PAYROLL news
National living wage (NLW) to increase to at least £11 from April 2024 THE PRIME minister, Rishi Sunak and the chancellor of the Exchequer, Jeremy Hunt, announced in October 2023 that the NLW will increase to at least £11 an hour, from April 2024. At the time of writing, the Low Pay Commission (LPC) hadn’t confirmed its recommendations on minimum wage rates for the next year. The NLW currently sits at £10.42 per hour and is the minimum wage those aged 23 and over must be paid. The announcement confirmed that whatever the LPC recommends, the NLW will rise to a minimum of £11 an hour. Rishi Sunak said: ‘‘For a full-time worker on the NLW, this boost is worth over £1,000 more next year. It’ll mean that the wages of the lowest paid people in society are over £9,000 a year higher than they were in 2010.” The full news story can be accessed here: https://ow.ly/ lhpw50PX2NT.
Employer Bulletin – October 2023 HER MAJESTY’S Revenue and Customs (HMRC) has released the latest issue of the Employer Bulletin . The CIPP advises all payroll professionals to read the bimonthly publication in full, as it provides a comprehensive round-up of all announcements made that will impact the work payroll teams carry out. This issue includes updates on, but not limited to: l electric charging of company cars and vans at residential properties l paying your pay as you earn (PAYE) settlement agreement (PSA) l reporting PAYE information in real time when payments are made early at Christmas l overlap relief – preparing for the new tax year basis l ‘pay by bank account’ enhancements. You can read the October Employer Bulletin in full, here: https://ow.ly/6qJO50PX3rY.
The latest Supreme Court (SC) holiday pay ruling ON 4 OCTOBER 2023, the SC issued a judgment in the Chief Constable of the Police Service of Northern Ireland and another v Agnew and others (Northern Ireland) case. This can be read here: https://ow.ly/PQ9450PX3fo.
The key part of the judgment relates to the three-month series rules when backdating unlawful deductions from wages. The case of Fulton v Bear Scotland previously established that a gap of three months would break a series and therefore anything further back than that would be out of time to claim. The SC has now ruled that where underpayments can be linked by a common fault this would not necessarily bring the series to an end. The press summary (https://ow.ly/Re9650PX3k0), explained: “A series does not require a contiguous sequence of deductions and a gap of more than three months between deductions does not necessarily bring a series to an end. A correct payment of holiday pay does not break a series if that correct payment was calculated by reference to basic pay.” In this case, as the payments for holiday had only used basic hours, and the processing method was the same in each payment, even for occasions where more than three months had passed, these can be seen as linked. Additionally, a lawful payment in between a series of unlawful ones would not bring a series to an end if the underlying issue were still present. This could happen where a payment has correctly used only basic pay to calculate as no overtime was done in the reference period, but a second, following payment reference period should have included an element of overtime. In this example the error is still consistent, despite one occasion where the method coincidentally resulted in a correct outcome; the series is therefore linked. The case as seen here relates to Northern Ireland, where there is no backstop for backdating claims. In the rest of the UK there is a two- year backstop; still, this could represent a very large liability for many businesses that may have been operating non-compliant holiday pay calculations. Coupled with the recent Harpur Trust v Brazel case, many businesses would be best to review their situations and assess the risk to the business of backdated claims that could not stretch further than where a three-month break would break a series.
Diary dates
5 November 6 November 19 November (this is a weekend date)
Last day of tax month 7 First day of tax month 8
Last day for submitting a real time information employer payment summary to apply to tax month 7 Deadline for payment of PAYE and NICs etc to HMRC’s Accounts Office by non-electronic method Deadline for payment of PAYE and NICs under a PAYE Settlement Agreement (PSA) by non-electronic method
Deadline for payment of PAYE and NICs etc to HMRC’s Accounts Office by electronic method Deadline for payment of PAYE and NICs under a PSA by electronic method
22 November
5 December 6 December
Last day of tax month 8 First day of tax month 9
| Professional in Payroll, Pensions and Reward | November 2023 | Issue 95 8
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