CIL - Paying Personal Assistants

Paying Personal Assistants

By the time you have selected and appointed your Personal Assistant, issues like rates of pay, conditions and expenses will have been agreed. An essential part of being a good employer is paying your staff fairly. The employee will need to know when you intend to review the rate of pay. As an employer, it is necessary for you to be aware of some legal responsibilities on you.

Good Employers

Be a good employer and you are more likely to keep staff.

Below are examples of good employment practices:

Clearly state what employees are entitled to in their contract of employment.
Make sure you pay on schedule and regularly.
Pay your employees a fair wage.
Pay employees the same for equal or similar work.
Keep employees' personal details confidential.
Record clearly hours worked and wages paid.
Pay travel (other than to and from their place of work, i.e. your home, normally). Reimburse employees for money they spend on your behalf.
Be clear about when pay rates will be reviewed. This should include mileage allowance.
Always retain signed receipts/payslips and provide Personal Assistants with a copy.
Discuss openly and honestly your own and your Personal Assistant's concerns about wages or expenses in relation to his or her employment with you.

Legal Responsibilities

Employers must comply with regulations set down in law.. These are about how much you have to pay and for what, including any necessary deductions from wages, what allowances you need to make with pay and your method of payment.

You are legally required to;

Collect Income Tax and National Insurance Contributions due from your employees.
Cover Statutory Sick Pay and Statutory Maternity Pay if necessary.
Cover holiday pay.
Usually make no deductions from your employees pay unless they ask you to in writing or it is part of the contract of employment.
Give equal pay to employees carrying out the same or similar duties.

How much you should pay

The rate and timing of paying staff will usually be agreed between you and your Personal Assistant. This will be included in the contract of employment and should be reviewed at least annually. Payment rates for unsociable hours and overtime may also be incorporated in the contract.

As an employer you must pay your workers a minimum amount for the work they do. The amount you have to pay is decided by law and is known as the National Minimum wage.

There are three levels of minimum wage:

Workers aged 22 years and older are entitled to £5.73 per hour.
There is a development rate of £4.77 per hour for

Workers aged 18 - 21 years of age inclusive
Workers aged 22 years and above, who are starting a new job with a new employer and doing accredited training. Accredited training is a Government approved course that leads to a vocational qualification.

A minimum rate of £3.53 per hour should be paid to all 17 year olds and 16 year olds who are above the compulsory school leaving age. In Northern Ireland a person may leave school after the 30th June of the school year in which their 16th birthday occurs.

You will need to consider a payment rate for unsociable hours (8pm - 8am, weekends and bank holidays).

If you offer your Personal Assistant accommodation the offset to the minimum wage is now £4.46 per day (£31.22 per week).

As an employer, you should avoid treating anyone unfairly or unequally, in relation to pay on the grounds of religion, gender or disability etc.

Payslips

Employers must give their employees an itemised payslip that will include the following;

Method of payment - If you pay your employee with a mixture of, for example, cash and cheque it must be stated on the payslip.
Gross pay - The amount paid before any Tax or National Insurance deductions have been made.
Net pay - The amount paid after deductions.
The amount of each deduction and the reason for it - If deductions are always likely to be the same, it is necessary to show the total only. Deductions can be itemised separately.

Described below are the items that you must pay for as an employer;

Hours worked

You need to pay your Personal Assistant(s) for the hours they work.

Holiday pay

All employees (including part-time workers) are entitled to 5.6 weeks paid holiday per year after having worked for you for three months.

Statutory Sick Pay

Employers are required by law to pay Statutory Sick Pay (SSP) to their employees during sickness if they qualify. The weekly rate of SSP for 2010 - 2011 is £79.15.

The qualifying conditions for SSP are that;

The employee's average weekly earnings before he or she became ill was more than the lower earnings limit for National Insurance Contributions (£97).
The period of sickness is at least four days. This is known as the Period of Incapacity for Work.

Please note that in relation to meeting the qualifying conditions all days count towards a Period of Incapacity for Work, including weekends and public holidays.

You should only pay Statutory Sick Pay for qualifying days. These are the days or hours that your Personal Assistant would, under normal circumstances, be expected to be working for you.

No Statutory Sick Pay is paid for the first three days (known as waiting days) of sickness in a Period of Incapacity for Work.

If an employee is absent for four to seven days you would usually ask for a self-certificate form. You can design your own form or SC1 or SC2 forms are available free of charge from Social Security offices. For sickness leave lasting seven days or more you may ask for a medical certificate. You have no right to insist on a medical certificate for illnesses of less than seven days.

As an employer you can reclaim the Statutory Sickness Pay paid out in any month where it comes to more than 13% of the total National Insurance Contributions paid by the employee and employer. This is known as the 'percentage threshold scheme'.

Statutory Maternity Pay

Pregnant employees are legally entitled, provided that qualifying conditions are met, to receive Statutory Maternity Pay (SMP). If your employee has average gross weekly earnings (before deductions) of £97 per week she can get SMP for up to 39 weeks. For the first 6 weeks your employee will be entitled to 90% of her weekly earnings. In the remaining 33 weeks she should be paid £123.06 per week or 90% of her average weekly earnings if this is less than £123.06.

To meet the qualifying conditions, the employee must:

Have average weekly earnings that are higher than the lower earnings limit for National Insurance Contributions.

Have been constantly employed by you for at least six months when the baby is due.
Still be pregnant at the eleventh week before her baby is expected.
Have stopped working for you.

Statutory Maternity Pay covers 39 weeks. Your pregnant employee is entitled to receive SMP for that period, regardless of whether or not she intends to return to work for you.

You will probably be able to claim the Statutory Maternity Pay back in full under a scheme called the Small Employer Relief scheme because your National Insurance Contributions are unlikely to exceed £20,000.

You get the money back by deducting Statutory Maternity Pay paid from your monthly/quarterly payment of National Insurance Contributions.

You can get more information on pay and time off for parents in the Employer's Help Book E12 (2008) which is available form the Inland Revenue.

If your employee does not qualify for Statutory Maternity Pay, she may still be able to get Maternity Allowance.

For further information on Statutory Sick Pay and Statutory Maternity Pay, you should contact CIL - Belfast or

Business Support Team
Inland Revenue
Beaufort House
Level 8
31 Wellington Place
Belfast BT01 6BH

Telephone 028 9033 4527
Fax 028 9053 2524

Severance or Redundancy Pay

Employers must, by law, make redundancies fair. A person who has been employed by you for two years or more is entitled to redundancy pay.

The amount of redundancy to pay depends upon the employee's age and will be between half and one and a half weeks' pay for each year worked.