Childcare voucher scheme changes – Time is running out for small businesses!

Childcare voucher scheme changes – Time is running out for small businesses!

The Government Childcare Voucher scheme had its deadline to join extended for new members back in April 2018 by another six months.

The initiative, which means parents can save up to £933 a year on childcare, was supposed to be closed to new members in April 2018 making way for Tax-Free Childcare, another scheme that was launched last year, but it is now available for employees until 4th October 2018, but then employees will no longer be able to join this scheme.

So, that means that there is just one month until the old scheme will be closed, so I would recommend that small businesses encourage employees to join this scheme NOW!

If you or your employees are members of the Childcare Voucher Scheme, then you need to be aware of the changes from 4 October 2018.

In summary:

  • The Childcare Voucher Scheme will no longer be available to new applicants.
  • A new scheme ‘Tax-Free Childcare’ is now available subject to eligibility.
  • Existing membership of the Voucher scheme will continue as long as your situation does not change. For example, if you leave your current employer or choose to take up the ‘Tax-Free Childcare’ scheme, you will no longer be eligible for Vouchers.


What is the existing Childcare Voucher Scheme?

You can take up to £55 a week of your wages as childcare vouchers, which you do not pay tax or National Insurance on. The amount of vouchers available depends on how much you earn and when you joined the scheme.

There is no deadline for using vouchers, you can continue to use any vouchers you already have, and can make a joint payment for childcare with ‘Tax-Free Childcare.’


What is ‘Tax-Free Childcare’?

You can get up to £500 every three months (£2,000 a year) for each of your children to help with the costs of childcare. The government will pay £2 for every £8 you pay your childcare provider via a ‘Tax-free Childcare’ online account.

You can use it to pay for approved childcare. You can get both ‘Tax-Free Childcare’ and 30 hours free childcare if you’re eligible for both.

Your eligibility for Tax-Free Childcare is dependent on the following criteria for:

  1. You and your partner
  2. Your child and
  3. Your childcare provider

If you successfully apply for ‘Tax-Free Childcare’ you cannot continue to claim childcare vouchers.

Employees must tell their employers within 90 days.


The reason to encourage your employees to take this up now!

If your employees stay on the old Childcare Voucher scheme, this will be better for you in terms of tax breaks as it allows you to reduce the amount of NI and tax you pay, but the new Tax-Free Childcare scheme will not.

On the current voucher scheme, both employer and employee pays less in NI and tax contributions, so this scheme will benefit you both – so if you have employees with children it is a good idea to make them aware of this scheme as soon as possible if they don’t already know about it so that they can take advantage.

Unfortunately, with the new scheme, employers are not able to claim anything back if an employee opts-in to it, but it would be good practice to make sure that your employee is also aware of the new scheme as an option as there are benefits that might suit them better. For example, for any single parents, other family members are also able to opt in for that child.

Still confused? Give me a call and we can talk you through it all 🙂

Managing Annual Leave

Managing Annual Leave

Managing Annual Leave in your business

Running a business comes with many challenges, perhaps none more so than balancing the demands of your business against the demands of your staff to take time off! Inevitably there will be peaks and troughs throughout the year but there are always some periods when you can expect demand to be higher.

Certainly, the best summer (so far), since 1976, coupled with England’s ‘so near, yet so far’ performance in Russia has meant that many businesses have experienced even higher than usual requests for time off over the past few months, which would usually be more evenly spread across the year.

So, how do you manage that? And where do you stand if you are struggling to cope with all your staff being off?

This is one area that having expertly drawn up Employment Contracts will prove to be your saving grace. Robust documentation will clearly set out exactly what your company’s leave policy is, how much notice staff are required to give before taking leave and what might happen if several staff apply for the same period of time off.

Are you prepared for the Annual Leave anomaly of the decade?

Does your annual leave year run from 1st April to 31st March?

If so, you could be at risk of breaching the Working Time Regulations!

We can all get a bit confused by the way Easter shifts around from year to year, but in 2018 and 2019 there is an added complication. The reason you could find yourself breaching Working Time Regulations is that there is no Good Friday bank holiday in between 1st April 2018 to 31st March 2019, a phenomenon that we won’t see again until 2024!

How do I know if this applies to me?

Check your Employment Contracts. If your staff are entitled to 20 days annual leave, plus bank holidays, the current leave year will see them only receive a maximum of 27 days leave. One day less than the statutory minimum of 28 days and thus, an unintentional breach of Working Time Regulations.

