Back in February 2018, a new statute was put before Parliament: The Employment Rights Act 1996 (Itemised Pay Statement) (Amendment) Order 2018.
This new amendment which comes into force on 6th April 2019 requires Employers to itemise employees earnings which vary depending on the amount of time the employee worked.
So how does it affect your business or your clients?
If any employees work variable hours each pay period the payslip must reflect the breakdown of the employees earning detailing the rate and number of hours worked.
This change to legislation has been introduced to increase transparency between companies and their staff.
For many companies, this change in legislation will require no extra work as they already understand the importance of clearly communicating how an employees pay has been calculated. This level of detail ensures that employees can double check their payslips and easily give them peace of mind that their pay is accurate.
Without this level of detail, it can be very difficult for employees to back-calculate pay accurately when multiple factors are involved. This can lead to difficult conversations that can question a business or managers integrity. Simply providing employees with this level of detail can only lead to one thing, better employee/employer relations.
We would suggest reviewing the payrolls processed and start to make changes in January ready for the start of the new tax year.
Follow the link for guidance on the new changes to legislation briefly outlined above: https://www.gov.uk/government/publications/payslip-policy-a-guide-to-the-2019-legislation
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