HR and finance teams in companies across the UK need to prepare for the Employment Rights Act 1996 (Itemised Pay Statement) (Amendment) Order 2018 (SI 2018/147) which is going to come into effect next month.

 

What is this new legislation about?

This was an amendment to the Employment Rights Act 1996 brought before the Parliament on 8th February 2018, the rationale behind this statue was that where an employee’s pay varies by reference to time worked, employers must include the number of hours for which the employee is being paid on his or her itemised pay statement.

The New legislation comes into force from April 2019 and requires all employers to:

  • Provide payslips to all workers
  • Show hours on payslips where the pay varies by the amount of time worked

This change was made to make it easier for employees to read their payslips, ensure that they are paid correctly and to make it easier to resolve any under or overpayments to an employee’s pay. This law applies to all types of workers including permanent, casual and zero hours employees.

These changes to the law will commence from 6th April 2019 and all employers should ensure that employee payslips created after this date show details of the number of hours correctly.

 

What to check before 6th April 2019?

We recommend that employers check that any employee payments and deductions influenced by hours, show these hours correctly on the employee’s payslips. To help with this transition we suggest the following:

  • Review all processes regarding the collection and processing of employee hours to ensure compliance
  • Check that hours are being recorded and processed correctly in Accord for payments or deductions
  • Check that hours are correctly being shown on the employee payslip

 

What can Payroll Business Solutions do to help you?

If you are using our Accord Payroll Solution, to help you review your current payroll processes and how they are applied within Accord, we have provided the following Accord resources:

  1. Reports to help identify Accord Wage Types that have been used for hours x rate payments and deductions.
  2. Standard payslip resources to help ensure that employee hours are correctly shown, If you are a hosted client then these resources will be automatically available in your Accord system.

We have already sent out detailed instructions to all our clients on the available resources and guidance on this, if you have not received these or you need any help or support regarding this, please feel free to contact us on support@payrollbs.co.uk