Private-sector employers are obliged to pay a contribution for each employee to the maternity fund. Rates can be found here.
Note: If the employee’s age is equal to or above the age of 65 years then they are entitled not to pay MLF.
How is MLF calculated?
Maternity Leave Fund is calculated as follows:
Annual Gross / 52 = Weekly wage
Based on weekly wage, check the Category that the employee falls under.
Rate of Category * number of Mondays worked
Max Borg, born on the 1st of February 1980
Annual salary: €18,000 / 52
Weekly wage = €346.15
An employee with a weekly wage between €182.84 and €499.73 (born after 1962) falls under Category C2:
Therefore, MLF = 0.3% of weekly = €346.15 x 0.3% x 4 Mondays = 4.1538, rounded to 2 d.p., therefore, MLF is €4.15.
The below cases exempt employers from paying MLF:
- In the case where employees work in the general government sector, authorities, agencies and public corporations;
- In the case of employees who are on unpaid leave and are not paying NI;
- In the case of directors who are on the FSS system but pay Class 2 Social Security Contributions (i.e. the self-employed rates);
- In the case where employees are exempted from paying NI due to any of the following scenarios:
- They are over the age of 65;
- Certain low income irregular workers; and
- expatriate employees who pay NI in another country.
If you want information on how SSC is calculated, click here.