Policy hub
to be deducted. ● It is inconclusive as to whether an hour would be sufficient time to develop a fact sheet: 50% said yes and the other 50% were unsure. ● All respondents confirmed that they had used an umbrella/intermediary company, but this split 50/50 for a good and bad experience. ● The problems for an agency worker using an umbrella or intermediary company were the lack of clarity on employment issues, lack of transparency and ownership when problems arise. ● When asked about extending the remit of the EAS there was 100% agreement that there needs to be someone in control of legislation and for a point of contact as this would be fairer for all. ● It was agreed that some or most of the legislation around enforcement of the Regulations should come under the remit of the EAS inspectorate. Minimum wage We ran a survey throughout May 2018 to gather views on the Low Pay Commission’s annual review of minimum wage rates for April 2019. The key findings of the survey are as follows: ● 86% of respondents stated that the introduction of the national living wage (NLW) had increased their wage bill to some extent since its introduction in April 2016 ● 100%, however, reported that the NLW had not affected jobs and that they had not been forced to make any workers redundant nor recruit fewer staff ● only 14% stated that they had been forced to reduce staff hours due to the NLW ● 67% have made more use of zero-hours contracts since the introduction of the NLW ● 100% said the NLW has motivated staff, with 50% saying absenteeism and staff turnover has reduced ● 95% say that the NLW has had no impact on benefits packages ● 100% said there has been no impact on the age profile of the workforce ● though 25% believe the expected increase to the NLW in April 2020 will have no effect on their business, 10% believe it will have a big effect ● 25% say they have begun recruiting apprentices as a direct result of the apprenticeship levy and a further 10% are planning on doing so
...difficulties when it comes to HMRC enforcement of the minimum wage... Whilst the introduction of the NLW has affected many businesses, the impact on jobs and worker hours has been minimal. Though our research shows the NLW has had a positive impact on staff morale, there has been a significant increase in the use of zero-hours contracts. Where the number recruiting, or intending to recruit, apprentices following the introduction of the apprenticeship levy has shown a slight increase, there are those who feel that the levy is simply another form of taxation from which they will not benefit. Every year – and this year is no exception – our members tell us that although they pay above minimum rates, they still experience difficulties when it comes to HMRC enforcement of the minimum wage and in understanding government guidance which still appears unclear and difficult to interpret. All our open consultation surveys and formal consultation responses can be found under My CIPP / Policy hub on cipp.org.uk . New Northern Ireland AEO The Enforcement of Fines and Other Penalties Regulations (Northern Ireland) 2018, (‘the 2018 Regulations’), which came into operation on 1 June 2018, are made under provisions of the Justice Act (Northern Ireland) 2016 (‘2016 Act’). The Justice (2016 Act) (Commencement No.2) Order (Northern ● the majority pay their workers more than the minimum rates ● experience of HM Revenue & Customs’ (HMRC’s) minimum wage enforcement is not good ● use of zero-hours or short-hours contracts is not commonplace, with only a quarter stating that they are used to some extent ● 56% of those using flexible employment contracts said that workers tend to work similar hours each week.
Ireland) 2018 (‘the Order’) brings into operation from 1 June 2018 provisions in relation to the collection of fines and other penalties. New enforcement powers include deductions from benefits, attachment of earnings orders (AEOs), bank account orders and vehicle seizure orders. Though the 2018 Regulations mirror the changes in England and Wales that enable recovery of fines from earnings under provisions of the Courts Act 2003, they seem to borrow from direct earnings attachment (DEA) rules rather than using Courts Act 2003 AEO rules for the recovery of fines. Note that though DEA rules specify tables for daily, weekly and monthly rates, the new AEO for Northern Ireland only specifies weekly and monthly. If your payroll software does not (yet) have the functionality to deal with the AEO – which, given the effective date of 1 June, would be unsurprising – using DEA capabilities in your software could cover the requirement. However, you need to understand what your software will do and the implications. Neil Tonks, ChMCIPPdip, commented on this when we posted the item on our LinkedIn group: “Entering these things into the payroll as DEAs might well calculate the correct deduction, but sadly that’s not the whole story. The problem is the rest of the payroll system will treat them as DEAs too, which may be inappropriate. For starters, they may be described on the payslip as being a ‘DEA’, which could confuse the employee. Additionally, you’re required to explain the nature of any deductions on the payslip and describing an AEO to recover a fine as being a DEA (which is not used for that purpose) doesn’t really achieve this, does it? They’ll also be picked up by any reports relating to DEAs, on which they’ll be provides information for the DEA schedule you sometimes have to submit (depending on how you pay the money over), and also on any financial reporting relating to DEAs. If the payroll generates BACS output to pay the DEAs, these new orders may be included there, too, which is not what’s required. Because of these unwanted consequences, payroll systems will have to be amended to treat them separately, but this won’t happen overnight. It would have been good to have had a reasonable amount of time to prepare!” n mixed in with the genuine DEAs. ”This will affect any report which
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| Professional in Payroll, Pensions and Reward |
Issue 42 | July - August 2018
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