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Payroll warning for businesses after volcanic ash incident

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19th Apr 2010
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Workers stuck overseas following this week's travel chaos cause payroll headaches for employers.

Severe travel disruptions caused by a volcanic ash cloud blocking UK airspace will have implications on payroll departments that have to deal with staff absenteeism due to stranded workers that cannot get back to the UK, warned the Institute of Payroll Professionals.

Since last Thursday, an erupting volcano in Iceland has grounded all flights above the UK, affecting thousands of airline passengers. As the volcanic ash cloud drifts across Europe this week, many parts of the continent will continue to be a ‘no-fly’ zone. Some 150,000 Britons are currently stranded abroad, according to travel agents' association Abta.

"Many of the employees who were due to return to work last week from their Easter holidays abroad would have been affected by the volcanic ash cloud. Therefore, payroll departments need to take the appropriate steps to work out whether there are contractual obligations to pay employees even if they cannot come into work," advised Lindsay Melvin, chief executive of the Institute of Payroll Professionals.

One of the key concerns for payroll staff will be whether the unplanned absence of stranded staff affects their annual holiday allowance or is treated as unpaid or paid leave.

Firms are advised to establish contingency plans now in order to deal with a potentially extended staff absence. "This serious situation will inevitably have an affect on business productivity with many employees unable to come back to work for an indefinite amount of time,” warned Melvin.

Airspace in Scotland, Northern Ireland and parts of northern England is due to reopen on Tuesday, according to the latest reports. Restrictions above the rest of England and Wales could be lifted later on Tuesday.

Has the incident affected your business? Post your comments below or check out our ash cloud thread to see what other members are saying.
 

Replies (4)

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By Democratus
20th Apr 2010 10:24

What's the problem?

If staff are on holidays and stuck it's at least unpaid absence, hardly the employers fault, if they were on business then it's payable time.

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By DMGbus
20th Apr 2010 13:40

Public sector = extra paid leave, the rest of us unpaid leave?

I am told that so far as teachers are concerned they've been told that they'll be paid for their extended absence.

I suppose that as their pay (and pensions) come out of public funds  the cost doesn't matter to the government - just have to send a few more tax repayment cases to "room 101" at Bristol or remove CT600 repayment cases from HMRC computer to fund the cost!

 

 

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By cthomas1967
21st Apr 2010 11:03

Not in Scotland

Teachers in Scotland that are stranded need to record the time as unpaid leave. England may be different?

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By User deleted
21st Apr 2010 13:04

Paid or unpaid

This is the same as the 'Snow Days' and will vary from employer to employer as presumably it is at the employers discretion - but warning, if employers agree to pay employees now, they maybe opening a can of worms for later in the year if it continues.  One scenario is that it my all settle down now, air travel returns to normal - but what if there is another erruption in say August when there could be more staff away!  Some employees will have travel insurance that covers this disruption, and they may be able to claim loss of earnings.    I do agree though that if they were on business trip then the employer must pay, but holiday is another matter. 

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