There is nothing in the law to prevent payment of SMP in a lump
sum.
However, if an employer asks about making such payment
advise them that doing so could cause an overpayment of wages and
lead to an underpayment of NICs.
This would occur if there is a change in the
employee’s circumstances during the MPP after the lump sum
has been paid which reduces her entitlement to SMP, for Change in
Circumstances see
SPM21100.
Any overpayment must not be treated as SMP - it is an
overpayment of wages. If an employer has overpaid an employee their
only recourse is to recover it from the employee.
If the employer recovers an amount from the NI Fund based on
the amount wrongly paid to the employee as SMP, rather than the
amount that was actually payable, they will be recovering too much
and this will then cause an underpayment of NICs which must be
corrected.
Also, if the employer decides to pay SMP in a lump sum, the
employer and employee could pay more in NICs than if it was paid
weekly or monthly.
