Nov 2020

18

New Real Living Wage Rates Announced

The Living Wage Week took place from 9th to 15th November 2020 and as part of this week the new living wage rates details were announced. The new rates apply to employees aged 18 years of age and older from 9th November 2020, but employers who are already part of this scheme will have six months to apply the new pay rises.

The new London Real Living Wage announced by the Living Wage Foundation, has increased by 10p from £10.75 to £10.85 per hour. This helps reflect the higher cost of living facing families in the city. The UK Living Wage rate has increased by 20p from £9.30 to £9.50, an increase of 2.1%. The Government's current national minimum wage for over 25s is £8.72, which is £78p less than this rate.

It is estimated that over 250,000 employees will be affected by the new real living wage increase. An employee working 37.5 hours per week being paid the new Living Wage rate of £9.50 will earn more than £1,500 more annually compared to an employee on the current national minimum wage for over 25s. And an employee working the same hours per week in London being paid the new Living Wage rate of £10.85 will earn more than £4,000 per year compared to an employee on the national minimum wage for over 25s.

The total number of accredited Living Wage organisations is nearly at 7,000. Over 800 employers have been accredited by the Living Wage Foundation since the start of the Coronavirus pandemic. New companies that have signed up include Capital One, Tate & Lyle and All England Lawn Tennis Club.

An upgrade to BrightPay payroll software has now been released catering for the new Living Wage rates. For information about the Living Wage Foundation visit the Living Wage Foundation website here.

Posted byDebbie ClarkeinPay/Wage


Mar 2020

13

Budget 2020 – An Employer Focus

Chancellor of the Exchequer Rishi Sunak presented Budget 2020 to Parliament on 11th March 2020. The main points to be noted by employers are:

  • The personal tax allowance will remain the same at £12,500 for the new tax year 2020-21.
  • There are no changes to the PAYE tax thresholds from 6th April 2020.
  • The National Insurance threshold will increase by £868, from £8,632 to £9,500 for 2020-21.
  • The Employment Allowance has increased to £4,000 from £3,000 for eligible employers. 
  • From April 2020 the government will restrict the Employment Allowance to employers with an employer National Insurance contributions (NICs) bill below £100,000 in the previous tax year.
  • Employees aged 25 and over will receive the National Living Wage of £8.72 an hour and it was announced that it is planned that the National Living Wage (NLW) will increase by two thirds by 2024 that will equate to £10.50 per hour.
  • In relation to the Coronavirus, as previously announced by the Prime Minister Statutory Sick Pay (SSP) will be paid from the first day of sick leave rather than day four and the government will refund Statutory Sick Pay for 14 days to employers with less than 250 employees. 
  • A temporary Coronavirus Business Interruption Loan Scheme will be available for businesses from the government to help pay employees’ wages and business costs.

Posted byDebbie ClarkeinPay/Wage


Jan 2018

12

2018-19 Rates and Thresholds for Employers

For 2018-19 the new personal allowance for an employee is £11,850.


The 20% PAYE tax threshold is for annual earnings up to £34,500.


The UK higher tax rate of 40% is on annual earnings from £34,501 to £150,000.


The UK additional tax rate is 45% on annual earnings over £150,001.


For the new tax year 2018-19, the Department for Work and Pensions have published the statutory payment rates for benefits and pensions.


Click here to see the full list published.

 

Please see some rates details below:


Posted byDebbie ClarkeinPay/Wage


Jan 2018

5

The UK’s gender pay gap has risen. Here’s how you can help.

The Prime Minister has announced that she is taking action to close the pay gap between male and female employees and ultimately improve workplace equality.

This push being taken by the Prime Minister came after new figures were published. The figures showed that the UK’s overall gender pay gap has risen to 18.4%. Interestingly, the gap for full time workers has fallen from 9.4% in 2016 to 9.1% in 2017.

By law, businesses with 250 plus employees must report the pay gaps and bonus data as a mandatory requirement.

In a bid to seal the gender pay gap The Prime Minister is now asking all companies for their help.

“The gender pay gap isn’t going to close on its own – we all need to be taking sustained action to make sure we address this.”

Here are some of the recommended ways that all businesses can help:

  • Ensure there are female representatives at senior level. This can be achieved by ensuring there are opportunities to progress for females within a company. This can also be achieved by introducing a return to work scheme for women.
  • Publish gender pay gap information. This can prove helpful in closing the gender pay gap if all companies, even those with fewer than 250 employees, publish this information.
  • Make flexible working a reality. This should be advertised with a new position from the start.

 

 

 

Related Articles:

Posted byCailin ReillyinPay/Wage


Dec 2017

18

Minimum Wage Increase on 1st April 2018

The Low Pay Commission’s Autumn 2017 report has been published and on the 1st April 2018, the minimum wage will increase again.


The National Minimum Wage (NMW) is the minimum pay per hour most employees are entitled to by law. An employee's age and if they are an apprentice will determine the rate they will receive.

 

Posted byDebbie ClarkeinPay/Wage


Sep 2017

26

42 Year Low in UK Unemployment

The UK's unemployment rate has fallen to its lowest level since 1975, according to official figures which also show a growing gap between price rises and wage growth. The unemployment rate fell to 4.3% in the three months to July, down from 4.4% in the previous quarter and 4.9% a year earlier.

