The employer’s contribution for Auto Enrolment will rise to 3% of qualifying earnings from 6th April 2019. The total contribution will rise to 8%, there is no minimum contribution for the employee but their contribution should be sufficient to ensure that the 8% minimum contribution is made.
This is one of the many milestones in the roll out of Auto Enrolment that began in 2012. However, it may cause the most noise owing to the increase that employees will need to make to achieve the 8% minimum contribution. Are you ready and able to handle this?
At Payroll Masters our outsourced payroll management services include HR, which you may need to communicate this change to your staff, and help with the deciphering of the rules around Auto Enrolment. You can tackle this on your own by following this link https://www.thepensionsregulator.gov.uk/en/employers/managing-a-scheme/contributions-and-funding to guidance on The Pensions Regulator’s website or you could ask for our help. If you are unsure how to apply the tax relief method that is best for your staff, or have concerns over any of the other more technical aspects of getting your payroll right, we are here to help. We are based in Birmingham but work with clients and organisations of all sizes the length and breadth of the UK. Please talk to us for outsourced payroll services.
When the National Living Wage was announced employer’s groups were widely reported as saying that this would effect jobs. However, in a report from the Low Pay Commission (LPC) this does not appear to have happened.
The LPC provides recommendations to Government on what the rates of pay for the National Living Wage and National Minimum Wage should be. The LPC produces an annual report and one of the key findings in their 2018 report, was that there was no clear evidence of any negative effects on employment arising from the increase in National Living Wage which came into force in April 2018.
The LPC say that 5 million workers have received higher pay rises owing to the uplift in NLW. This equates to a fifth of workers aged 25 and over. This takes into account a knock-on effect for the bottom 20% of earners, people earning less than £9 per hour. The LPC says that these workers benefitted because employers maintained a gap between pay for different pay-grades or have made the decision to keep their pay levels above the NLW. In total 1.6 million people were paid at or below the NLW. Two thirds of people paid the NLW were women.
The LPC went on to say that employers have adapted in order to meet the increase in the NLW. Measures employers have taken includes making less profit, passing on price increases to customers, restructuring their workforce and narrowing the gaps between pay bands. Other stakeholders were reported as saying that improving productivity will be important in order to manage future cost increases.
New increased levels for National Living Wage and National Minimum Wage will take effect on 1st April 2019. You will need to adjust your payroll management system accordingly. Alternatively, please talk to our team at Payroll Masters based in Birmingham to outsource all your payroll management obligations including the increase in NLW.
An employee on a zero-hours contract can be an agency worker. This is the ruling of the Employment Appeal Tribunal.
The case is Matei v Brooknight Guarding Limited. Matei was employed on a zero-hours contract by Brooknight. He mostly worked for one client, Mitie. The Claimant claimed he was an agency worker and entitled to the same basic working conditions as the Mitie staff after 12 weeks of service.
The Tribunal agreed, but Brooknight appealed. The Employment Appeal Tribunal has upheld the original tribunal’s decision which was on the basis that he had been supplied to work temporarily for Mitie, and worked under their supervision and direction. The EAT said the position was temporary as it was not permanent or indefinite and the original tribunal had adopted the correct approach.
Employment rules and legislation is constantly changing. Keeping on-top of this is onerous for businesses who are focussed on doing what they do, not being payroll experts! What we at Payroll Masters do is payroll. Its as simple as that. Payroll, the rules surrounding pay, salaries, personal taxation, calculating benefits and so on, this is what we do. We can usually show a saving in management time, cost and employee satisfaction when we take over as an outsourced payroll provider. You can contact us and talk to one of our experts about any aspect of payroll or matters related to payroll.
“If HMRC don’t understand their obligations under a system they’ve created, how can they expect businesses to get it right?” Says The Association of Independent Professionals and the Self-Employed (IPSE).
A contractor spent over a year working on marketing projects for HMRC as a freelancer. HMRC changed the terms of her contract, requiring her to go onto an agency payroll, a decision that she could not challenge. She then launched a claim to an Employment Tribunal against HMRC, Kinect Recruitment Ltd and three other parties in the contractual chain for unpaid holiday pay in the sum of £4,200 under the Agency Workers Regulations.
