The new payroll year begins on 6 April 2019 – There are several important regulatory changes taking place in early 2019 that will have lasting impacts on employer payroll.
Here’s a quick guide to any changes you might need to make to stay compliant.
If you require further support or advice Contact Fairmile here to find out more about our competitively priced, fixed fee payroll services.
Minimum and Living Wage Increases
Every April the minimum and living wages increase – Employers need to ensure their employees are receiving at least the minimum hourly rate for their age.
The National Minimum Wage is the minimum pay per hour to which most workers aged 16 to 24 are entitled. The minimum wage for workers 25 and over is called the National Living Wage.
The hourly minimum wage a worker is entitled to is dependent on their age and whether they are an apprentice.
Employees aged 25 and over must be paid at least the National Living Wage whilst employees aged under 25 must receive at least the National Minimum Wage.
It’s a criminal offence not to pay your employees the National Living Wage or National Minimum Wage, so check the table below to ensure you’re on the right track…
Rates as of April 2019
Apprentices can be paid the apprentice rate if they are aged under 19 or if they are 19 and over and in the first year of their apprenticeship. An apprentice aged over 19 and has completed their first year of apprenticeship is entitled to the minimum wage rate for their age.
If you provide your employee with accommodation you can charge them the offset accommodation rate of £7.55 per day for 2019/20. If you charge them more than this amount for their accommodation and only pay them the Minimum Wage rate for their age you will be paying them less than they must be paid.
Minimum Workplace Pension Contribution Increases
The minimum amount paid into your workplace pension, both by employers and employees is increasing. Changes will take place in April 2019 – It’s the law.
Employers who have already chosen to contribute more than the new minimum contribution of 3% do not need to take any action.
Employers who fail to increase to the new minimum of 3%, are late or non-compliant, will be subject to fines, penalties and even prosecution by The Pension Regulator. If you fall into this category, don’t delay any longer – Contact The Pension Regulator and let them help you get back on track.
From 6 April 2019, new legislation – The Employment Rights Act 1996 (Itemised Pay Statement)
(Amendment) (No.2) Order 2018 – will change how UK employers provide payslips.
Employers will have to deliver itemised payslips to every worker on their payroll, not just those classified as ‘employees’. Current legislation does not require payslips to be issued to contractors, freelancers, and other types of ‘non-employee’ workers.
‘Time Worked’ Amendment
This legislation also changes the information which must be included on the payslip. UK payslips must, under current provisions, detail:
● The employee’s gross salary/wages,
● Deductions (tax, NI, etc)
● Net salary/wage amount received.
Under the new legislation, from 6 April 2019, payslips will also have to include information about the number of paid hours the employee has worked – but only in situations where “the amount of wages or salary varies by reference to time worked”. In these variable contexts, payslips will have to show hours worked either as:
● A single, combined amount, or
● An itemised list of hours worked for different rates of pay
This means variable-time employees will not only find it easier to reconcile their pay with their work hours, but to establish whether they are being paid the national minimum wage by their employers. As the current payroll year draws to a close, it’s worth checking employees payslip details are correct –
Check names / addresses (either of which may have changed during the year) and National Insurance numbers.
Changes to information can then be submitted to HMRC as part of the final submission for the yearand will ensure their P60 information is correct.
Fairmile Can Help… .
The coming year will present challenges to effectively manage payroll in the UK. If you’re struggling to maintain compliance, or need support, we can help. Contact us here to find out more about our competitively priced, fixed fee payroll services.