Professional May 2019

Official publication of The Chartered Institute of Payroll Professionals

in Payroll, Pensions & Reward

Issue 50 May 2019

Work-life balance

Annual leave and the law Recent cases

Arrears of pay The scale of it all

Payrolling – yes or no? Weighing it up

CIPP update | Policy hub | Career development

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Editor’s comment

I was pleased to attend a national minimum wage roundtable held by the CIPP in March at the London offices of Portfolio Payroll. You’ll find a report in the online version. There is clearly much misunderstanding and

been paid. There is, for example, the notorious Mencap case (see pages 22/23), which will be finally decided by the Supreme Court. There is also the question – as yet, not probed – of whether the answering of out of hours work-related calls, texts or emails counts as working time. Surely, if the employer ‘permits’ this to happen, it must be work? Would banning such out of hours activity be important too for observing a work-life balance?

concern about various aspects of the NMW legislation. Indeed, some might think that complying with NMW rules has become the biggest challenge currently facing payroll – perhaps it always was, though other compliance issues held our attention. A conundrum for employers and payroll professionals is what counts as ‘working’ for purpose of calculating whether the NMW has

Mike Nicholas MCIPP AMBCS (editor@cipp.org.uk) Editor

This month’s edition looks at different points of view to achieving a work-life balance and approaching health and well-being as a key facet to your ability to produce great work. Too many long hours or long commutes will eventually have a detrimental impact on your effectiveness, and so must Chair’s message

greater flexibility. This must still be managed though, so that employees feel connected and supported and not out of sight and out of mind as a result of not being in the office. Too much time alone and not connected can also have a detrimental effect. For remote workers or those who are less frequently working from a staff base, it is important to create connections through working groups and collective responsibilities, so that communication channels and information flows freely, and those water-cooler moments of catching up can happen virtually. In whatever way you may be considering flexible working, I urge you to consider it, as in my experience it does create opportunities for both the employer and the employee to take advantage of ways of working that can improve productivity and definitely supports a greater work-life balance. I hope you enjoy this issue.

be balanced with time out. Being able to spend time with family and friends, when you are truly present, contributing and not just ‘passing through’ or in pause mode because you are exhausted from work, is essential to a rounded work-life balance. Employers must consider why they need to have someone at a desk 9a.m. to 5p.m. If it is about customer service and availability, what challenges have been considered for working differently? Having held several global positions in my career, I could not have led teams by physically being in each location, so relied on technology to keep connected. Collaborative tools, video conferencing and improvements in broadband make this so much easier. It is empowering to allow staff to make choices and creates stronger engagement when recognising virtual working is a benefit to employee and employer if it reduces the commute or allows

Jason Davenport MCIPP MIoD (jason.davenport3@cipp.org.uk) Chair, CIPP

In March, I was honoured to attend the inaugural meals for Chartered Members. I met successful payroll, pension and reward professionals who are very supportive of the CIPP and its ideals of promoting education, training (and of course CEO’s message

In addition, many of the Chartered Members hadn’t personally met before so it was a tremendous networking opportunity. Also fascinating were the personal stories of how each one, in different ways, embarked on their individual membership journey, by taking full, individual responsibility for their personal journey and career in their respective profession. We hope to promote some of these career journeys in magazines to follow. So, wherever you are on the membership journey here is an aspiration for you to pursue. Chartered dinners will be held three times a year (in two locations at a time to ensure all Chartered Members get to attend) and you could be part of this group yourself one day. To find out more about Chartered membership and to see if you would qualify to upgrade please contact our membership team www.membership@cipp.org.uk.

individual membership). It was reassuring that the Chartered Members who attended wanted to play an active part in supporting the CIPP through thought leadership as well as being a voice on the direction and ideas put forward by the CIPP and particularly HMRC. It was encouraging that they want to volunteer and play a supportive role at meetings and events throughout the UK promoting the CIPP message to payroll, pensions and reward professionals as well as contributing thought leadership within their respective professions. It was inciteful to hear about their education experiences and to understand the importance of investing in formal training not only to achieve their goals but also to stand out. If you feel inspired and would like to find out more about the industry benchmark qualification – the Foundation Degree in Payroll Management – visit the CIPP website.

Ken Pullar FCIPP (ken.pullar@cipp.org.uk) Chief executive officer, CIPP

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| Professional in Payroll, Pensions and Reward |

Issue 50 | May 2019

in Payroll, Pensions & Reward PROFESSI NAL

Also available online at payrollpensionsandreward.org.uk

Contents

May 2019

46

Work-life balance

Jerome Smail reveals issues, research findings, and solutions

Features

9

16

15

Improving the interview experience Charles Hipps provides advice

Fixing bad managers Julie Lock reveals the problem and the solution

Spring Statement The policy team provide a summary

21

24

28

NMW – the best/worst mistakes Tim Bridgett reviews and provides commentary

Arrears of pay Justine Riccomini explores the tax etc issues

Payrolling – yes or no? Samantha Mann presents survey findings

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| Professional in Payroll, Pensions and Reward | May 2019 | Issue 50

