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Calculating Employment Payments

Calculating Employment Payments. Bethan Osborne & Lis Moore Employment Advisors. What are Statutory Payments. Statutory Sick Pay (SSP) Statutory Parental Pay (SMP/SPP/SAP) Statutory Redundancy Pay (SRP) Holiday Pay. SSP - eligibility. Must be an employee

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Calculating Employment Payments

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  1. Calculating Employment Payments Bethan Osborne & Lis Moore Employment Advisors

  2. What are Statutory Payments • Statutory Sick Pay (SSP) • Statutory Parental Pay (SMP/SPP/SAP) • Statutory Redundancy Pay (SRP) • Holiday Pay

  3. SSP - eligibility • Must be an employee • Must have earned over the Lower Earnings limit (2014-15 £111 per week) • Must be sick for 4 days or more in a row (PIW) and notified the employer • Not paid for the first 3 days of illness (WD) • May be linked to another PIW • Maximum of 28 weeks

  4. SSP • £87.75 per week (2014-15) • No need to operate SSP if Occupational Scheme (OSP) pays the same or better • Green Book terms more than SSP • Can run SSP & OSP concurrently • If SSP paid > 13% of total NIC for month can reclaim until 6th April 2014 • If PAYE & NIC less than SSP – claim HMRC funding

  5. SMP - eligibility • Must be an employee • Must have earned over the Lower Earnings limit (2014-15 £111 per week) • 26 weeks employment by Qualifying Week (QW) • Give 28 days notice • Provide medical evidence (MATB1)

  6. SMP • QW = 15th week before the due date • 25 weeks pregnant • LOS 26 weeks by QW therefore needs to have worked for you for a week before getting pregnant! • If not eligible can claim Maternity Allowance

  7. SMP • 39 weeks paid vs 52 weeks leave • Other benefits continue to accrue – holidays, SLCC membership, contractual increments • 6 weeks at 90% of pay at QW • 33 weeks at £138.18 (2014-15) • 10 Keep In Touch (KIT) days

  8. SMP & Green Book • Green Book more generous • <1 year of service = SMP only • >1 year of service and returning to work for at least 3 months = 6 weeks at 90% followed by 12 weeks at 50% then SMP for 15 weeks

  9. SAP • Must be an employee • Must have earned over the Lower Earnings limit (2014-15 £111 per week) • 26 weeks employment on Matching Date (MD) • 28 days notice for pay & 7 days notice to take leave • Provide evidence of matching and official notification from local authority

  10. SAP • 39 weeks paid leave vs 52 weeks adoption leave • £138.18 per week or 90% of pay if lower • Available to individuals or one of a couple adopting a child • Other member of couple can claim SPP • Recovery and funding as for SMP • No Green Book enhancements

  11. SPP • 2 types Ordinary & Additional • Applies to births and adoptions • Up to 2 weeks OSPP – must be consecutive • In 8 weeks following birth or from day of placing • Up to 20 weeks ASPP from 20 weeks after birth or placement

  12. SPP - eligibility • Must be an employee • Must have earned over the Lower Earnings Limit (2014-15 £111 per week) • 26 weeks employment at QW or MD • Still employed when ASPP starts • At least 2 weeks SMP or SAP remaining • Partner has returned to work

  13. SPP • £138.18 per week • Recovery and funding rules the same as SMP & SAP • Evidence needed – signed declarations by both parents for ASPP • HMRC pro-formas • Green Book – 5 days Maternity Support Leave

  14. Redundancy • Must be an employee • Must meet the statutory definition of redundancy • Min 2 years completed service • Under 22 half a week’s pay per year • 22-41 a week’s pay per year • Over 41 one and a half week’s pay per year

  15. Redundancy • Tax free up to £30,000 • Capped at £450 per week • Notice pay per contract or statutory notice • Continuous service from another authority • No recovery or funding from HMRC!

  16. Holidays • Statutory entitlement • Min 5.6 weeks paid leave per year or 28 days • Can include bank holidays • Pro – rata for part timers • Green Book 21 days plus bank holidays plus 2 extra statutory days increasing by 5 after 5 years service.

  17. Holidays • Continue to accrue during SMP/SPP/SAP • Continue to accrue during sick leave • Carry forward of entitlement above 4 weeks permitted but should be taken as soon as practical • Usual carry forward not more than 5 days • Untaken leave should be paid on termination of employment

  18. Part Timer Holidays • Convert to hours e.g employee works 10 hours per week and gets statutory minimum leave so multiply hours by 5.6 = 56 hours paid leave including bank holidays. • Green Book more complicated calculation work out full time annual leave in hours (236.8) and then divide by 37 and multiply by hours of work

  19. Part Timer Holidays • For each day of leave deduct normal working hours • If a bank holiday or extra statutory day falls on a working day deduct normal hours • Balance is the hours they can book

  20. How to pro-rata pay? • Hourly Pay - full time equivalent divided by 52 divided by 37 • Specified in Green Book • Then multiply by number of hours e.g £21,734(SCP25) /52/37 = £11.30 per hour times contractual hours 20 per week = £225.93 per week • Monthly value - multiply by 52 divide by 12

  21. Test Your Knowledge • In pairs do the exercise on the sheet • Use a calculator or show your workings

  22. More Information • HMRC guidance on data stick • SLCC Advice Notes • CALC/SLCC Advisory Service • Annual Leave Calculator on website • gov.uk website • HMRC website (includes calculators)

  23. Any Questions?

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