Don’t be daft, Good Friday doesn’t just disappear!

Of course, you are absolutely correct! Here’s how it worked. Good Friday in 2018 was on 30th March 2018, thereby falling in 2017/18’s leave year. Meanwhile Good Friday 2019 will be on 19th April 2019 – well into the 2019/20 leave year.

What can I do about it?

To be honest, not much. A minimum of 28 days is required by law and you can’t negotiate out of this.

You could undertake a full workforce consultation in order to agree the carry forward of up to eight days leave into the next leave year. However, even if you do this you must still top up their current year’s leave entitlement to 28 days in order to ensure you meet the legal requirements.

Can I do anything to future proof myself?

It would be advisable to review how you have defined annual leave entitlement within your Employment Contracts.

When you start to make any changes to contracts, it’s vital to seek expert advice. Apart from ensuring that you make all applicable changes in one go, a qualified advisor will be able to support you through the consultation and implementation process.

What else do I need to know?

As with many aspects of running a business, HR rules can be complex and the impact of non-compliance on your business, far reaching. Don’t gamble with the business you’ve worked so hard to build.

For your FREE HR Healthcheck contact me on 02382 025160 or [email protected]

How to calculate annual leave for part-time employees

How to calculate annual leave for part-time employees

One of the most commonly asked questions, when I am doing my HR Health Check, is how do you calculate annual leave for part-time employees?

Although employers are giving their employees holidays there is a whole host of ways on which they are calculated.

What is the Statutory Annual Leave Entitlement?

At present, the Statutory Annual Leave Entitlement is 5.6 weeks paid holiday per year which equates to 28 days.  Employers are allowed to include bank holidays as part of the statutory entitlement.  But how do you work out part-time employees?

The way you calculate annual leave for a part-time employee is based on their working week.

If you have a part-time employee who works the same number of hours each day be it 2 or 8 you would calculate their annual leave using the following formula

5.6 x number of working days = Holiday Entitlement

Examples of annual leave entitlement for part-time workers

Flossie works Monday, Tuesday and Thursday 8.30am – 2.30pm.  As Flossie works the same number of hours each day her holiday entitlement would be

5.6 x 3 = 16.8

By law, you are not allowed to round down but you are allowed to round up to the nearest half day.  Therefore Flossie would be entitled to 17 days holiday.

Calculating annual leave as a number of hours per year

When an employee works different hours each day, it would be easier to give a number of hours per annum an employee is allowed to take.

If Flossie works 20 hours per week you would work out her holiday entitlement by 20 (hours per week) x 5.6 = 112 hours holiday per year.

Again, this calculation includes the bank holiday entitlement.

Calculating annual leave for zero hours contracted employees

For zero hours contracted employees annual leave starts to accrue as soon as the worker begins work.  They are still entitled to a pro-rata amount of 5.6 weeks holiday, which is equivalent to 12.07% of hours worked over a year.  The way this is worked out is by taking 5.6 weeks holiday and dividing it by 46.4 weeks (which is 52 weeks less 5.6 weeks.  So, annual leave is accrued at a rate of 12.07% per hour.

If Flossie works a total of 15 hours in a month she is entitled to 1.8 hours holiday.

Bank and Public Holidays

There are normally 8 specific bank holidays in each calendar year.  It is worth including this number in contracts and handbooks on the rare occasion that this increases.  With the Queens Jubilee, an additional day’s Bank Holiday was given but it was not a statutory entitlement.   An additional days holiday for every employee can soon add up.  This means that especially for small businesses the day would either be unpaid or taken out of your holiday entitlement.

It is important to include the bank holidays as part of the overall holiday entitlement even though all staff may have these days off to avoid underpayment of holidays for part-time staff.  The majority of bank holidays fall on a Monday and if a part-time employee only works Tuesday, Wednesday and Thursday they would not get as much holiday as their full-time equivalents.

Accrual of Annual Leave

In the first year of an employees employment, an employer may use an accrual system.  This means an employee gets one-twelfth of their annual leave entitlement in each month.  So by the third month, an employee would be entitled to a quarter of their total leave.  After the first year, an employer can no longer use this system.

Rolled-up Annual Leave Pay

An employer must pay holiday pay when the annual leave is taken.  An employer is no longer allowed to include an amount of for holiday pay in the hourly rate (known as ‘rolled-up annual leave pay’).