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33

Chief executive officer Ken Pullar FCIPP CIPP board of directors Jason Davenport MCIPP MIoD Stuart Hall MCIPPdip Ros Hendren MSc, FCIPPdip, CMgr FCMIdip, FHEA Dianne Hoodless MSc ChFCIPP FHEA Liz Lay MSc FCIPPdip Karen Thomson MSc ChFCIPP, FHEA Cliff Vidgeon BA (Hons) CMA, ACIS, FCIPP Ian Whyteside MCIPP, FMAAT, ATT Editor Mike Nicholas 01273 412 836 | editor@cipp.org.uk Advertising Jill Bonehill 0121 712 1033 | advertising@cipp.org.uk Design James Bartlett and Nicole Davis design@cipp.org.uk Printing Warwick Printing Company Ltd

How pensions puncture productivity Henry Tapper outlines the complex effects

The net pay scandal Ian Neale discusses this growing issue

38

36

Disability, discrimination, comparators Nicola Mullineux outlines decisions

Annual leave and the law Jill Smith discusses recent cases

45

40

Useful contacts

Re-thinking short- and long- term saving Matthew Blakstad reveals a pilot

Scrapping a bonus scheme Danny Done sets out implications and procedures

Membership membership@cipp.org.uk 0121 712 1073 Education education@cipp.org.uk 0121 712 1023 Training admin@cipp.org.uk 0121 712 1063 Events events@cipp.org.uk 0121 712 1013 Marketing and sales marketing@cipp.org.uk 0121 712 1033 General enquiries info@cipp.org.uk 0121 712 1000

Regulars

01 Editor’s comment, Chair’s andCEO’s messag e

20 Payroll news 21 Payroll insight

Events, news and developments

04 Membership insight

On your behalf, Advisory, Five minutes with

32 Pensions insight 35 Reward insight 45 Feature articles A family affair 54 Confessions of a payroll manager

10 Events horizon 11 CIPP update 12 Industry news 13 Career development insight Diary of a student, CPD, Movers and shakers

cipp.org.uk @CIPP_UK

Articles Please support this magazine so that it can continue to be a part of your membership package. Trademarks The CIPP logo, the initials ‘CIPP’ and the words ‘Professional in Payroll, Pensions and Reward’ and ‘CIPP Consult’ are trademarks of the Chartered Institute of Payroll Professionals. Copyright: The Chartered Institute of Payroll Professionals 2019. The Chartered Institute of Payroll Professionals, CIPP, Goldfinger House, 245 Cranmore Boulevard, Shirley, Solihull, West Midlands, B90 4ZL. Switchboard 0121 712 1000 Fax 0121 712 1001 Copyright This magazine is published by The Chartered Institute of Payroll Professionals in whom the copyright is vested. All rights reserved. No part of this publication may be reproduced, stored in a retreival system, or transmitted in any form or any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of the publisher. The views expressed in this publication are not necessarily those of the CIPP or the editor. The information and comment contained in this publication are given in good faith, their accuracy or completeness cannot be guaranteed.

Additional online content 26 NMW roundtable 35 Are all rest breaks created equal?

42 GDPR compliance failure 43 More than wages, hours

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| Professional in Payroll, Pensions and Reward |

Issue 50 | May 2019

MEMBERSHIP INSIGHT

On your behalf

Policy team update

Diana BruceMCIPPdip, CIPP senior policy liaison officer, discusses responses to recent consultations

NMW consultation In the April issue we said we’d provide a summary of the responses we received to our survey about the consultation on national minimum wage (NMW) – salaried workers and salary sacrifice, because at the time it was still running. People who perform salaried hours work are paid an annual salary in equal weekly or monthly instalments, for an annual number of hours. The legislation provides a set of rules about compliance when regular salaries are paid. Certain conditions must be met in order for work to qualify as salaried hours work under the NMW regulations. The consultation sought views on how effective these rules are in preventing worker exploitation. The consultation also asked for views on proposed changes to the regulations which relate specifically to salaried hours work, and whether they might be amended to include additional payment cycles and fixing the definition of the calculation year for employers, without any detriment to workers. We received 177 responses to the survey. We thank all those who took the time and effort to contribute. Payroll professionals together with their software developers play an instrumental role in ensuring good levels of employer compliance with the regulations and are the first to recognise the importance of well-written legislation that represents

modern working practices. It is the sharing of your valuable knowledge and experience that gives credence to our consultation response. What did you tell us? ● ● All regular payment cycles should be allowed within the definition of salaried hours work to bring the operation of NMW in line with other pay calculations (e.g. pay as you earn income tax, class 1 National Insurance contributions, automatic enrolment). This would benefit: ❍ ❍ workers who could then benefit from equalised payments made throughout the year and not be subject to hardship caused by seasonal ‘peaks and troughs’ of demand in some sectors which affect availability of working hours ❍ ❍ employers whose compliance would increase. Many employers are unaware of the divergence between the operational rules for NMW and other pay/employment tax ❍ ❍ government in its work to modernise the work place and enable employers with salaried workers to fully engage with flexible working in all its variations. ● ● Overtime, pay premia and allowances should be more widely included as acceptable payments for NMW and thus should be allowed within annual salary calculations. ● ● The calculation year should be set at the employer’s discretion. ● ● Salary sacrifice should be allowed for all