The parties settled the case in full for the full amount being claimed by the freelancer on the morning the tribunal was due to start.
The IPSE went on to say that “You can’t just decide someone is inside IR35, shunt them onto an agency payroll and expect someone further down the line to pick up the tab for your obligations like holiday pay.”
HMRC had run her engagement through the Check Employment Status for Tax (CEST) tool and had come to the conclusion that IR35 was applicable in her case.
The government are currently carrying out a consultation on putting these off-payroll changes into the private sector. Our professional body the Chartered Institute of Payroll Professionals has called on government to delay any changes until the CEST tool is fully tested.
Payroll Masters provides outsourced payroll management to a wide range of clients, including large public sector organisations. Please contact our Birmingham head office for more information.
The Insolvency Service undertook an investigation into Crownsbury Limited finding that company director John Thomas Hanbury failed to ensure the business had adequate accounting records. This included a sum of £520,000 for which they could not determine the reason for this receipt going into Crownsbury’s bank account.
John Hanbury was appointed a director of Crownsbury Limited in January 2016 and the company went on to operate a payroll processing bureau, which it had not done before his appointment. The business went into Administration on 18th July 2016. The Insolvency Service found that he not only failed to keep proper books and records but he also failed to provide adequate accounting records to the Joint Administrators when required to do so. Therefore, the Insolvency Service has been unable to verify what the company’s income and expenditure was after 3rd May 2016 which was when the company bank account was closed.
John Hanbury put forward a ‘Disqualification Undertaking’, which was accepted by the Secretary of State On 7th August 2018. The ban is effective from 28th August 2018 and lasts for 7 years. A person with a disqualification cannot act as a director of a company, nor take part, directly or indirectly in the promotion, formation or management of a company or limited liability partnership or be a receiver of a company’s property.
Outsourcing your payroll function to an expert third party can save significant time and money. However, always take references before you appoint your outsourced payroll provider, take time to find out how long they have been providing payroll services to their clients and get all the information you require to feel sure you have done due diligence before appointing them. At Payroll Masters we will be happy to provide any and all information that you need and would welcome the opportunity to talk to you. Please get in touch with our team at our head office in Birmingham for outsourced payroll services.
Last years’ Conservative Party Conference was held in Payroll Masters’ backyard. Literally a stone’s throw from our head office in Birmingham.
In his conference speech Chancellor, Philip Hammond threatened to unilaterally tax the web giants. He said the Conservatives had led the debate on international tax reform for the digital age. He argued that the tech giants such as Amazon, Google and Facebook should make a fair contribution to paying for public services in all the countries they do business. We agree with this because these massive global tech companies reap the benefits of our educated workforces, health services and transport infrastructure. All of which is paid for through taxation.
Hammond went a step further in his 2018 Autumn Statement. Here he announced plans to introduce a new 2% Digital Services Tax from April 2020. We had been concerned that any tax announcements would affect all businesses that trade on-line, but the Chancellor stressed that this new tax would only be levied on profitable companies that have at least £500m a year in global revenues.
At the Conservative Party Conference, the Chancellor also spoke about reforms to the government’s apprenticeship levy, and he announced that £20m would be invested in a new network to help SMEs to learn new management skills from mentors from the likes of KPMG and Siemens. In our experience at Payroll Masters, if a business wants to apply for apprentices or enrol in government training initiatives there is always an applications process that requires numbers. Often asking for details of number of employees, how many new roles you have created and so on. By outsourcing your payroll function to Payroll Masters all of these figures would be available quickly and accurately. So please don’t let bureaucracy put you off growing your business. To find out more about our payroll services contact our Birmingham head office and we’ll be pleased to help.
There are nine Low Pay Commissioners who make recommendations to the government on National Minimum Wage and National Living Wage rates. Four of the Commissioners recently visited Birmingham for a meeting with businesses and individuals. Following the visit, they posted a blog.
They said that meetings, such as the one in Birmingham, help them to prepare themselves to make their recommendations. Of course, they have access to the best economic data, statistics and evidence sessions with academics, but the real-life experience of real people who are in low paid jobs helps them to stay in touch with what’s working and what needs more attention.
