Legal Update
Deductions from pay Employers should understand the legalities of pay deductions, says Lewina Farrell, REC solicitor and head of professional services All workers (including employees and temporary workers on contracts for services, but not the genuinely selfemployed) are entitled to the applicable national minimum wage (NMW). This varies according to age; the current adult rate is £6.31 rising to £6.50 from 1 October 2014. Workers must be paid at least this hourly rate, for all hours worked before deductions are made. Section 13 of the Employment Rights Act 1996 states that an employer (including employment businesses supplying temporary workers on contracts for services) may not make any deduction from wages unless it is authorised by one of the following: 1) by statute 2) by the worker’s contract 3) the worker has previously signified in writing his consent to the making of the deductions. However, the National Minimum Wage Regulations 1999 outline specific situations where deductions can be made to bring the hourly rate below the NMW, including deductions in respect of: a. tax and National Insurance b. a worker’s conduct, where the worker is contractually liable c. repayment of a loan or advance or wages d. repayment of an accidental overpayment of wages made to the worker
e. the purchase by the worker of any shares, securities, share options or of any share of a partnership f. the provision of living accommodation (ie. the accommodation offset, which is currently £4.82 per day) g. deductions that are not for the employer’s own use or benefit (eg. union subscriptions or pension contributions). The REC Legal Helpline receives lots of questions about pay and deductions, including about Personal Protective Equipment, fines and damage to vehicles. • PPE: You cannot charge workers for PPE or for failing to return PPE. However, you can have a contractual clause whereby you will provide PPE free of charge
and without deposit, but if they do not return the PPE, either at all or in a usable state (allowing for reasonable wear and tear), you will recover the cost of replacement PPE by charging an agreed amount. This deduction is allowed even if it takes the worker below the NMW because a deduction in respect of a worker’s conduct, where the worker is contractually liable will not breach the NMW legislation (see point b] above). • Driving fines or congestion charge: You can only deduct driving fines or the congestion charge if you have the driver’s prior written consent to do so or a contractual clause allowing you to. However, can you question whether the driver could have avoided the fine or charge eg. was the delivery scheduled by the client during congestion charge hours or the hours during which parking was restricted? If not, agree with the client how it will cover these costs rather than deduct from the driver’s pay. • Damage to vehicles: before deducting any sums for damage to a client’s vehicle, a full investigation should be done on what the damage was and how it was caused. The driver may or may not have been responsible for the damage, if an accident; it might have been caused by a third party. REC corporate members can call the REC Helpline on 020 7009 2199 or email us at legal@rec.uk.com.
Business development: read all about it What if you could get newspaper coverage across the country along with jobsites as part of your recruitment process? Well, you can. Fish4Jobs has 2.5 million registered candidates but it also is part of the Trinity Mirror Group, which has more than 100 publications across the country, including the Daily Mirror and plenty of regionals such as the Manchester Evening News, the Liverpool Echo and the Birmingham Mail. Fish4Jobs has also recently become an REC business partner and is offering REC members an exclusive 15% off new
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advertising campaigns on its online and print recruitment platforms. Charlotte Tracy, head of marketing at Fish4Jobs, says: “I think what makes us different is the regional coverage we have and the network of local jobsites We can access active jobseekers through the jobsites, but then we can also target passive jobseekers through the papers.” For more information about the unique offer and to get in contact with Fish4Jobs, contact Jimmy Jobson, head of sales, on 020 7845 0102 or email jimmyjobson@trinitymirror.com.
www.rec.uk.com 03/06/2014 11:06