You could be mistaken for thinking that the current Childcare Voucher scheme has now closed (after all we have been talking about it since 2017 now….) however it has now been extended for new members by another 6 months following a Commons debate, with a revised closing date of October 2018 (exact date still tbc).
The current Childcare Voucher scheme (which means that parents can save up to £933 a year on childcare) was due to close to all new members on 6th April, making way for the new Tax Free Childcare scheme which was launched in April 2017.
So, what’s the difference between them? In short, both schemes reduce the cost of childcare but one scheme may suit an individual’s circumstances better. The most significant difference between the 2 schemes is that Tax-Free Childcare offers savings per child per year, while childcare vouchers offer savings per parent per year.
With childcare vouchers, each parent can take up to £55 each week from their salary before tax and National Insurance, or £243 a month, to spend on childcare no matter how many children they have, as long as the parent is a basic-rate taxpayer and the employer has chosen to run the scheme.
The Tax-Free Childcare initiative however is much more akin to a savings scheme and under the rules parents have 20% of their childcare costs each year met by the Government, up to a limit of £2,000 a year per child (or £4,000 if your child is disabled) The scheme is directly managed by the employee and not the employer and so employees are not restricted based on whether or not their employer runs the scheme.
What do you need to know as an employer? If you don’t offer child care vouchers to your employees you don’t need to do anything! However, if you do offer Child Care vouchers you should be aware of the following:
- Anyone who joins the Childcare Vouchers scheme before the scheme closes can continue to benefit from the savings for as long as their child remains eligible, they must also stay with the same employer, or have received a voucher within the last 12 months;
- Employers will continue to benefit from up to £402/year savings in employer NI for every parent on the scheme;
- Once an employee has left Childcare Vouchers to move to Tax Free Childcare scheme, they cannot rejoin
- Employees can’t use both schemes at the same time.
For help or guidance on Child Care Vouchers or any other benefits related query contact us at www.thehrhub.co.uk.
Image Credit: Unsplash
It is just over five years since the first employers started to automatically enrol eligible workers into a qualifying pension scheme but for your SME it may have been a lot more recently.
Up until 6th April 2018, the minimum contribution under auto enrolment rules has been set at 2% (of which the employer has been required to contribute at least 1% of the employee’s salary) However, on 6th April 2018 there will be an increase from the current total minimum contribution of 2% of qualifying earnings, rising to 5% (of which the employer must contribute at least 2% of qualifying earnings whilst employees make up the difference of 3%). Contributions will then rise again on 6 April 2019, eventually reaching a total minimum contribution amount of 8%. These changes will apply to all employers regardless of the size of their business and so even if you were part of the last wave of business to auto enroll employees you will still be subject to the changes.
When you initially rolled out your auto enrolment scheme you should have sent each eligible member a letter which set out that contribution levels will increase over time. If that was some time ago (and in fact even it was recently) it is likely that many employees will be unaware of these changes and the impact it will have on their income. So, although there is no legal requirement or additional duties for you to write to your employees about the increases you should consider reminding them about the change as it can provide an opportunity for employees to financially prepare for the statutory increases and potentially reduce the number of scheme leavers and opt outs.
Summary of Contribution changes
||Minimum Employer contribution
||Total minimum contribution
|Until 5 April 2018
|6 April 2018 to 5 April 2019
|6 April 2019 onwards
It remains the employer’s responsibility to ensure pension schemes are qualifying and that contributions are deducted accordingly, so, remember to contact your scheme and payroll providers to make sure that the change in contributions will be correctly calculated and paid.
You don’t need to take any further action if you don’t have any staff in a pension scheme for automatic enrolment, or if you are already paying above the increased minimum amounts and remember that these increases don’t apply to staff who asked to be put into a scheme that you don’t have to pay into.
For help and support with the upcoming changes to auto enrolment contact us at www.thehrhub.co.uk or call us on 0203 627 7048.
Everyone realises that you are meant to have some kind of ‘HR’ function, but when you are busy growing an sme, all the focus is on just that, so stepping back to write policies and procedures tends to get pushed to the bottom of the list.
Then you have a little freak out moment and realise your HR framework could make or break you. The information age gives everyone knowledge at their fingertips and if you haven’t thought about it, you can be sure your employees will be quick to point out their rights if anything goes awry. In the early days this could be even more crucial as any hiccup in those early hiring stages could be enough to cause a financial hit you simply can’t take.
