Personal development
to forecast the cost impact of this change for employers. Given the variability of pay that would be subject to NICs across many companies, this is a particularly challenging figure to estimate. The interaction between net pay and Universal Credits (UC) was also highlighted. The reduction in net pay could result in those who are paid less benefitting from increased UC, hopefully protecting those individuals at the lower end of the pay scale. The panel considered how employers would manage the cost increase. Firstly, how they would support employees to understand the impact to their pay. A few panel members were intending to distribute communications ahead of the April 2022 pay day. Secondly, the panel discussed how employers could absorb the additional employment costs. The current labour shortages in the market were thought to make it unlikely to impact employee pay. More viable options included absorbing the cost through productivity improvements or passing the cost on to the consumer.
day, otherwise known as pay on demand (PoD), is an emerging area in payroll, and employers often engage with these facilities to improve employee engagement and retention. Those who are in support of PoD often reference it as an alternative to pay day loans, overdrafts or credit card interest rates. The panel recognised that a saving in interest was possible, alongside protection of credit rating when engaging in riskier lending. There were some concerns about this concept, including the risk of stepping onto the ‘advances treadmill’ and perpetuating the cycle of debt. However, the panel recognised that some solutions offered restrictions that allowed employers to reduce the availability of advances that were taken consecutively, encouraging employees to take a break between draw downs. It was also highlighted that the Financial Conduct Authority (FCA) recently conducted a review that resulted in ‘buy now pay later’ schemes becoming subject to regulation. The FCA has not taken the same measures with PoD but did state that a code of practice should be created. Looking to the future, some panel members considered whether an employee right to request a payment
date could be a possible step forward in the profession.
Single enforcement body The introduction of a new single
enforcement body (SEB) was announced in June 2021, and amongst other things, will be responsible for enforcing national minimum wage, statutory sick pay and holiday pay. The details and timeline are yet to be confirmed but the panel were keen to understand how this project would progress. There was agreement that resource would be key to any success of the SEB, given the breadth of topics it covered, and there was some hesitancy on whether it could meet the grand expectations that had been set. The panel will continue to debate this topic as more details are shared. Howcanmembers get involved in the technical panel? The CIPP is keen to hear questions and topics that members would like to see debated and discussed by the technical panel. If you have anything you would like to ask, please email the policy team, at policy@cipp.org.uk to get your issues on the agenda. ■
Pay on demand The ability to access earned pay before pay
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17 November – Statutory payments With the complexity of statutory payments increasing, the Policy team will take you through the basics and the not so basics of some popular statutory payments. 14 December – Overpayments Join the CIPP’s Policy team as we discuss best practice ideas for over payment prevention and examples of how to correctly calculate overpayments made.
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| Professional in Payroll, Pensions and Reward |
Issue 75 | November 2021
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