employees where they have free choice to enter in to such agreements. We recognise that this poses further questions as to whether to broaden the range of benefits in kind (BIKs) that can be included within minimum wage calculations. ● ● Comprehensive and consistent guidance aids employer compliance. A failure by the employer to comply is also a failure of state to provide. Greater use should be made of case studies to demonstrate compliant and non-compliant employer behaviour. There are other restrictions within the NMW regulations that are not fit for purpose and further consultation needs to explore these fully. The following list is illustrative but not exhaustive: TOIL (time off in lieu); living accommodation rules – particularly the exclusion list for socially aware landlords; voluntary deductions. Our consultation response suggests improvements to the regulations to help the majority of those striving to be good employers by providing fair and decent work and working conditions that comply with legislation and which fit within modern pay operations and practices of the 21st century. We hope that this consultation marks the beginning of an ongoing conversation as to how the regulations can be updated to achieve this essential aspiration. The CIPP’s formal response to the consultation is available to view in full on www.cipp.org.uk under My CIPP/Policy hub. Redundancy protection In the April issue OYB we mentioned a survey running on the proposal to extend redundancy protection for women and

...beginning of an ongoing conversation as to how the regulations can be updated...

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| Professional in Payroll, Pensions and Reward | May 2019 | Issue 50

Policy hub

Achieve the highest level of professional recognition CHARTERED MEMBERSHIP Chartered membership is CIPP’s highest level and demonstrates that you are a highly qualified, compliant payroll professional, committed to maintaining high standards in payroll knowledge and experience. It inspires confidence with employers and clients, and reduces organisational risk.

new parents. The consultation, which was published in January, recommended that the current protection afforded to the period of maternity leave under the Maternity and Paternity Leave etc Regulations 1999, be extended to cover both the period of pregnancy and for the six months period beyond. The proposal is the government’s commitment made in response to the Taylor Review, and had previously been raised by the Women and Equalities Select Committee. ...to protect women especially if they return on a part-time basis... We received 22 responses to the survey we ran for this consultation and can provide a summary of the results. Three in four respondents (i.e. 75%) agreed or strongly agreed that protections against redundancy for a period following return to work should be aligned with those already in place during maternity leave. disadvantaged and unfairly selected for redundancy whilst on leave and in some cases a few months after they have returned to work ● ● to protect women especially if they return on a part-time basis ● ● protection should be in place, but it should not mean that a returnee from maternity leave would be placed in a role that they could not do which would therefore have a negative effect on the company, rather than someone who is skilled in that role being offered it first. On asking about the costs to businesses that an extension might bring, responses included the possibility of losing the wrong people in a restructure situation. About the cost to individuals, responses included that additional responsibilities may be added to the role, and a higher risk of redundancy if not returning from maternity leave due to being 'lower' in the order for possible restructuring. As regards the benefits the extension may bring, responses for business benefits included: retaining qualified/experienced staff; diverse employers who look out for everyone’s needs; business would be able to assess better a person's skill once they are settled into the routine of their job, Some of the reasons given were: ● ● experience of women being

and therefore if the job is still required in a restructure situation. The responses for individual benefits included: women would be less exploited; might encourage more women to return to work; beneficial from a well-being perspective; gives the individual a settling in period; for those returning better job security, but none for others. As to whether six months would be an adequate period for redundancy protection purposes, 75% said yes, six months was adequate, but 25% disagreed. Comments included: it should be one year, as some employers wait until the employee returns and then dismiss them on redundancy grounds within six months of returning; a fair amount of time to make it affordable for employers (depending on the size of the employer); gives a further advantage over all employees who could be part of a redundancy situation; three months would be classed as adequate as they are protected from beginning of pregnancy to the end of maternity leave and this gives them up to eighteen months of being out of scope for redundancy compared to their colleagues and could be deemed as advantageous for women. In response to the question “Should pregnancy for redundancy protection purposes be defined as starting at the point a woman informs her employer that she is pregnant in writing?”, 13% strongly agreed; 13% agreed; 24% neither agreed nor disagreed; 37% disagreed; and 12% disagreed. In response to whether a different reference point should be used, three in four said yes, a different reference point should be used. Comments included: two to three months prior to expected week of confinement; at the point the employee is leaving to start her maternity leave; and one caveat would be if redundancy procedures had already begun. The consultation also asked that if additional redundancy protection is extended to mothers returning to work after maternity leave, are there other forms of leave which should be considered also, citing as examples: adoption leave, shared parental leave (SPL) and longer periods of parental leave. All respondents indicated that adoption leave should be considered; the majority thought SPL should be considered. Our full response to the consultation is available at www.cipp.org.uk under My CIPP/Policy hub. n

For more information: Visit: cipp.org.uk/chartered Email membership@cipp.org.uk Call: 0121 712 1000 Live chat with us

cipp.org.uk @CIPP_UK

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| Professional in Payroll, Pensions and Reward |