Luckily for you, we’re here to tell you which ones you need and which ones are considered best practice.
Writing policies and procedures can be a minefield in this day and age so where do you start?
Surprisingly there are only 3 policies you should provide that are required by law. They are:
- Disciplinary and Dismissal Policy
- Grievance Policy
- Health and Safety Policy (needed by law if you employ over 5 employees)
There are also a number of policies that you should provide because they have legal minimum requirements – these are…..
||Legally you must pay your employees at least the National Minimum wage and ensure Equal Pay; you must also provide an itemised pay statement and not make any unauthorised deductions from employees pay
||Legally you must not discriminate against staff or allow harassment and bullying and you must make reasonable adjustments for staff in the work-place if they are disabled
|Working Hours and Overtime including rest-breaks and holidays
||Legally you must comply with Working Time Regulations provisions for employees and workers
|Sickness policy and unauthorised/authorised absence
||Legally you must make statutory sick pay payments to employees and allow them time off for dependant emergencies, Jury Service etc.
|Maternity, Adoption, Paternity Leave, Parental Leave and Shared Parental leave
||You must make statutory maternity / adoption / paternity payments to employees and give the appropriate leave
||You must consider all employees flexible working requests
Finally you may wish to consider additional policies to ensure consistency within your business, for example:
- personal e-mail / internet usage
- alcohol/drugs in the workplace
- dress codes
- data protection
- Smoking rules
There are no legal guidelines for these policies and they can be designed around the needs of your business (for example, no smoking, including E-cigarettes, other than during lunch hour).
You should only put policies in pace that are going to be used. Having a policy for the sake of it is pointless! Focus, keep it simple and write policies which are meaningful to your business, then stand by them.
theHRhub is the ultimate online HR support service for Startups and SMEs – providing software, templates, expert advice, whitepapers and up to date news and views, straight to your mobile or tablet. It’s like having an HR director in your pocket but without the price tag!
Call us on 0203 627 7048 or drop us a line at email@example.com for a no-strings chat about your HR needs.
Image : Pixabay
In this increasingly litigious world you’d be forgiven for thinking that writing HR policies and procedures is a mine-field in this day and age. Writing and tweaking policies for your business – whatever its size, can take up a huge amount of time and stress. So it may seem like the easy option to download your policy templates from the internet, but a one size fits all solution is always dangerous and you are likely to end up putting into place way more policies than you actually need….
Surprisingly there are only 3 policies that are required by law.
There are also a number of policies that you should provide because they have legal minimum requirements.
There are few other policies that you could consider to ensure consistency within your business.
- Personal e-mail / Internet Usage
- Alcohol/Drugs In The Workplace
- Dress Codes
- Data Protection
There are no legal guidelines for these policies and they can be designed around the needs of your business. For example, no smoking (including e-cigarettes) other than during lunch hour.
Where Do I Start?
When it comes to writing policies copious content is not king. There are millions of pages of policies & procedures rotting away completely unused in filing cabinets and shared network folders that will attest to this fact. Don’t get fooled into thinking that you need a policy for every eventuality – you don’t. And in fact, too many draconian policies can be restrictive to a small business that is growing.
The types of policies that you need depend on your business type: If your employees operate heavy machinery then you should consider putting in a Drugs & Alcohol Usage Policy but if you are an accountancy firm then this policy is unlikely to be a priority for you.
It is essential to create realistic employment policies – and enforce them. Using a policy to pay lip service to health and safety or treating employees fairly is not enough. If the worst happens and a problem ends up in court or at an employment tribunal, you’ll need to be able to show that you put your company policies into practice.
Communication Is Key
Policies can be part of your employee/company handbook or you can set them out in a separate document. However, for your discipline and grievance policies, you must either set them out in a written statement of main terms and conditions of employment or refer in a written statement to a place where the employee can read them, such as the company intranet.
You should ensure that you make staff aware that your policies exist. The best time to do this is during the induction process (which doesn’t have to be a 3 day off site event but can be something as simple as a checklist to ensure that a new employee to your company has all the relevant information that they need). You should also make sure that employees can easily access policies if necessary, by having them pinned up on a noticeboard for example or, again, on the company intranet.
Contractual Or Not?
