If you hire any staff, and you issue them with a payslip, you might want to familiarise yourself with an important update in legislation, effective from April 2019.
Back in February, the Employment Rights Act 1996 (Itemised Pay Statement) (Amendment) Order 2018 was introduced in law. It sounds verbose, but in short, the Order will change the content of a payslip and require employers to include the number of hours worked.
The law specifically applies to employees who work varied hours, as it provides transparency for both employees and employers. However, the Order will also amend Section 8 of the Employment Rights Act 1996. It will mean employees will now have a right to know exactly how many hours they have been paid for and the amount they have been paid. It will enable workers to enforce their right in law to an itemised payslip, whereas at the moment, it is not compulsory.
The idea is to assist individuals in understanding their pay, but it also allows employers to be more precise, particularly where the number of hours worked is varied.
What do employers need to do?
If you aren’t already doing so, employers must prepare to itemise all payslips for any employees who work varied hours. Employers need to ensure payroll procedures are adjusted to collect the new information required and amend payslips appropriately. The payslip must show the combined number of hours worked, or the hours must be itemised.
The only exclusions are to those who are not entitled to a payslip by law, such as contractors or freelancers, in the police service or a merchant seaman.
If you would like further advice relating to payroll, or itemising payslips for staff, contact our payroll team.