01527 306135
Free must have 55 Essentials Every Early Years Employer Should Have In Place   Click Here

Background

The government has introduced some changes to the legal requirements of the trusty payslip and these changes came into force on 6th April 2019. Payslips can be confusing enough at the best of times and can lead to misinterpretation and misunderstanding which can result in negativity. No one likes to think that their payslip is wrong or that their pay has been calculated incorrectly.

Ensuring that payslips are clear and concise regardless of the legislation is good practice and can avoid lots of awkward and unneeded questions.

The Changes

There are 2 main changes required under the new regulations:

1) All workers have the statutory right to receive an itemised payslip. Before April 2019 it was only employees who had this right.

2) The second change is more complex. If a someone’s pay varies due to the number of hours worked, then you need to show on the payslip the number of hours worked, i.e. their pay varies by time worked.

It must also be clear which pay period these hours were worked.

A payslip must be provided in either a hard copy (paper format) or electronic copy which can be printed if needed.

Person A

If someone is salaried, they work set hours every week, and their hours do not vary then you do not need to show the number of hours worked.

If the person above is then off sick or goes on unpaid leave, their pay will reduce. You do not need to record on their payslip the hours worked, because it is caused by them not working their contracted hours.

Person B
If someone is salaried and their hours set but must work overtime when the work load fluctuates then you would have to record on the payslip the additional hours worked. You would not need to show the standard hours.

Person C

If someone is paid for their age group for each hour they work, then they are paid depending on the number of hours worked. All their hours must be recorded on the payslip.

If the person above is then off sick or goes on unpaid leave, their pay will reduce. You still need to record on their payslip the hours worked for the rest of that pay period, because they are paid for each hour worked.

Person D

If someone works term time only, but paid equally over 12 months, then you do not need to record the hours on the payslip.

Person E

If someone is paid by the hour but gets additional pay for unsociable hours then all the hours need to be recorded. For instance they work 25 hours in a week, 17 hours are at basic rate, and 8 hours were a bank holiday. This is because it is paid on the amount of hours worked. With this situation, the hours can be totalled together – so 25 hours, or as there are different pay rates to them they can be split – 17 hours basic, 8 hours double.

What happens if it goes wrong?

As this is new legislation, there are no cases to refer to, however if someone thinks they have been denied a payslip with the correct information on it then they may be able to bring a claim to an Employment Tribunal.

What can we do to make sure we are compliant?

We recommend you discuss your payroll requirements with your current payroll provider and ask what more information they need from you monthly in order for you to comply with the requirements for your staff.