Policies generally aren’t contractually binding unless they expressly state otherwise. However, the terms of some policies could be seen as contractually binding through custom and practice e.g. where employees follow certain working practices or receive certain benefits over a significant period of time. You need to be conscious of this as ultimately it will be up to an Employment Tribunal to decide on the contractual nature of policies if a claim were ever to be brought against your company.
Policies are never finished and you must ensure that you regularly review your policies and procedures to ensure that they are up to date, reflect the needs of the business and reflect any legislative changes.
Effective Company Policies
Whatever your policies cover, you should follow 2 essential principles to make a company policy effective.
1 – Make sure any policy is clear
2 – Make sure that any policy is communicated to employees. Unless employees understand a policy it will not work.
You do not want to tie yourself or your managers up with too many rules as this will only prove to be restrictive to day to day operations. Equally policies and procedures must be realistic, meaningful and be something that you and your management team are prepared to stand by. There is no point in stating that persistent lateness is a disciplinary offence and then not disciplining the one employee who is late every Monday morning. This type of approach will only lead employees to the conclusion that policies are meaningless, making them almost impossible for you to enforce.
For further advice and support on policy implementation, or any other HR issues contact theHRhub today on 0203 627 7048 or drop us a line at firstname.lastname@example.org
You can’t have failed to see the news and read the articles about pension auto enrolment over the past few years. And now, as the roll-out reaches its end, it’s time for the last remaining employers to jump on board.
Currently all firms with over 50 people must auto enrol all employees aged over 22 who earn more than £10,000 a year. And by February 2018 all smaller businesses will also have to comply. If your business has between 1 and 10 employees it’s likely that your staging date is fast approaching.
In case you need reminding, auto enrolment is a government initiative to help more people save for later life. In the past, many workers missed out on the benefit of a pension either because their employer did not offer one or because they had failed to join their company’s scheme. Under the government initiative, all employers are required to enrol eligible employees into a workplace pension scheme before their given auto-enrolment staging date.
As part of the initiative there are minimum level of contributions that you will need to make to your employees’ pension and these will gradually increase over time. You can of course contribute more than the minimum but you must, at the very least, meet these guidelines:
||Employers minimum contribution
||Total minimum contribution (employer+employee)
|Up to 30th September 2017
|1st October 2017 – 30th September 2018
|1st October 2018 onwards
So now we’ve recapped on the basics of auto enrolment let’s take a look at what you need to do next:
1. Find out when your staging date is
Check the Pension Regulators website here.
2. Decide if you want to use a financial advisor to help you get your scheme in place
You will need to understand and agree which tasks you and they are doing so that nothing is missed so make sure you agree that (and the costs) upfront.
3. Choose the right pension provider
The sooner you can make the decision as to which provider to go with, the better. More than one million businesses will need to meet their automatic enrolment duties in 2017. This means that pension providers will be swamped with new company pension scheme applications. In addition, selecting your provider now will leave you with plenty of time to focus on communications and making sure you are prepared for launch. There are some pension schemes aimed at SMEs that do not have set up costs or monthly charges for automatic enrolment, while other schemes may charge so make sure that you shop around. Remember to ask the provider what they will charge you based on how many staff you have. The National Employment Savings Trust (NEST) is a pension scheme provider that has been set up by the government and must accept all employers that apply to use it for automatic enrolment. They do not have a set-up charge so you can contact them if you do chose to set up the scheme yourself.
4. Engage your staff in your new workplace pension
You should start to consider how you will engage your staff when it comes to your workplace pension. The law states that an employer only needs to send out one piece of communication, but be cautious. Sending out limited information to your employees will more than likely mean that you are inundated with questions from your employees. Our advice is to do a little extra when it comes to communication and educate your staff in advance. Let them know that you too are contributing to their pension and playing your part.
Once you have set up your workplace pension you will need to complete and submit a Declaration of Compliance form (this can be done online). This form will let The Pensions Regulator know that you have met your legal duties for automatic enrolment. If you are using a 3rd party to help you set up your workplace pension they will often complete this part of the process on your behalf.
So, start to think about automatic enrolment sooner rather than later and don’t delay it. Remember that you don’t have to wait until your staging date and could set up your pension scheme early.
For help and support with your company’s auto enrolment contact us at theHRhub for a chat about your requirements. Drop us a line at email@example.com or call us on 0203 627 7048.