Understanding Statutory Rights as an Umbrella Employee
When you work through an umbrella company, you’re classed as an employee rather than a contractor or self-employed worker. That means you’re entitled to many of the same employment rights as permanent staff, including access to statutory maternity pay (SMP), paternity pay (SPP) and sick pay (SSP).
However, while umbrella employees are covered by PAYE, you still need to meet certain qualifying conditions for each benefit — such as a minimum period of employment, an earnings threshold, and specific notice requirements.
Working under an umbrella company gives you employee protections, but the way statutory payments are handled can vary between providers. Always check how your umbrella processes SMP, SPP and SSP to make sure you don’t miss out on what you’re entitled to.
Maternity Pay Rights for Umbrella Employees
If you’re pregnant and employed through an umbrella company, you could be entitled to Statutory Maternity Pay (SMP). To qualify, you must have been continuously employed by your umbrella company for at least 26 weeks up to and including the 15th week before your baby is due, and your average weekly earnings must be at or above the Lower Earnings Limit (LEL) for National Insurance.
You’ll also need to provide your umbrella with at least 28 days’ notice of when you want your maternity leave to start, and submit a MAT B1 certificate from your midwife or doctor confirming your expected due date.
Those who don’t qualify for SMP may still be able to claim Maternity Allowance through Jobcentre Plus.
SMP is paid for up to 39 weeks. The first six weeks are paid at 90% of your average weekly earnings before tax, and the remaining 33 weeks are paid at the statutory rate (or 90% of your average weekly earnings if lower). For the 2025/26 tax year, the statutory rate is £184.03 per week.
You’re entitled to take up to 52 weeks of maternity leave in total — 26 weeks of Ordinary Maternity Leave and 26 weeks of Additional Maternity Leave. The final 13 weeks are unpaid, but your employment rights and holiday entitlement continue to accrue.
Paternity Pay Rights for Umbrella Employees
Umbrella employees can also qualify for Statutory Paternity Pay (SPP) if they meet the eligibility rules. To claim, you must be continuously employed by your umbrella company for at least 26 weeks by the 15th week before the baby is due, and earn above the Lower Earnings Limit.
You must also be the child’s father, the mother’s partner (including same-sex partners), or an adopter or intended parent through surrogacy.
SPP is available for one or two consecutive weeks of leave, and must be taken within 52 weeks of the birth or adoption. For 2025/26, SPP is paid at £184.03 per week or 90% of your average weekly earnings (whichever is lower).
To claim, you’ll need to give your umbrella company 28 days’ notice before you want your paternity leave to start. You can also apply for Shared Parental Leave (SPL) if you and your partner want to share time off following the birth or adoption.
Sick Pay Rights for Umbrella Employees
If you fall ill while employed under an umbrella company, you may be entitled to Statutory Sick Pay (SSP). To qualify, you must have done some work for your umbrella, earn at least the Lower Earnings Limit, and be sick for four or more consecutive days (including non-working days).
SSP is currently £116.75 per week for up to 28 weeks and is paid through your umbrella company’s payroll in the same way as your normal wages, subject to tax and National Insurance deductions.
If you don’t qualify for SSP — for example, if your earnings fall below the threshold or you’re new to your umbrella — you may be able to claim Employment and Support Allowance (ESA) instead.
Continuity of Employment and Switching Umbrellas
One of the biggest issues umbrella employees face when claiming statutory benefits is maintaining continuity of employment. If you move between umbrella companies or experience a break in assignments, this can disrupt your qualifying period for SMP, SPP or SSP.
Because each umbrella company is a separate employer, switching between them usually resets your employment start date. If you plan to take leave in the near future, it’s worth confirming with your umbrella provider whether your employment continuity will be maintained.
Choosing a Compliant Umbrella Company
Not every umbrella company handles statutory payments correctly. Some less reputable providers fail to administer SMP, SPP or SSP in line with employment law — which can leave you out of pocket.
To protect yourself, choose an umbrella company that is FCSA or Professional Passport accredited. These organisations audit umbrellas for compliance and ensure statutory employee rights are honoured.
You can compare trusted, compliant providers in our Top 10 Umbrella Companies list.
What to Do if You’re Denied Statutory Pay
If your umbrella company says you don’t qualify for statutory pay, they must give you a written explanation using an official form (such as SMP1, SPP1 or SSP1). You can then use this form to claim alternative benefits from HMRC or the Department for Work and Pensions.
If you believe you’ve been treated unfairly or your rights have been breached, you can seek guidance from ACAS or raise a complaint through an employment tribunal.
Key Takeaway
Umbrella employment means you’re not on your own when it comes to statutory rights. As long as you meet the qualifying criteria, you’re entitled to maternity, paternity and sick pay just like any other employee.
The key is to stay informed, give your umbrella company the right notice, and make sure you’re with a compliant provider that respects your employment rights.
