Financial Procedures

4 Expenditure (continued)

4.5.3 Monthly Payroll
The monthly payroll makes payments to employees on the 24th (or previous working day) of each month. Staff on annual salaries are paid monthly whether full-time or part-time.

Employees are required to supply the Payroll Section with full details of their bank or building society accounts to facilitate the direct transfer of their pay to their accounts. At the due date each month, pay advices are distributed to staff within each department of the College.

Statutory deductions are made automatically by the computer for National Insurance, Income Tax and, where applicable, Superannuation. It is most important that new employees provide Payroll with information regarding income tax, national insurance, previous pension fund where applicable and, as stated in the preceding paragraph, full bank account details.

Other voluntary deductions from pay, (e.g. Trades Union subscriptions, payroll giving, ticket loan repayments), must be covered by the written consent of the employee. Forms for these purposes are available from the Payroll Section or Personnel Department.

4.5.4 Payment of Fees
Payments to visiting staff and other occasional engagements are made through the payroll system.

Payments will be made in arrears and credited to bank accounts by BACS on the 12th of the month provided claims are with the payroll section by the 5th of the month.

4.5.5 Income Tax and National Insurance
Payments of salaries and wages are normally subject to deduction of income tax and national insurance. All College employments will be treated as taxable unless HM Revenue and Customs notifies the College otherwise.
National insurance contributions are payable in all cases with the exception of employees reaching pensionable age. Members of staff reaching the age where they are entitled to exemption from payment should contact their local office of the Department of Work and Pensions and ask for an exemption certificate. This will be issued on production of documentary evidence of their National Insurance Number and date of birth. The exemption certificate should be handed to the Payroll Section who will take action to make future payments without national insurance deduction.

4.5.6 Superannuation
Most staff are subject to superannuation regulations. The superannuation scheme to which they contribute depends upon the nature of employment. Generally, academic and academic-related staff contribute to the Universities Superannuation Scheme (USS) and non-teaching staff to the London Pension Fund Authority (LPFA).

New employees are advised to contact the Payroll Section upon taking up duties so that arrangements can be made to establish membership of the appropriate scheme and where necessary transfer service gained in previous employment. It is important that correct action is taken at the time of commencement of employment with the College as loss of benefits may arise.

Staff approaching retirement age are recommended to contact the Payroll Section for advice on what action they need to take in order to claim superannuation benefits.

4.5.7 Sickness
(i) General Note

All employees receiving appropriate earning levels are entitled to Statutory Sick Pay if they are unable to carry out their duties due to prolonged illness, i.e. for a period of four or more consecutive days. The period of entitlement varies with appointment and is set out in employees’ terms and conditions of employment but should staff need reminding what they are or require clarification on any point, they should contact the Personnel Department or the Payroll section of the Finance Department.

The rules on SSP are very complex and difficult to express concisely. Nevertheless, it should be known that the College generally follows official guidelines although it may choose to better the provisions of the State. Personnel or Payroll can advise on an employee’s entitlement.

(ii) Employees' responsibility to report sickness

Heads of Departments are responsible for reporting absences to the Personnel Department who, in turn, will inform the Payroll Section of such absences. An employee who fails to submit written evidence of sickness by the fourth day of absence will be regarded by the College as being on unpaid leave. Payroll staff are required to keep statutory records of sickness in support of claims for repayment - by the Department of Work and Pensions - of sickness benefit paid by the College.

4.5.8 Statutory Maternity Pay
As with SSP, the College follows official guidelines on Statutory Maternity Pay (SMP).

All pregnant employees are entitled to 26 weeks ordinary maternity leave. Most mothers will also qualify to be paid statutory Maternity Pay or Maternity Allowance. Women who have completed 26 weeks continuous service by the beginning of the 14th week before their EWC can take additional maternity leave. Additional maternity leave starts immediately after ordinary maternity leave and continues for a further 26 weeks. A pregnant employee must notify her employer of her intention to take maternity leave by the end of the 15th week before her EWC, unless it is not reasonably practicable and also produce the MATB1 certificate. In addition to qualify for SMP she must:

(i) work for an employer who is liable to pay the employers share of class 1 National Insurance.

(ii) have 26 weeks continuous service into the 15th week before her baby is due. (The 15th week before the baby is due is known as the qualifying week).

(iii) have average weekly earnings in the eight weeks up to and including the qualifying week at or above the lower earnings limit (LEL) for the payment of national insurance contributions.

SMP is paid for a maximum of 26 weeks. The first 6 weeks are at 90% of average weekly earnings with no upper limit. The next 20 weeks are at a flat rate (2006 £108.85) or at 90% of average weekly earnings if that is less than the flat rate.

4.5.9 Maternity Allowance
Women who do not qualify for SMP may qualify for MA. This is paid by the Jobcentre Plus and is based on a woman’s employment earnings record.

4.5.10 Statutory Adoption Pay
Adoption leave and pay is available to adoptive parents where they are notified by the Adoption Agency that they have been matched with a child.

To qualify for SAP when adopting a child the employee must:

• Be a person with whom a child is expected to be placed for adoption under UK law.
• Have been continuously employed for at least 26 weeks into the matching week
• Have stopped working for, or taken leave, from the employer.
• Have weekly earnings at or above the LEL that applies at the end of the matching week.
• Give the employer notice of when they expect the liability to pay SAP to begin at least 28 days beforehand.

Entitlement to SAP will be confirmed by documentary evidence given to the employee by the adoption agency. Only approved adoption agencies will be able to issue this evidence. SAP cannot be paid without acceptable evidence. Once entitlement has been established it cannot be lost.

Leave can start on the date the child is placed or up to two weeks in advance of the expected date of placement. It may start on any day of the week but may only be taken in whole weeks.

SAP cannot be paid by an employer to an employee for any week during which the employee does some work for that employer or is entitled to SSP.

The maximum entitlement to SAP is for 26 weeks. There is a further entitlement to 26 weeks unpaid.

4.5.11 Statutory Paternity Pay
To qualify for Statutory Paternity Pay in respect of a new born child the employee must:

• Have a prescribed relationship with the child and the mother.
• Have been continuously employed for at least 26 weeks into the qualifying week.
• Remain in continuous employment with the employer from the QW up to the date of birth.
• Intend at the start of the Paternity Pay period to care for the child or support the mother.
• Have average weekly earnings at or above the LEL that applies at the end of the QW
• Give the employer notice of when he expects the liability to pay SPP to begin at least 28 days beforehand

Entitlement to SPP is by self-certificate. The rules on continuous employment and calculation of average weekly earnings mirror those for Statutory Maternity Pay.

Unlike SMP, entitlement cannot be established until the baby has been born. Even if more that one child is born as the result of the same pregnancy, only one period of SPP is available. If the baby is stillborn before the 25th week of pregnancy there is no entitlement to SPP in the same way that there is non for SMP.

Leave cannot start before the child is born and cannot continue later than the 56th day after the date of the childbirth.

SPP cannot be paid by an employer to an employee for any week during which SSP is due.

Leave and PPP can start on any day of the week but may only be taken in whole weeks.

Leave can be taken as a single period of either one or two weeks

Payment is currently £108.850 or 90% of average earnings if less than £108.85 (April 2006)