It is now accepted that the National Living Wage has led to the largest fall in numbers of people in low pay for decades, and the National Minimum Wage has all but eliminated extreme low pay. But the Commissioners say there can be no complacency. There are still a lot of improvements to be made, not least of all in the less visible end of the labour market. For example, some MP’s are calling for a licensing scheme for Hand Car Wash Businesses.
The Commissioners also heard complaints from employers who were concerned that HMRC were being heavy handed in investigations and taking benefits away from employees, that the employers say they are entitled to, such as the salary sacrifice scheme. The Commissioners will be discussing this with HMRC.
Calculating pay, especially for people who are on zero hours contracts or short hour contracts with unpredictable shift patterns can be a challenge for the most dedicated in-house payroll clerk. Good employers want to ensure that their staff get the correct salary and benefits, with the least amount of paperwork and certainty that the calculations are correct. Talk to us about outsourcing your payroll to Payroll Masters, our head office is in Birmingham, but we work across the UK.
There isn’t a day that goes by without some new information or process that business needs to know concerning Brexit. At Payroll Masters we are keeping fully up to date with announcements affecting payroll and matters associated with managing the outsourced payroll service we provide to our clients.
If you employ EU citizens, an employer’s tool kit is now available from the Home Office. This is being updated as required. There is also the option to sign up for email alerts
What Employers Need To Know About The EU Settlement Scheme
- EU citizens who want to stay in the UK after 31 December 2020, and their close family, will need to apply to the EU Settlement Scheme
- As an employer you cannot discriminate against EU citizens as a current or prospective employer, now that the UK has decided to leave the EU
- Current right to work checks apply until the end of 2020
- You do not have to pay the cost of the application by your EU employee, but you may at your own discretion
- You do not have to interpret information provided by government
- You must be careful not to provide immigration advice
At Payroll Masters HR issues arise every day as we carry out the outsourced payroll function for our clients in education, the public sector and private businesses. We can answer common questions, but we also have specialist trusted HR partners with whom we work. So, if you have a question regarding payroll or HR issues post Brexit, please give our experts in our Birmingham head office a call or drop us an email.
The Chartered Institute of Personnel & Development’s (CIPD) Wellbeing At Work Survey May 2018, reported that more than 20% of organisations said mental health issues were the primary cause of long-term absence from work.
Acas has launched a new framework to be used alongside their existing guidance, to help employers tackle this issue with more confidence. The goal of the framework is ‘Positive wellbeing and productive workplaces’. The framework has three interlinking elements that need to work together, Employers, Managers and Employees.
For employers it outlines things like, reducing stigma and tackling the causes of workplace stress. For managers it focuses on things like planning work with people in mind and supporting work-life balance. For employees it describes looking after their own wellbeing, engaging with line managers and taking notice of and supporting colleagues.
At Payroll Masters we take mental and physical health issues very seriously. Some of the work we do involves working with people with all kinds of disabilities both physical and mental. We also believe that the service we provide to employers takes the stress and hassle of dealing with payroll issues away from them.
Payroll can be stressful, especially if you are not an expert. There are dual pressures of making sure your people get paid, but also the regulatory and tax side of things that you have to get right! Talk to us about outsourcing your payroll to Payroll Masters. We are based in Birmingham but operate across the UK.
Following a freedom of information request The Pensions Regulator confirmed that it had received 114 allegations of employers persuading employees to opt out of pension schemes. Even if the employee doesn’t opt out this is an offense under section 54 of the Pensions Act 2008.
TPR said that there was no evidence that employers trying to encourage their workers to opt out of pension schemes was widespread. A TPR spokesperson said “Nevertheless, we would encourage any workers who are not being given the pensions they are entitled to or who believe their employers are committing pensions offences to contact us and we will investigate.”
Membership of a workplace pension is a valuable employment right, if the employee meets the criteria. But what is the criteria? If you don’t know it is possible that your employees could report you to The Pensions Regulator. We have reported on this news page in recent months on a number of cases being brought to Court by TPR. Keeping up to date with all the obligations of being an employer and payroll processes is a full-time job, which is 100% what we do. We take the burden of payroll administration and processing away from our clients so get in touch if you would like to know more about how we work.