Employers must comply with new payslip rules

Under the Government’s Good Work Plan, more than 300,000 workers have received a payslip for the first time under new rules that came into force in April.

However, experts fear that many employers may be unaware of the recent changes and how it could affect them.

The new rules require employers to include variable rates of pay and hours worked within their payroll reporting, which will enable workers to easily confirm that they are receiving the minimum wage.

Thought to primarily affect those employees on zero-hours contracts or who perform what has been described as ‘casual’ roles within a business, the Department for Business, Energy and Industrial Strategy (BEIS) have said that itemising and clearly identifying hours worked would ensure that staff could check that they are being paid at the correct rate.

The new rules will also help the Government to more easily identify where employers are failing to meet their national minimum wage (NMW) and national living wage (NLW) obligations, as well as their contributions to workplace pensions and holiday entitlement.

In recent years, the BEIS and HM Revenue & Customs have been taking a tougher approach to those who fail to meet payroll rules, often imposing penalties and naming and shaming the worst offenders.

Alongside the new payslip requirements, the rules change will also see to the scrapping of the Swedish Derogation. This is a legal loophole that allows some companies to pay contractors and agency staff less than permanent employees.

All employees will also be given the ability to request a statement of rights on the first day of their employment, which sets out their annual leave pay and allowance.

Link: Good Work Plan

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