Issue 50 | May 2019

*correct at time of publication

MEMBERSHIP INSIGHT

a current maintenance arrestment, a conjoined arrestment order” and “Don’t make any student loan deductions if you have a DEO [deduction from earnings order] and a Scottish court order to apply.” So, the court order has priority and student loan deductions must cease until the court order has been paid in full. Q: From April 2019, we will start to payroll our benefits in kind. We understand that we must pay particular attention to the regulatory limit so that employees do not have more than 50% deducted in tax. Can you please clarify what the limit would be for an employee whose monthly salary is £2,000 with a benefit charge of £3,000 a month? A: The regulatory limit refers to 50% of the employees ‘pay/earnings’ and does not include the amount that is being payrolled. In your example, the’ regulatory limit is £1,000, so based on tax code 500L, taxable pay of £5,000 (earnings plus amount to be payrolled) and using period 1 as an example, the tax due would be £1,257.80. As this is over the regulatory limit, you will be unable to take the full amount of tax due. If this were to happen on your payroll, you have two options going forward. You can either: ● ● stop payrolling the benefit, in which event you will then need to continue to report the benefit via a P11D return at the end of the tax year, with HM Revenue & Customs (HMRC) sending an adjustment to the employee’s tax code for the following year to collect the tax owed, or ● ● you could continue to payroll the benefit and carry over any uncollected tax to the next period. If there are insufficient pay periods to recover the uncollected tax, then once the final full payment submission is made, any underpaid tax will be included in an end of year tax calculation sent to the employee by HMRC. Q: Will HMRC be informing employers about those employees who will have prefix C tax codes? Should we apply the same ruling as we do for new starters resident in Scotland – only use the prefix if advised via a P45 or P6 notice, ignoring the employee’s address? A: Yes, you are correct. HMRC will notify

Advisory Service is available 9a.m. to 5p.m. Mondays to Thursdays, and 9a.m. to 4.30p.m. on Fridays * . Call 0121 712 1099 , email advisory.service@cipp.org.uk or visit cipp.org.uk to live chat.

Advisory

*please see summary at cippmembership.org.uk for details.

Q: We have assumed that the new national minimum/living wage (NM/ LW) rates are due from 1 April 2019. However, as we pay on the 25th of each month and the payment relates to the period 1st–30th/31st of that month, are we able to implement the new rates from 25 April? A: The new rates are to operate from 1 April 2019, and you should apply them to pay reference periods beginning on or after this date. In your case, pay day 25 April 2019 has a pay reference period of 1–30 April. I can confirm in your situation you would increase the rate from 1 April 2019. If your pay reference period was, say, 1–31 March, paid on 25 April, the start date of the pay reference period would be 1 March 2019 so the new NM/LW rate would not be due until the following month in May 2019. Q: Our business is reaching its three- year re-enrolment date for automatic enrolment. What is the process for re-enrolment of employees who have previously opted out, and are they entitled to opt-out again? If the answer is ‘yes’, within what time-period are they required to provide notification? A: The full process for re-enrolment of employees can be found on The Pension Regulator website at http://bit. ly/2uFsmp9. Eligible jobholders have a period of one month after automatic re-enrolment during which they may choose to opt out. This process is the same for automatic enrolment, so an employer can

utilise their existing opt-out and refund processes. Guidance on re-enrolment can be found here: http://bit.ly/2FKsJUqt. Q: We operate a cycle to work scheme involving salary sacrifice. Can electric bikes be included, and what if the cost is more than £1,000? A: The guidance states that electrically assisted pedal cycle can be included. Please see the guidance at this link: http://bit.ly/2K3BUos. If you allow the value to be above £1,000 the guidance indicates that you will need a special group license: “If employers also undertake regulated business other than that described in the group licence or wish to offer packages in excess of £1,000, they will need to obtain a standard consumer credit licence to cover that business.” monthly. This month the government gateway has flagged that no student loan deduction has been made. The only difference to the employee’s pay this month is that there has been a Scottish court order deduction processed. Is the system actioning this correctly? A: Your system has acted correctly. The legislation for student loan deductions and Scottish court orders differ from that applicable across the rest of the UK. The GOV.UK guidance (http://bit.ly/2FWWdjd) advises: “Don’t make any student loan deductions if you’re required to apply any of the following: an earnings arrestment, Q: A plan 1 student loan deduction operates for an employee paid

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| Professional in Payroll, Pensions and Reward | May 2019 | Issue 50

