Do we have to continue to pay essential car user allowance to a woman on maternity leave and, if so, for how long?
The Employment Rights Act provides that a woman on ordinary maternity leave is entitled to her terms and conditions, apart from remuneration, as if she was at work. HM Revenue & Customs guidance is that a car allowance is remuneration and therefore an employer does not have to continue to pay the car allowance during the entire maternity leave period. However the car allowances provided under the NJC for Local Government Services Staff (the Green Book) are calculated on an annual assessment of what it costs the individual to provide their car for business use. This payment is intended to be a reimbursement of expense and is not simply cash that is a ‘transferrable benefit’ (i.e. insurance, road tax etc). In these circumstances the allowance is a payment towards the costs of maintaining a car and these costs will continue during maternity leave. Withdrawing the payment during maternity leave could therefore put a female employee at a disadvantage because of her maternity leave (which th