In summary for calculating annual leave for part-time employees

  • Make sure you have a clear contract and handbook that states what bank holidays are included or a total number
  • Annual Leave is part of a statutory Employee Benefits package, so it needs to be correct.
  • Use the formula’s above to calculate the annual leave of any part-time employees
  • If you have incorrectly calculated an employees holiday entitlement then get in touch, it is not too late to make it right.
If you need any help then please click here to book a time to speak to me or why not sign up to receive my blog direct to your inbox each week.
Paws for thought on Pets at Work Policy

Paws for thought on Pets at Work Policy

We all know that the United Kingdom is known for its love of pets, What are the practicalities of having a Pets at Work Policy in your workplace? You might have seen a few pictures of my cat Jess every so often.  With days like National Dog/Cat Day or bring your pet to work day, it always opens the can of worms for employers.  Should they allow pets come into the workplace?

Now if you are an employer then you might want to consider a few things before you let employees bring their beloved pets into your workplace.  With everything, it is good to start as you mean to go on and have a set of ground rules.  Bringing a pet into work is an employee benefit which small businesses, in particular, could use, which is cost effective.

Things to consider when deciding whether to have a policy for bringing pets to work

Do your research

It is usually the animal lovers at work who first bring up the subject of bringing their pets to work.  But not all employees like pets and this could be for various reasons from allergies or a phobia.  Make sure as part of a wider benefits survey you really get an understanding of if all your employees would be happy to have pets at work.

Allocate days of the week as being Pet-Friendly

Although studies have shown that having pets in the workplace has reduced stress and increased morale, they can also be a distraction.  In order to strike a balance make certain days of the week or month days in which pets are welcome in the workplace.

Pet free zones

Ensure that you have thought about where pets should be allowed – although at home the kitchen is allowed maybe this should be something to consider in the workplace.  Where should pets be allowed to wander on their own and where must they not be let attended.  Making the decisions before allowing pets in the workplace makes things a lot easier going forward.

Communication is key

Ensure that there is a channel for employees to raise any concerns about the pets in the workplace.  Maybe make it part of the employee forum or health and safety committee and include as a static part of the minutes.  We all know not all pets get on so that could be something that is discussed.  Maybe limit the number of pets in during one day.

Pets must be pet-friendly

Before considering bringing your pet to work, think about how they are around other people.  Most importantly how are they around other animals.  At the end of the day, you are at work to work and not to look after your pet.  If your pet is quite happy curled at your feet fast asleep whilst you work – great.  If your pet a little hyper or always needs attention – maybe they might not be suitable in the workplace.

Keeping it clean

Make sure included in any pet policy there is a section about cleaning.  It is not fair for your employer to have to clean up fur from your office.  Make sure you are prepared in case your pet has an accident and take responsibility for ensuring all carpets and furniture are clean.

In summary for Pets at Work

  • Make sure you get the support of all employees to even think about pets in the workplace.
  • Ensure you have rules and guidelines for things such as sickness, antisocial behaviour, and damage in a robust Pet Policy.
  • Limit the number of pets in on each day or allocate days in which pets can come in.
  • Don’t bring your pet to work if you have lots of meetings, asking someone else to watch your pet is not very productive for them.

Please feel free to get in touch to talk about how a policy would fit in your workplace.

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Maternity – What to expect when your employee is expecting

Maternity – What to expect when your employee is expecting

When you take on an employee as a small business you accept that there are going to be challenging. Managing short-term absence, what will you do to cover holidays as a couple of examples. The area that still puts small businesses in absolute fear is those two words ‘I’m Pregnant’.
For some employers a pregnant employee puts them in a spin, not knowing how the will cope especially with the cost. Getting pregnant is life, I remember once a General Manager removing a chair from his office. The reason as whenever a female member of staff came in for a period of a week – they all told him they were pregnant. 3 members of your sales team – all pregnant within weeks of each other – now that is a challenge.
Maternity Leave is an employee benefit that is a statutory right but let’s take Baby steps. So I hope that the following advice will at least help stop the room from spinning for a short time.

Antenatal Care

All pregnant employees are entitled to a reasonable amount of paid time off to attend antenatal care. When we say reasonable ensure there is time to get their and back and if possible have at the beginning or end of a day.
Point to note
You are allowed, apart from the first appointment, to see the appointment card or letter. Make sure you do so that you can plan around appointments where necessary.
Also, an expectant father or partner of a pregnant woman has the right to take time off work to go to 2 antenatal appointments.