R E V I S E D C O U R S E

Policy hub

LEAD YOUR PROFESSION LEAD YOUR BUSINESS

employers of when and for which employees a C prefix code is to be operated. You should have received P9 notices for current employees indicating if the prefix is to apply. However, for a new employee you should use the code provided in form P45 but if no P45 is received and a new starter declaration has been submitted, you should use the tax code in relation to the statement chosen. If a prefix C code is to be applied, you will receive notification directly from HMRC. Remember that you as an employer cannot make the decision to apply prefix C, you must wait for notification from HMRC before you make the change. If your employees contest this addition to their code, they will need to log into their personal tax account and ensure that their address details are up to date. Q: Should a payroll bureau or department adjust an employee’s tax code if their earnings exceed £100,000? A: This is referred to as ‘adjusted net income’ and it is only HMRC that can change the tax code. It isn’t just the income that falls within pay as you earn (PAYE) that is considered, so the employer would not necessarily know when the employee would breach the threshold. HMRC would include income from the employment both cash and benefits, profits from self-employment, some state benefits and pensions, to name but a few. Q: One of my clients had been deducting class 1 National Insurance contributions (NICs) from an employee until August last year but the deductions have ceased as the employee is now on ‘C’ category for NICs. Can you think of any reason why the employee should have been placed onto C rate category as he is only 58 years old? A: In answer to your query if this is for employment earnings then there would be no reason to apply NICs table letter C at this stage. This needs to be corrected before the end of the tax year if an error has occurred. Usually, the NICs category table letter is only changed to C when the employee reaches state pension age. If the employee becomes a pensioner of the company then the table letter

would change to X, as pension paid by the employer from an approved pension scheme is not subject to NICs. You may find the following two links to HMRC’s National Insurance Manual helpful; the first link explains that you have to correct the error as soon as possible and the second link explains how you can recover NICs from employees: http://bit. ly/2HTSNQt and http://bit.ly/2CRCDmt. Q: If we have a new employee who has signed statement B in the starter checklist we are to operate ‘week 1/ month 1’, but what does this mean? A: ‘Week 1/month 1’ means that if the employee is paid monthly apply month 1 to the tax calculation (known as tax basis) or if the employee is paid weekly then apply week 1. Normally, the tax basis of an employee is cumulative which means (if they are paid monthly) they are receiving 1/12th of their personal allowance. So, based on £11,850 the first month’s allowance would be £987.50; as it is cumulative in the second month the total would be £1,975.00 (adding the previous month’s allowance to the current month); and in the third month it would be their allowance for that month of £987.50 plus the previous two months’ cumulative total of £1,975.00 which is a total of £2,962.50 for month 3; and so on. A non-cumulative basis means that previous pay and tax are ignored and in effect their earnings are taxed as if it was either week 1 or month 1 each pay period. This non-cumulative tax basis means that the employee will not be due a tax refund until HMRC changes the tax code. Where HMRC sends you a P6 notice with this tax basis during the tax year it means that if the tax code is lower than the current one you are operating the employee will not face a huge tax deduction but have the tax due spread over the remaining tax year. Q: Is there a set time for providing information on payrolling benefits to employees? A: The deadline the employer must provide information to the employee is 1 June. It should show: type of benefit; cash equivalent; amount which is subject to optional remuneration arrangements; and details of benefits not payrolled. n

The CIPP’s MSc in Strategic Leadership has been revised and updated to provide payroll, HR and reward managers with the skills and knowledge to help shape the future of their organisation at a strategic level.

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For more information or to enrol: Visit: cippqualifications.org.uk Email education@cipp.org.uk

Call: 0121 712 1023 Live chat with us

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| Professional in Payroll, Pensions and Reward |

Issue 50 | May 2019

MEMBERSHIP INSIGHT

5 minutes with…

JustinMingaye BA(Hons) CMgr MCMI Membership manager

CIPP for joiners. I am also leading the new #BePayroll initiative which is set to launch at our National Forum on May 2; so please get involved by using the campaign’s hashtag when talking about your career and the industry on social media. What do you do to unwind? My wife and I recently celebrated our first wedding anniversary, and our son will be turning two late summer. We enjoy our little family adventures at weekends and regular get togethers with the wider families. I play tennis a couple of times a week, and have got back into regular gym activity. I’m big boxing fan and top of my bucket list would be to watch a world title fight, ringside in Vegas. What do you think you can bring to the future strategy of the CIPP? I am passionate about highlighting the impact that education and professional development can have. What I lack in knowledge of paying and rewarding people, I make up for in experience of membership growth and partnership engagement. My experience of the CIPP so far tells me that I am in a good organisation and the right role to help put practices in place to support this. I am looking forward to collaborating right across the profession to implement our strategies for acquisition and retention. Delivering our membership strategies will be a challenge. Despite being a relatively newer professional body, the CIPP has had the benefit of starting with a highly engaged core base of members in the industry and thousands of individuals joining our qualifications and courses every year. n You can get hold of me on LinkedIn, via 0121 712 1005 or justin.mingaye@cipp.org.uk .

