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Employment Payments Calculation Guide

Learn about statutory payments including sick pay, maternity pay, redundancy pay, and holiday pay calculations. Eligibility criteria and recovery rules are explained to aid employment advisors. Detailed information on process and benefits is provided.

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Employment Payments Calculation Guide

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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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