The employment rate, which measures the proportion of people aged 16- 64 in work, hit 75.3% - the highest since comparable records began in 1971. In total, there are 32.1 million people at work in the UK, according to the figures, or 181,000 more than the previous quarter.

While that performance suggests the labour market is continuing to shrug off uncertainties and other headwinds in the wake of the Brexit vote, the figures also highlighted a worsening squeeze for family budgets. It is also reported that average wage growth remained static at an annual rate of 2.1% over the same three months. With inflation coming in at 2.9%, the real value of wage growth is falling.

Posted byCaoimhe ByrneinEmployment UpdatePay/WageWages


May 2017

29

Hiring An Apprentice:

If you are considering employing an apprentice there are some things you should know:

 

  • An apprentice will be aged 16 or over
  • An apprentice must be paid at least the minimum wage for their age  
  • An apprentice must work with experienced staff, learn job specific skills and study for a work based qualification during the working week
  • An apprentice must work for at least 16 hours per week and will usually work for 30 hours
  • An apprentice must be paid for time spent training or studying
  • An apprentice must be provided with the same conditions as other employees i.e. paid holiday, sick pay and any benefits such as childcare voucher schemes.

 

If you employ an apprentice you may be eligible for an apprenticeship grant of £1,500 if you have less than 50 employees and your apprentice is aged between 16 and 24.  

If you are providing the training you can apply for training funding to cover some or all of the training costs.  Further information is available on the HMRC website.

Employers who have an apprentice will not be required to pay employers National Insurance Contributions (NICs) on their earnings if they are under 25, earning below £45,000 and on an approved UK government apprenticeship.  National Insurance category ‘H’ is to be used for apprentices under 25 in qualifying circumstances.

Posted byCaoimhe ByrneinHMRCNICPay/WageWages


Mar 2016

17

Increase in National Minimum Wage from 1st October 2016

The Low Pay Commission's (LPC) recommendations for the rates of the minimum wage for employees under 25 and apprentices has been accepted by the Government and this take effects from 1st October 2016.

These include:

21-24 year olds £6.95 per hour an increase of 3.7%

Youth Development Rate - 18-20 year olds £5.55 per hour an increase of 4.7%

16-17 Year Old Rate £4.00 per hour

Apprentice Rate £3.40 per hour an increase of 3%

The Government has introduced the National Living Wage of £7.20 per hour for employees over 25 which takes effect on 1st April 2016.

Posted byDebbie ClarkeinPay/WagePayrollPayroll Software


Nov 2014

9

New 2015 Living Wage Rate announced

The UK "living wage" - an hourly rate based on the amount needed to cover the basic costs of living - has been raised by 20p to £7.85, whilst The London Living Wage has been raised from 8.80 an hour to £9.15.

What is the difference between the Living wage and the national minimum wage?
The living wage is an informal benchmark, not a legally enforceable minimum level of pay line the national minimum wage. The national minimum wage is set by the business secretary each year on the advice of the Low Pay Commission. Unlike the living wage, the national minimum wage is enforced by HM Revenue and Customs (HMRC).

The basic idea of the living wage is that these are minimum pay rates needed to let workers lead a decent life.

Does this effect employers?

The living wage is a voluntary wage so employers are not legally obliged to pay it. Nevertheless, it has been adopted by more than 1,000 employers across the country benefitting 25,000 workers. Citizens UK, the community behind the living wage project say that the number of companies paying the rate has doubled in the last year. However, some business groups are not happy with the increase saying some employers might struggle to pay it.

The advice to employers should be to seriously consider the living wage, but only implement it if it is affordable.

Bright Contracts – Employment Contracts and Handbooks.
BrightPay – Payroll & Auto Enrolment Software.

Posted byLaura MurphyinPay/WagePayrollPayroll Software


Jun 2014

4

Changes to Holiday Pay Calculations

As we enter the summer holiday season employers need to ensure that they are paying their employees correctly during annual leave.

A recent decision by the European Court of Justice (ECJ) will impact how some annual leave pay is calculated.
Do you pay employee’s commission? Is the commission calculated based on the amount of sales made or actual work carried out? If yes, according to the ECJ, holiday pay should include commission pay.

The decision was made in the case of Locke v British Gas Trading and Others. Locke was a Sales Representative whose commission made up approximately 60% of his remuneration. After taking two weeks leave in 2011, Locke suffered financially as he was unable to generate sales for the period he was on annual leave.

The ECJ ruled that the purpose of annual leave is to allow a worker to enjoy a period of rest and relaxation with sufficient pay. By not including commission payments with holiday pay, employees are less likely to take annual leave so as to avoid financial hardship.

It has been left to the national courts to determine how to calculate the commission to which a worker is entitled, however the court did suggest that taking an average amount of commission earned over a certain period, e.g. the previous 12 months.

Employers are advised to review their commission policies to establish which, if any, payments need to be included in annual leave pay.

BrightPay - Payroll Software

Bright Contracts - Employment Contracts and Handbooks

Posted byLaura MurphyinAnnual LeaveContract of employmentEmployment UpdatePay/Wage