurance relationship. Situations are therefore assessed individually, and it pays to discuss them in advance so that the parent does not lose the entitlement. For the employer, this means the need to record interruptions and returns correctly, as well as any part-time arrangements, which affect both the wage and the contributions. Timely and accurate communication with the Social Insurance Agency and with the Labour Office will simplify the whole process for the parent and help the company plan cover during the employee’s absence.

If you are dealing with maternity or parental leave for your employees, Bilvao’s payroll team will help you with correct record-keeping and with communicating with the authorities.

Related articles: Sick leave and income compensation: who pays for the first days, Annual health insurance reconciliation for employees, Employee benefits and their tax treatment.

Frequently asked questions

Can the father receive maternity benefit too?

Yes, if the statutory conditions are met, the father can also draw maternity benefit, for example when the mother moves on to parental allowance. The Social Insurance Agency assesses the entitlement according to the applicant’s insurance history.

What is the amount of maternity benefit calculated from?

From the daily assessment base derived from previous income on which sickness insurance was paid, subject to maximum caps. Check the specific amount, as both the percentages and the limits change.