Consumer Corner: Babies and benefits of maternity leave in Ireland

At €250 per week for the first 26 weeks, can women afford to take maternity leave?

For anyone planning maternity leave,HR expert, Louisa Meehan says they should find out about their state entitlements and do a really good budget plan

Having a baby can be an exciting time but it can also be quite a stressful and worrying time.

Women in Ireland are entitled to time off after they have their baby but many will experience a significant pay reduction. To manage this, some new mothers will not only have to look after their new baby but also will also be faced with the stress of managing their revised budget and finances.

We are lucky in Ireland that maternity leave is a right. Compared to other countries, such as the US, we allocate a significant amount of time for maternity leave.

However, many workers don’t fare well on pay while taking their leave. Ireland is one of the worst countries in Europe for offering financial support during and after pregnancy. Pay for maternity leave very much depends on the company you work for. Although women are entitled to the time off, anyone who works for a company that doesn’t pay maternity leave (there are many) will be entitled to €250 per week from the state.

So for example, a woman who was on a salary of €40,000 will see her monthly wage plummet from €2,673 to €1,000. That’s a drop of €1,673 a month or over €10,000 in six months. This is the real financial cost for a woman to have a baby in Ireland.

Figures from the global employment platform, Boundless, illustrate Ireland’s very low ranking in Europe on paid maternity leave.

Employers in Ireland are under no obligation to pay maternity leave, while in the UK, for example, women will get 90% of their weekly salary for the first six weeks.

This compares to Bulgaria where women will get 90% of their full salary for more than 58 weeks while on maternity leave. Norway is similar in that women will get between 80% to 100% of their salary for 49 weeks.

Women in Ireland are entitled to 26 weeks of maternity leave plus 16 weeks of unpaid leave. For the first 26 weeks, they will get the state benefit of €250 per week. Although expectant mothers have no right to be paid any additional top-up payment by their employer, women will be treated as being in employment while on maternity leave, so will be entitled to paid annual leave.

HR expert, Louisa Meehan of Woodview HRM (bespoke human resource consultancy within the SME sector), says, in Ireland, larger businesses, including some in the public sector, usually pay maternity leave. The amount, however, can vary. 

Meehan acknowledged smaller businesses may indeed pay some additional top-up payment but very few furnish an employee with full pay for the entire period of maternity leave.

“It is very expensive for [SME] employers as they have to pay the additional maternity leave and also pay to get the role covered,” she said.

For anyone planning maternity leave, Meehan says they should find out about their state entitlements and do a really good budget plan.

“You can talk to your mortgage provider [if you have one] about reducing your repayments. If you have very significant concerns, phone the Department of Social Protection and see if you can get any additional support for this period.”

Once you discuss options with your mortgage provider, it may seem prudent to opt for another payment plan, or to pause your repayments in the short term.

When preparing for a baby, it is cost-effective (and environmentally friendly!) to look at the second-hand market for baby equipment. Sometimes you can get better quality for less than you could afford if you bought new.