Overview of my career, work history and background I graduated in 1999 with a honours degree in marketing, and my sandwich year gave a good taste of the corporate world with placements at Vauxhall and Calor Gas. My early career saw me drift into sales, where I spent four years with the American conglomerate Citigroup. My first professional body role followed this and I joined the Institution of Engineering and Technology (IET) as a regional development manager covering the West Midlands and Wales. It quickly become the best job I’d ever had giving me exposure to some of the world’s leading professional initiatives being delivered right across industry and academia. Alongside the growth in my region, I am most proud of a scheme that I developed and tested with a cohort of my top partners, which rolled out nationally and saw us register more engineers to chartered status since our move to a new competency framework seven years earlier. My region and contribution also helped to initiate the academic partners scheme and re-purpose a membership offer to support graduate transition that became the IET advantage programme. These experiences were a natural fit for my next role at Coventry University where I managed the external schools partnerships programmes, the clearing and confirmation operation, and worked across the University group to provide data driven support to areas such as recruitment, partnerships, course development and marketing. Before joining the CIPP last year I was responsible for the partnership operations

in the higher education department at the Chartered Management Institute. I successfully supported the membership and financial growth with our university partners and introduced the student and partner engagement operations that helped ensure the growth was value based, long- term and sustainable. Tell us about your role at the CIPP I have been tasked with increasing the size of our professional community by implementing membership acquisition and retention strategies. It’s exciting to be here for the start of a round of strategic planning by the senior team for me to implement. professional development scheme as well as engage more widely with the Institute’s membership base through effective administration and partnerships. Since joining in September 2018, I have completed my induction, met many members and got exposure to our range of business activities. I’ve already helped introduce welcome updates to membership criteria and improved the user experience and response rates to our annual market insight survey. Having been heavily involved in chartered membership in other organisations, I am pleased that recommendations for improvements to our scheme following a three-month review were approved. Process reviews across membership are ongoing and one of the results will be new membership communications and processes to ensure a much-improved early experience with the Other objectives are to deliver a successful and relevant continuing

| Professional in Payroll, Pensions and Reward | May 2019 | Issue 50 8

Policy hub

Spring Statement

The CIPP policy team provide a summary

O n 13 March 2019, the Chancellor of the Exchequer, Philip Hammond, gave his Spring Statement. (Visit http://bit.ly/2K5TmJ0 for details.) As anticipated, there were no surprises for payroll, pensions or reward in his short account, but minimum wage, apprenticeships and the employment allowance all featured. Many of the commitments the Chancellor did announce hang in the balance as we wait to learn when the UK will be leaving the European Union (EU). If an exit deal is agreed, the government will hold a spending review which will conclude alongside the 2019 Budget and set departmental budgets, including three-year budgets for resource spending. Minimumwage A new review is to take place on the employment and productivity effects of minimum wage rates in the UK, starting with a roundtable in April to be chaired by the Chancellor. The government has published a new remit (http://bit.ly/2CY1Bkf) for the Low Pay Commission (LPC) asking for recommendations for the national minimum and living wage rates that should apply from April 2020. The LPC has already opened its annual consultation on this – the closing date for submissions is 7 June 2019 – and its report is to be submitted by October 2019. In addition, the LPC has its annual programme of visits around the UK (http://bit.ly/2K9bLEG) which allows it to hear directly from workers and businesses as to how their minimum wage recommendations are working ‘on the ground’. The Chancellor announced the appointment of professor Arindrajit Dube to undertake a review of the international evidence on the impacts of minimum wages. The terms of reference, which can be found here: http://bit.ly/2G1z7YM, include considering the implications for future minimum wage policy in the

UK, bearing in mind the aspirations the government set out in Budget 2018 to end low pay in the UK. The conclusions will inform work underway in HM Treasury and the Department for Business, Energy and Industrial Strategy considering the future remit of the LPC after 2020. This wider work will include broad consultation with a range of stakeholders. ...the co- investment rate for smaller businesses taking on apprentices will halve from 10% to 5%... Employment allowance As announced at Budget 2018, from April 2020 the employment allowance will be restricted to organisations with National Insurance contributions below £100,000 in the previous tax year. Draft regulations have been published inviting technical comments on the implementation of the reform. Apprenticeships In Budget 2018, the Chancellor announced measures would be introduced aimed at encouraging more businesses to employ an apprentice. The Spring Statement confirmed that the co-investment rate for smaller businesses taking on apprentices will halve from 10% to 5% and take effect from 1 April 2019. What is still not clear is whether the 5% contribution will only apply to new starters from April 2019 or whether this reduced contribution will also apply to levy-paying employers when their levy pot is empty. This measure is in addition to the increase to the amount levy-paying employers are able to transfer to other employers, including those in their supply

chains, which will increase from 10% to 25% from April 2019.

Making tax digital The vast majority of valued added tax (VAT) registered businesses with a taxable turnover above the VAT threshold (£85,000) will be mandated to keep digital VAT records and send returns using compatible software from April 2019. It was announced in July 2017 that the pace of mandation would be slowed and that making tax digital (MTD) will not be mandated for taxes other than VAT until at least April 2020. The Chancellor reaffirmed these plans and promised firms they would not face fines if they do their best to adapt. Similar reporting standards for income tax, expected to be introduced in April 2020, have been pushed back by at least a year; however, businesses can get involved in the income tax pilot now on a voluntary basis. Tax avoidance, evasion and non-compliance Since 2010, the government has: secured and protected over £200 billion of tax that would otherwise have gone unpaid; introduced over 100 measures to reduce avoidance, evasion and other forms of noncompliance; and continued to support taxpayers to get their tax right. Alongside the Spring Statement the government published a paper (http:// bit.ly/2Iacxic) setting out its approach and achievements in tackling tax avoidance, evasion and other forms of non-compliance. The paper: outlines the strategy and approach of HM Revenue & Customs (HMRC) to compliance for different taxpayers; details the government’s record in addressing areas where risks of non-compliance have been identified; and provides a summary of the government’s record of investment in HMRC and its commitment to further action. n

