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Because we only work 39 weeks of the year but are paid 43 with additional holiday pay, until recently we were paid pro rata over 52 weeks of the year. PSLA came in and said that this was against the law and we couldn't be paid this way anymore and had to be paid on our hourly basis. Having a couple of members of staff who rely on their wages heavily each week this past few months have been a nightmare for them as for the summer holiday period they had no money coming in.

 

However I have since found out that we could be paid 39 weeks pro rata of the year with holiday pay paid in full say 1 week xmas, 1 week easter and 2 weeks in summer.

 

Has anybody else had any dealings with this and how are you paid?

 

thanks

Debbie

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We are paid the same 42 weeks per year split over 12 months We work out hourly rate x hours worked then x 42 then divide by 12 and this is what we get paid every month. It works out slightly less than you would get if you were paid term time only but as you don,t get a 6 week break on your mortgage we all think its a good idea and all opted for this method of payment.

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sorry should have said 42 weeks divided by 12 months applies to those on permanent contract. the rest get their hourly rate X the hours for that month plus 10.2 % holiday pay on all the hours they've done that month. it's done through a book keeper so I assume she knows what she's doing...

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we pay pre-school staff (term time only) 42 weeks (38 weeks plus 4 weeks holiday pay) monthly ie divided by 12, you are still employed all year unless you terminate your contract every July. Teachers get paid every month dont they?

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I think the best place would be to check on the Inland Revenue website or give the employers hotline a ring.

 

I pay the staff over 38 weeks - with three holiday payments at the end of each term. Have tried to pay ove 52 weeks but it hurt my brain too much!

 

Maz

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Since when was it not legal? I've done it this way for years - only had one argument with the local job centre who insisted I wasn't paying NMW (nerds) staff prefer it, surely it's up to us and if everyone wants this, then that's how we do it

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we do as you do and state in December, Easter and summer that this includes 1 weeks (or however much)holiday pay on the payslip.. don't know if this is legal but as you staff need regular income they can rely on each month.. and having virtually nil in august is not possible we would lose all our staff if we could not pay this way.

 

We have considered paying weekly by dividing the total annual wage by 48 weeks and then paying holiday pay in set weeks...this would solve the problem..

 

it is all to do with not being allowed to include holiday pay in regular wages it HAS to be paid at time holiday is taken.

 

Inge

Edited by Inge
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i don't know if this will make sense but,,,

 

we work out the hourly rate X hours per week X 38 divided by 12 and show that on payslip as basic pay then under it we work out

hourly rate x hours per week x 4 divided by 12 and show that as holiday pay

it is then clear what proportion of pay is holiday pay this method is fully explained in the staff handbook and our accounts are audited independently every year, the accountant is happy with this method

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I think the reason you might have been advised this way is that it is not legal to "roll up holiday pay". Now I read this on various websites such as Inland revenue, but as I didn't want to have to change what we do I never investigated what it meant properly. Your post sheds some light on this for me. This would explain why you have found out you can be paid for your hours over the year but would need to have holiday pay paid separately.

 

For the record, myself (deputy) and manager are paid int he way you describe. All other staff are paid for hours worked in a onth and 1 weeks holiday pay at both Christmas and Easter and 2 weeks at summer. We don't pay them across the whole year as in the past staff have taken the mickey and taken a lot of time off sick, which would be unpaid, and taken home their full wage anyway.

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I used to do the pro rata pay with holiday paid summer, christmas and easter. I was audited by the I.R. by a NMW inspector and she was happy with this method.

 

I used to do the pro rata including holiday pay but it got too complicated if someone left mid year. Even with holiday pay paid at set times and just the worked weeks calculated pro rata if someone left say in January with the pay year starting in septemebr, I would still have to calculate how much they would have earnt on an hourly basis to the leaving date, how much they had actually been paid over the 4 months and adjust the leaving pay accordingly.

 

Peggy

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So are you saying that it is ok to pay over 12 months eg hours worked per week x however many weeks you are open then divided by 12 AS long as on your wage slips it states how many weeks holiday is included e.g Augusts would have 4 weeks holiday pay added to it?

 

But it is not legal to: have weeks worked over the year plus holiday pay e.g 38 weeks worked + 4 weeks holiday pay = 42 weeks then divide total by 12? Which is what we currently do holiday pay isn't on our wage slops but is stated on our contracts, so if this is wrong then come next April. I'm going to have to change the whole thing

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Yes I think it is exactly as you say holly35.

 

I am going to put it to my committee that we now get paid over 52 weeks of the year EXCLUDING holiday pay - this will be paid 1 x wk christmas, 1 x wk easter and 2 x wk summer.

 

At the moment we are paid by cheque every week, but these are taking up to 5 days to clear in certain banks. Does anybody have theirs paid directly into their bank accounts?

 

thanks for all your comments, really appreciate it

 

debbie

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we pay ours by bacs straight into bank if i remember rightly it was a bit of a nightmare to set up......but what isn't with lloyds tsb but its so simple every month one phne call and tada all done

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we're lloyds tsb too and it was dead easy - i do it online, i just needed my staff bank details and i input their salary amount each month and the taxman and click 'send' and - job done

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Trouble is the two signatures are a safeguard against someone using the account illegally and taking funds to which they are not entitled..

i personally would not like the responsibility of being able to access accounts without 'back- up' for the money being spent.. or the chance of being accused of fraud etc if funds went missing and i was the only one doing the accounts/ wages ..

for a business or private run group this may be Ok as you are owner , but for a charity with trustees, particularly committee changes so often I would worry about the opportunity this offers, and internet banking is one area which could be a opportunity for some..

