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Payslip legislation

The legal issues around payslips

Section 8 of the Employment Rights Act 1996 says: “An employee has the right to be given by his employer, at or before the time at which any payment of wages or salary is made to him, a written itemised pay statement.”

A number of issues are raised by the right to an “itemised pay statement.”

The “written” pay slip must be “given” to the employee by the employer.

The responsibility is on the employer to make pay slips available to the employee. If the employee does not know where to find the payslip or has no computer access to it, then it has not been “given” to the employee. This must be done “at or before” the time when the payment is made.

Businesses need to ensure that all employees can actually see their wage slips on payday if they wish to do so.

When the legislation was originally devised, this referred to a hand-written or typed piece of paper. Many employees will now be happy just to read their wage slip details on-screen and file the document away somewhere.

The statutory requirements cannot be ignored because the penalties can be severe.

The objective of the legislation is to ensure that employees are aware of all of the deductions that have been made from their pay at each pay day.

If they are unable to see those details on pay day they can make a complaint to an employment tribunal.

If the tribunal considers that the statutory requirements have not been met in respect of their pay slips, then the employer can be required to repay to the employee up to 100% of all of the unnotified deductions made from the employee’s pay in the 13 weeks prior to the date of the complaint, even if they were legitimate or statutory deductions.

If you would like to know more about payslip legislation or discuss outsourcing your company’s payroll, contact Robin Mead at Payplus on 0800 018 0590 rmead@payplus.co.uk or request a quick quotation.