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| Professional in Payroll, Pensions and Reward |

Issue 50 | May 2019

Full details of events and training courses can be found at cipp.org.uk or you can email info@cipp.org.uk for more information. Events Horizon

Course

Date *

Location

Course

Date *

Location

5 June

14 June

NEW COURSE – Computerised payroll level one

NEW COURSE – CEO pay ratios reporting

All online

3 July 7 August 3 June 4 June 10 June 12 June 13 June

All online

15 July 15 August

London

14 June

Edinburgh

Payroll and HR legislation update (50% off for members)

NEW COURSE – Computerised payroll level two

15 July 15 August

All online

Cardiff

Cambridge

Birmingham

Manchester

11 June

Salary sacrifice and other optional remuneration arrangements

Birmingham

3 June

London

13 June

London

12 June

P11D, expenses and benefits

Birmingham

10 July

Manchester

17 June

Dates are subject to change. More dates are available at www.cipp.org.uk/payroll- training-listing

Cardiff

7 June

Employment status and modern working practices

Have you considered in-house delivery of training courses?

Birmingham

19 June

London

24 July

Can’t find a date or location to suit your needs? Let us know by visiting cipp.org.uk/trainingreg . New dates and locations may be added if there is enough interest.

National forums Exclusive to CIPP members * , the national forums are a perfect opportunity to hear from the policy team, as well as other key speakers, on developments in payroll, pension and reward legislation. This event will also provide an excellent chance for you to network with other CIPP members.

Scottish National Conference and Exhibition 2019 5 September 2019 | Dynamic Earth, Edinburgh We are delighted to announce the return of the CIPP’s Scottish National Conference on 5 September 2019. This prestigious event will be held at Dynamic Earth, a venue superbly located in the heart of Edinburgh’s World Heritage Site. Join us for a day full of interactive and engaging workshops and seminars. This is your opportunity to hear from our guest speakers and learn all about the latest changes and developments in payroll, pensions and reward. On the evening you are invited to meet with other payroll professionals and celebrate National Payroll Week at a drinks reception in the Dynamic Earth galleries. To view the programme and book your place, please visit www.cipp.org.uk/events or email us at events@cipp.org.uk . CIPP and ATT Payroll and employment taxes event These workshops will provide educational and interactive sessions on the latest payroll and taxation legislation and the recent changes relating to the Devolution of the UK, CEO pay ratios reporting and off-payroll working.

Available dates:

Glasgow

6 June

Newcastle

18 June

London

10 July

London

11 July

They also provide an excellent opportunity for members to achieve their CPD and discuss their CPD objectives and requirements with a member of the CIPP team. To view the programme and book your place, please visit www.cipp.org.uk/events or email us at events@cipp.org.uk .

Available dates:

Birmingham

17 July

Ipswich

29 May

Aberdeen

25 June 26 June

*applicable levels of membership only. Please be aware that lunch will not be provided.

Inverness

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| Professional in Payroll, Pensions and Reward | May 2019 | Issue 50

CIPP update

CIPP update

Demonstrating excellence in payroll processes THE FOLLOWING organisations have recently successfully achieved the CIPP’s Payroll Assurance Scheme: Access Group; and MP Payroll Solutions Limited. Ken Pullar, CIPP chief executive officer, said: “We are delighted that MP Payroll Solutions and the Access Group have joined the ranks of organisations to achieve this respected accreditation. It is imperative that payroll departments comply with government legislation and the Payroll Assurance Scheme is designed to help companies do just that.” Visit payrollcompliance.org.uk or email info@cipp.org.uk to find out more about the Payroll Assurance Scheme. To become a Chartered Member, or find out more, visit www.cipp.org.uk or email membership@cipp.org.uk . CharteredMembers THE CIPP is delighted to welcome our latest Chartered Member, following the panel meeting in March. Louise Gray ChMCIPP, payroll manager operations and delivery at PwC has become our first Chartered Member based in Belfast. Chartered membership demonstrates the highest level of professional membership in the industry, and recognises those individuals who have worked hard to raise the profile of payroll and their professional standing through education and continuing professional development. It demonstrates to employers that you are committed to keeping up to date and raising the standards of best practice within the industry. During March, the CIPP also successfully launched Chartered Member dinners and the Chartered Member committee. These two initiatives have been introduced to provide Chartered Members with additional networking opportunities and a forum to influence the future direction and profile of the CIPP.