Statutory Leave

All pregnant employees have the right to 52 weeks Maternity Leave. That doesn’t mean that they have to take the full 52 weeks but there is a legal minimum.
All employees must take at least 2 weeks leave following the birth, or 4 weeks if the employee is a factory worker.
Maternity Leave is split into two parts. 26 weeks of Ordinary Maternity Leave and 26 weeks of Additional Maternity Leave. If an employee decides to take additional maternity leave then they are not guaranteed to return to the same job but something similar.

Statutory Maternity Pay (SMP) vs Maternity Allowance

Depending no how long the pregnant employee has worked for you along with how much they earn decides if they get SMP or Maternity Allowance.
The good news is employers can claim back at least 92% of the Statutory Maternity Pay and can in some cases be 103%. Make sure you get some advice on this and claim back what you can.
SMP is paid directly from the employer to the employee like a wage, whereas Maternity Allowance is claimed via the benefits office.
Click here to find out the latest statutory payment rates.

Risk Assessments

Make sure you conduct regular risk assessments on your pregnant employee. Depending on your business depends on what factors will need to be considered.
Don’t forget to conduct a Risk Assessment when the employee returns to work, especially if they wish to express milk at work.

During Maternity Leave

During Maternity leave, employees get all their normal terms and conditions of employment apart from wages.
Also, holidays can be transferred from one year to the next and an employee keeps on accruing holiday during maternity leave. Don’t get caught out on this one.

Redundancy for pregnant or employees on Maternity Leave

It is a myth that employees who are pregnant or on maternity leave cannot be put at risk of redundancy. You need to ensure that you are conducting a fair transparent process. It would be good to get some advice to make sure you are doing everything to protect yourself and your employees.

In summary, always put yourself in your employee’s shoes and if something doesn’t feel fair or reasonable when applied to yourself it probably isn’t.
PS Don’t forget apart from all this admin to wade through your employee is pregnant and it should be a happy time so don’t forget the cake!

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How to stay competitive with pay without breaking the bank

How to stay competitive with pay without breaking the bank

National Minimum Wage has increased on the 1st October and in April 2017 it has been announced the National Living wage will increase again.  How does a small business remain competitive and keep their talent?

I wish I could wave a big magic wand and say here is the answer – but I am afraid it is not that simple.  I know I hear you say – when is it simple.  But as small businesses, you can be more creative in the employee benefits you offer.

The National Living Wage stopped some small businesses from increasing staff of taking any on. With the unemployment figures decreasing finding the ‘right’ staff to fill vacancies – a can-do attitude makes up for a lack of experience sometimes.

By September 2017 the majority of businesses will have workplace pensions in place and that is an additional cost that the business needs to find from somewhere.  I know I hear you say where is the good news when is she going to get to the good stuff.

Perkbox – what’s that I hear you say – it is basically an online website and now a lovely app that employers pay for each employee and they can access discounts online and in store.  Discounts range from grocery shopping to cinema vouchers, free coffee or 2-4-1 of high street chain restaurants – and it is cheaper than you think!

So an example if your employee spends £40 a week on shopping that’s £2080 a year.  If you save 4% on that is £83.20 that’s two free shopping weeks a year or some new shoes!  You would pay less than that discount per employee per year.

I would think about the following when thinking about additional benefits for your team

What makes them tick

Is it a drink at the pub on a Friday or a treat every so often – did I mention cake earlier?  No business is the same and there is no cookie cutter method of deciding what benefits will suit your team best.  Ask them.  I know that is a shocking thought but would they prefer you to give some extra holiday or invest in a perk like Perkbox

Blended learning

Ensuring your team is as best as they can be and developing their talent is what they want.  Spending time with them and increasing their skills costs you your time but not necessarily cold hard cash.  Not all training has to be sat in a classroom and is a huge benefit to an employee.  An employee may prefer you spending some money on enhancing their skills and there is still funding available.


Review your benefits every few years.  Times change and what people want changes, don’t get complacent.


Don’t forget to budget for all the costs – including the cake as it all adds up.  If you do something one year then employees will expect it the next.

If you want some ideas on different benefits then drop me a note or give me a ring.  If you wanted to find out more about Perkbox click here and you can contact one of their friendly team.

Don’t keep it a secret

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