Showing posts with label HR. Show all posts
Showing posts with label HR. Show all posts

Friday, February 23, 2024

Holiday changes for Zero Hour Employees in April

In April 2024, significant changes to the holiday entitlement for zero hour and other irregular hours staff are set to take effect, altering the landscape of holiday pay and accrual for these workers. These changes, which amend the Working Time Regulations 1998, represent a departure from previous practices and aim to simplify the process for both employers and employees.

You first need to confirm that your zero hours employees fall within the definition of irregular hours or part year workers. Irregular hours are those workers whose paid hours set out in their contract vary in each pay period; a zero hours contract would meet this definition as there is no guarantee of hours to be given each week. Part-year workers are those who are contractually only required to work for part of the year and for the remainder neither work nor receive pay. For example, a term time worker who only gets paid whilst their working would meet this definition.

The second thing you need to confirm is when the holiday year runs from and to. The changes being brought in on 1 April 2024 will apply to all holiday years starting on or after that date. So, if you have a  holiday year that runs April to March, the changes will apply immediately. If however you have a different holiday year, such as a calendar year (January – December), then the changes won’t need to apply until January 2025.

What's New? 

The most notable change is the introduction of a new method for calculating holiday entitlement for part-year and irregular hours workers, which will be based on a percentage of the hours worked. Starting from April 1, 2024, holiday entitlement for these workers will accrue at a rate of 12.07% of the hours worked during the pay period. 

Additionally, employers will have the option to choose between two methods for paying holiday pay to these workers: 
  1. Holiday Accrual: Holiday can be booked as usual and paid when it is taken. 
  2. Holiday Pay: Alternatively, holiday pay can be rolled up with the normal pay, meaning an additional amount is included within every payslip to cover a worker’s holiday pay. 
This second option, known as "rolled-up" holiday pay, is a significant shift from the traditional method and is designed to simplify the process for employers who find it challenging to determine when a zero hour worker is actually on leave. 

Friday, March 2, 2018

Changes for termination payments coming in April

Here are some notable changes when it comes to termination payments:

Foreign service relief termination payments

The Government has decided that taxpayers who have worked abroad but are resident in the UK in the tax year in which their employment is terminated should be subject to exactly the same rules as taxpayers who have not been abroad. Clients will benefit from the existing £30,000 exemption only. The only exception to this change is if you are a seafarer.

In the past, employees who received termination payments and who had spent all or a large part of their employment overseas have been eligible to qualify for what is known as ‘foreign service relief’. This could potentially give them income tax relief of an amount greater than the standard £30,000 deduction. In some cases, the payment would be completely exempt from income tax.

The measure will apply to those who have their employment contract terminated on or after 6 April 2018. If the payment is received from 14 September 2017 onwards in advance of the termination of the employment, the restriction will also apply.

More restrictive PILON classification

The income associated with a contractual notice period that is not worked will no longer benefit from the £30,000 termination payment exemption. To further confuse matters HMRC are now referring to PILONs (Pay in Lieu of Notice) as ‘PENPs’(Post-employment Notice Pay) which represents the amount of pay, and/or benefits, that the employee will not receive because their employment was terminated without full, or proper notice being given.

Thursday, December 13, 2012

Increased rates for maternity and sick pay

From 8th April 2013 new proposed rates of statutory maternity, paternity, additional paternity, adoption and sick pay have been announced.

They are subject to parliamentary approval but changes are unlikely. They are as follows:
  • Statutory maternity, paternity, additional paternity and adoption pay will all increase to £136.78 per week (from the current rate of £135.45)
  • The maternity allowance prescribed rate will also increase to £136.78 (from £135.45) per week
  • Statutory sick pay will increase to £86.70 per week (from the current rate of £85.85)
  • The weekly lower earnings limit applying to National Insurance contributions (below which employees are not entitled to statutory sick pay, statutory maternity pay, statutory adoption pay or statutory paternity pay, but remain entitled to maternity allowance) will increase to £109 (from the current rate of £107)