Level seven apprenticeship launched WHILE CELEBRATING twenty years since our first cohort graduated with the MSc in Payroll, we are delighted to announce our new collaboration. Accredited by Loughborough University the MSc in Strategic Leadership is a new programme taught by CIPP tutors working within the profession. The uniqueness of this qualification is that it is targeted at professionals working in a mutual sector, with tutors drawing on their experiences from within the industry. We are also delighted that working with Loughborough University we can offer this programme through the traditional MSc route, as well as an apprenticeship route. The content will be the same regardless of the route taken, with the benefit of allowing employers the opportunity to take advantage of the apprenticeship levy, removing potential cost barriers. This level seven qualification, which requires strategic thinking and independent learning, is designed to equip the future leaders of tomorrow with the skills and knowledge they need to: ● add strategic value to their organisation We chose to partner with Loughborough University because of their substantial experience in the delivery of professional development programmes and their consistently high rankings within the top ten UK business schools by national league tables. These fit with the CIPP’s core values and quality objectives in relation to delivery of professional education to the payroll, pensions and reward professions. To find out more about the CIPP MSc in Strategic Leadership, visit www.cippqualifications.org.uk . Payslip distribution report – sponsored by Datagraphic THE CIPP has been conducting research into the long-term trends affecting payroll and payslips since 2008. The policy and research team would like to thank all those who responded, as we would not be able to undertake this research each year without the support and input from our members and the profession. The Institute extends thanks to Datagraphic for supporting this report, which can be found here: http://bit.ly/2K6iAqJ. This annual research looks at the number of people being paid, the frequency with which they are paid, how the payslips are distributed; as well as looking at the potential benefits brought by use of electronic payslips and the emergence of technology in the payroll profession. The statistics span a period of great change, both generally within the UK – including the economic recession and the vote to leave the EU – and more specifically within the payroll industry with the introduction of real time information and automatic enrolment. The report identifies key findings: ● monthly remains the most common frequency ● Friday continues to be the most common payday ● over a third use payslips to deliver other information to employees ● more than 95% of respondents say they use some form of electronic methods for distributing payslips. ● improve managerial business understanding ● lead and influence a team with confidence ● understand the challenges of change management ● effectively manage strategic projects.

The CIPP compact payroll reference THE INSTITUTE is delighted to confirm that the 2019–20 CIPP Compact Payroll Reference Book is now available. Associate, Full, Fellow and Chartered Members will be sent one copy of the book as part of a new tax year pack which is an additional benefit for these grades.

The pack will also include a handy wall planner and tax fact pen – all important tools to help you through the latest tax year. For non-members, affiliate members, or members wishing to purchase additional copies of the book, please contact the CIPP admin team ( info@cipp.org.uk ) for details.

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| Professional in Payroll, Pensions and Reward |

Issue 50 | May 2019

Industry news

Cascade HR reaches 1,000 customers HUMAN RESOURCES and payroll technology vendor Cascade HR (part of IRIS Software Group) has reached a significant milestone, with footwear retailer Pavers being its 1,000th customer to invest in the brand’s system. Launched to market in 2005, Cascade is the reinvigorated brand identity for Propath Software, a company that was first established in 1992. In 2014, Cascade became part of IRIS Software Group. As the largest privately-held software

company in the UK, a total of 2,300,000 people are paid through an IRIS payroll product; 83 of the country’s top 100 accountancy firms use IRIS; and 650,000 organisations use some form of an IRIS cloud application. Headquartered in Leeds but with offices throughout the country, Cascade HR currently employs 169 people – up 17% compared to this time last year.

Oliver Shaw, chief commercial officer of IRIS Software Group, commented: “Whilst many of the clients within our base are start-ups or emerging [small- to medium-size enterprises], we also support a number of household names and blue-chip firms with more than 10,000 staff. “But it’s also important to note that these customer numbers don’t include the businesses with 150 employees or less using our CascadeGo solution, which we brought into our suite following the acquisition of Octopus HR in 2016. When you factor in those figures – plus the clients we hold throughout IRIS as a group – 620,000 employees are managed with an IRIS HR solution.” HR systems and analytics RESEARCH CONDUCTED by Fosway Group, presented in partnership with SD Worx, a leading provider of global HR and payroll, reveals that HR professionals across Europe believe that though management and board members are in the main satisfied (or very satisfied) with their payroll and core/HR systems, they are much less satisfied with their HR analytics systems. The research also reveals that: ● 45% of companies are planning to increase investment in less than two years, growing to 65% within three years. This investment has been earmarked as being critical for success, with nearly all organisations surveyed (95%) agreeing that high-quality data and analytics are important to the future success of the business. David Wilson, chief executive officer of Fosway, said that “Good business analytics has become a core part of almost every business function, but adoption in HR has lagged other areas. “HR needs to really raise its game, but this will ● 76% of organisations are planning to increase investment in HR technology as a whole ● 68% of organisations identify HR analytics is the most common area for future investment

bring significant benefits to core processes too; from finding and retaining new talent, to improving internal processes and employee engagement. This impact will be felt business-wide.” Brenda Morris, vice president of SD Worx UK and Ireland, commented: “These figures show the increasingly important role that HR is playing in business. It’s clear from the survey that there is a real appetite to make improvements from both HR departments and key decision makers in businesses. While the investment into HR is welcomed, it still has its work cut out to get buy-in from the whole organisation in terms of using HR data and analytics business-wide. That is going to be the biggest challenge for HR departments over the coming years. But, if it’s done well, it will have the biggest impact”.

| Professional in Payroll, Pensions and Reward | May 2019 | Issue 50 12

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