Understanding payroll regulations and contributions of your home country can be difficult enough but trying to make sense of foreign laws can seem like an impossible task.
Whether it’s your rights as an employee or your obligations as an employer its a necessity to understand local workers benefits and payroll obligations.
Mandatory occupation pension (Superannuation) is comprised of funds from the employer and government.
- Employer – 9.5% of employees earning
- Government – depends on the employees’ annual income.
Both employers and employees contribute to pension.
- Employer – 3%
- Employee – 5%
Employees have a 2% levy on taxable income.
Employers and employees contribute to the National Insurance Contributions (NIC).
- Employers – 13.8%
- Employees – 12% (an additional 2% is contributed from employees earning above the upper limit)
Payment is given based on continuous period of service, and pay rate is given for ordinary hours worked.
1 year but less than 2 – 4 weeks
2 years but less than 3 – 6 weeks
3 years but less than 4 – 7 weeks
4 years but less than 5 – 8 weeks
5 years but less than 6 – 10 weeks
6 years but less than 7 – 11 weeks
7 years but less than 8 – 13 weeks
8 years but less than 9 – 14 weeks
9 years but less than 10 – 16 weeks
At least 10 years – 12 weeks
After two years of employment severance pay is according to age:
Half weeks’ pay for each full year under age 22
One week for each full year over age 22, but under age 41.
One and a half weeks pay for each full year over age 41.
Length of service is capped at 20 years.
Employer must provide a written notice for the day on which employment will be terminated.
Notice period depends on seniority of worker.
• 1 year or less – 1 week
• 1 – 3 years – 2 weeks
• 3 – 5 years – 3 weeks
• More than 5 years – 4 weeks
Employers are required to give employees notice of one week if the employees have worked at the company for at least one month. An additional weeks’ notice is required for each year employed after the first year. However, other periods may be listed in the contract.
Employee must provide at least 1 week of advance notice; however, this may be defined differently in the employment contract.
Female workers are entitled to 18 weeks at minimum wage (employers are reimbursed by the government).
39 weeks of maternity leave. First 6 weeks are paid at 90%. The other 33 weeks are paid either in 145,18GBP or at 90% rate, whichever is lower.
Workers whose spouse have given birth are entitled to 2 weeks at minimum wage (employees are paid directly by the government).
1-2 weeks of paternity leave. Leave starts once the child is born and finish within 56 weeks of the birth. Employees receive either £148.68 a week or 90% of their average weekly earnings (whichever is lower).
Workers are entitled to 10 days paid sick leave.
Employers are obligated to pay their workers Statutory Sick Pay (SSP) during sick leave at a rate of £92.05 per week for up to 28 weeks. SSP is paid from the 3rd day unless they have been paid SSP within the last 8 weeks and are eligible for it again.