Professional July/August 2020

Policy hub

PAYR LL NATIONAL WEEK 2020

...an opportunity for HMRC to continue to improve its communications...

National Health Service, when minimum wage rates increase significantly, as this effectively devalues the pay spines system, particularly at the lower levels. There was an agreed feeling that separate age rates were unfair. Why should somebody aged 20 receive a lower rate of pay whilst completing the same role as someone aged 25 doing identical work? The LPC’s suggestion of aligning the apprentice rate with the NMW rate for 16–17 year-olds was received favourably. The suggestion that those in certain sectors should command higher NMW levels, for example, in the care sector, was also offered, but the LPC confirmed that this is a political decision well beyond their remit. On the subject of NMW guidance, the general consensus was that it has improved massively but members were disappointed about the latest update to NMW regulations in relation to salary sacrifice. They felt that people who get paid at, or slightly above, the NMW could really benefit from some of the sacrifice arrangements that can be offered, but are being penalised due to legislative restrictions, and do not have the opportunity to make decisions for themselves. A concern was raised that other updates to salaried hours work, including the fact that employers can now decide on a new ‘calculation year’, together with the inclusion of two-weekly and four-weekly pay periods, for salaried hours workers, may have slipped under the radar due to the outbreak of coronavirus. The group felt that these changes should be re- communicated to ensure that employers and employees are aware of them. The meeting was highly beneficial, and the team gathered some great opinions and feedback, which were incorporated into the CIPP’s written response to the LPC’s consultation on NLW and NMW rates for April 2021. IR35 forum Even allowing for the UK-wide lockdown and significant focus of HM Revenue & Customs (HMRC) and other government departments on coronavirus measures, it might be surprising to hear that an

element of ‘business as usual’ activity has continued, albeit not in face to face meetings. The forum’s remit is: To advise on the administration of IR35 policy in practice, assisting HMRC by acting as a consultative body to: • provide HMRC with insights on the effectiveness of administration of IR35 on the ground • identify and discuss specific areas for improvement in the administration of IR35 • explore the implications of potential changes to policies, products and processes relating to IR35 • help HMRC to communicate key messages to the members of organisations represented on the forum and a wider audience about IR35, and to ensure that guidance and information is clear and accessible for customers. As you might imagine the attention of the forum over recent years has very much been on off-payroll reforms. In addition to the legislative transformation, focus has been on operational issues including the continued development and delivery of the CEST (Check Employment Status for Tax) tool. The postponement of these reforms to April 2021, due to the coronavirus outbreak, has provided an opportunity for HMRC to continue to improve its communications in support of business, and employer and engager readiness for off-payroll working. The forum agenda focussed on looking ahead to what work is needed in the coming months to support the roll out of the reforms from April 2021, such as: • customer support • education for all stakeholder groups (for example: agents, employers, public sector, agencies) • education needs for different sectors • risks of operating non-compliant schemes – what do they look like, and highlighting actions HMRC are taking to protect against their promotion. n If you have views or experiences on any aspect of the off-payroll working reforms, including your experience of using CEST, please contact Samantha Mann, policy and research technical lead to policy@cipp.org.uk .

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