 

As it is our bank denies our treasurer exists and keep giving her hassle as they say she has not done relevant paperwork.. the fact that she has been doing the job for 4 years now.. all post sent to her with her name on it to her home address.. and she has been in and out of the bank all this time.. completed paperwork every year and taken new committee in every year for change of bank mandate.....

 

Inge

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We are a committee run group but fortunate enough to have a long standing chair who everyone voted should take responsibility to have access to online banking. Although this was a leap of faith on their part it has been very helpful.The treasurer works out the wages and the chair pays them by online BACS. It means we can be paid much quicker and the wages adjusted each month if needed. We also have large expense claims this way such as the First Aid course I had to pay for on my account for three staff this week (£255!!!!).

 

Suppose I should let the committee know that we need to re calculate our wages now in the light of the discussion here.... :o

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we don't do online banking for the very reason stated it would be too easy for someone to access funds and a double signature on a check is a safeguard against that, however for the bacs payments the wages are worked out and a list of payments made against staff i.d numbers, the the bank send a form showing the payments made which are checked for accuracy against the original by a second person,

i would hate to have to go back to being paid by cheque but i am now going to look into the whole holiday pay system because we do split ours over the year

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Ours are paid into the bank each month with any differneces such as overtime being paid by cheque. Problem is with this system is as it is standing order it comes out of our account on 5th of each month and can take as long as 10th/11th to reach some accounts. We also cannot deduct any amounts without the hassle of changing the SO.

Obviously we are now goingt o have to review our whole wages system now anyway, does any one know how much the banks charge for BACS? that's what has put me off before as they charge per payment. I have seriously considered online banking (I do all my banking online) for the wages as I can now transfer money from my account (lloydstsb) to my daughters (HSBC) on a Sat afternoon and two hours later it's showing up in her acount. But what puts me off is that really it would have to be me doing it. a) Would worry that I may forgetb) not sure if CC would allow it c) Sont really want the extra responsibility,but dont really want a treasuuer doing it either, given how transient they can be.

Sorry, I'm boring you all waffling away hear but am just thinking aloud really. Isn't it ridiculous this situation, who else is employed by people who change every year and have no idea of not only the job spec but the practical aspects as well- how ever well meaning they are.

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I know just how you feel - however, as far as wages are concerned I am looking at a couple of companies who work out all the hard bits and one that pays the wages too using bacs, so that I can have a treasurer who just does the basic ins and outs!

 

My last treasurer was a great cause for concern - highly educated, yet estimated one staff members tax last month and made changes to documents & even tried to re-write the policy on admitting children etc etc! However, we are still in the process of looking at these companies to work out the wages as my committee are all desperate to leave and aren't speaking to me anymore (and I do understand how they feel as I work with 3 year old's every day).

 

Moan, moan, whinge, grumble, aaargh!!! :o

 

:(:(:(xD

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Regarding the bank charges for BACS payments - we don't have any. We bank with the Girobank/Alliance and Leicester on a commercial bank account especially for charity/community groups and pay no bank charges for anything. It is much quicker and easier than SOs or cheques and from the treasurer's point of view you always now that the money has gone out and you are not waiting for cheques to be banked.

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Are there any pre-schools out there that are still paid hourly rate.

 

I approached my committee about having hours pro rata again, they were not happy to say the least, they told me that it was not my decision and it had to go to the committee (which I fully appreciate) and we could forget about any pay rises, we would need to employ an administrator, find a new chair and treasurer because they wouldn't do it, the pre-school would probably close.

 

She finally finished by saying that she didn't appreciate the way I had approached her and I need to make an appointment with her to discuss such things!

 

I appreciate that when we were paid like this before (including holiday) we did very nearly close down, however this was because it wasn't done properly.

 

Treading on egg shells and will try and make an appointment with her soon

 

Thanks for all your comments

Debbie

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All staff other than myself (deputy) and manager are paid hourly and only for time worked. I would be very careful about paying staff pro rata because of being burnt by staff in the past. We did it to help them out in personal circumstances but they were not committed to us and basically took us to the cleaners by taking time off sick and bragging about being paid for doing so. I can understand why your committee may be cautious but that said I am so glad I have the relationship with my committee I do when I hear about other people's! They should not be making you feel this way about asking questions, but that is a whole other thread isn't it?

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sounds like they don't want the initial work involved..

but needing new committee alone would not cause you to close.. but re elect another who may be more amenable..

once set up it is easier as the same is paid each week or month with no changes..

so much simpler in the long run.. everyone knows where they are..

staff with regular monthly income andtwho ever does the accounts with knowing the amount to pay...saves time....,

 

we get paid pro rata now but used to be paid hourly rate..and to save fingers getting burnt.. everyone knows time off is deducted from wages so that month will be less than usual.... so they don't get paid for time off...easily sorted out by daily register which states times and days of all staff and needs to be kept anyway...

 

Good luck.. try to highlight the positives in this.. like time saved and regular monthly expenditure on wages.. etc..

 

Inge

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