Share this content
0
16361

No more reclaiming SSP

No more reclaiming SSP

Didn't find your answer?

Search AccountingWEB

No more recovering SSP from April next year. "Percentage threshhold scheme being replaced by HWS" sounds less dramatic. Was everyone aware ?

Replies

Please login or register to join the discussion.

25th Nov 2013 12:47

OK - I'll take the bait!

What is HWS?

Thanks (0)
avatar
25th Nov 2013 13:13

HWS

It is an advice line funded by the money no longer paid out as SSP recovery

 


 

Thanks (0)
25th Nov 2013 13:15

Not any clearer

What does HWS stand for and where is this news coming from? Could you possibly provide a link please.

Thanks (0)
avatar
By Kazmc
25th Nov 2013 13:19

???

Recovering SSP & Compensation or just Compensation??

Link would be great thanks

Thanks (0)
25th Nov 2013 13:28

No compensation on SSP

It is SMP that you get compensation on, not SSP.

Is SMP affected by this as well? A search on HWS is not turning up any useful results.

Thanks (1)
25th Nov 2013 13:37

OK - I have found something

Have a look at this guidance and the changes to the RTI specifications for EPS.

All SSP recovery is being abolished, but apparently there will be some relaxation of the record keeping requirements for SSP, which will still be payable by employers.

Thanks (1)
avatar
25th Nov 2013 13:52

SSP

 

 

 

 

 

Thanks (0)
avatar
25th Nov 2013 16:41

link

 

 

Thanks (0)
25th Nov 2013 13:53

Ludicrous statement

I can't believe that someone in government genuinely said that the current scheme

Article linked by Euan wrote:
...offered no incentive for the employer to get the employee back into the workplace.
Because small employers, who are the most likely to use the scheme, are very laid-back about missing people from their small work-forces aren't they. Small employers aren't going to care that an advice line is being set up. They are going to be more concerned about the impact on their bottom line of being forced to make a payment to someone not doing any work and not being able to get it back.
Thanks (2)
25th Nov 2013 14:07

yet another barrier

Yet another barrier to employment.

Thanks (0)
avatar
25th Nov 2013 16:30

Just wondered if people knew about it as seems to have come in under the radar.

Thanks (0)
to Jack49
26th Nov 2013 08:00

Not heard

daveforbes wrote:

Just wondered if people knew about it as seems to have come in under the radar.

To answer your question, this is the first I'd heard of this, though I don't regularly do payroll these days. I asked our payroll person here, and they hadn't heard anything either.
Thanks (0)
avatar
25th Nov 2013 16:45

Hang on, are they really saying that all employers, small and large alike, will have to fund all SSP with no recompense at all for the small employers now?

 

Thanks (0)
to Wanderer
25th Nov 2013 16:53

Yes

monksview wrote:

Hang on, are they really saying that all employers, small and large alike, will have to fund all SSP with no recompense at all for the small employers now?

That's exactly what they are saying!

Thanks (0)
avatar
25th Nov 2013 17:43

yep

... and then spending the money on something useful - an advice line.

Thanks (0)
avatar
25th Nov 2013 19:42

SSP

Good God.  Hammering the small employers into the ground and stopping some others from growing due to the worry of employment laws.  Well done HMRC.  Hope you're proud of yourselves.

 

Thanks (2)
By puzzel
26th Nov 2013 09:31

And when you was

having headaches understanding RTI, did they not say that any SSP to be reclaimed was noted on the EPS, but never mentioned it would be stopping from Apr 14.

 

 

Thanks (0)
By Wieslaw
26th Nov 2013 09:42

Moneysoft confirm...

Thought the software manufacturer would know for sure, they have confirmed just now on the phone, that they are currently developing 2014-15 software with the PTS abolished...

Thanks (0)
26th Nov 2013 13:55

News to me but just further goes to increase my dislike of payroll! 

Could a zero hours contract solution get around this for all members of staff perhaps?

Thanks (0)
avatar
26th Nov 2013 14:05

EPS

As a payroll software developer I can confirm that the SSP reclaim value is definitely removed from the 2014/15 EPS submission.

Putting everyone on a zero hours contract to try to get around paying SSP seems like it would be a sledgehammer to crack a nut for most employers, though. If it were that easy why haven't employers always done it, given that many of them never qualified under PTS anyway?

Thanks (0)
to markogrady
26th Nov 2013 14:11

Sledgehammer

neiltonks wrote:

As a payroll software developer I can confirm that the SSP reclaim value is definitely removed from the 2014/15 EPS submission.

Putting everyone on a zero hours contract to try to get around paying SSP seems like it would be a sledgehammer to crack a nut for most employers, though. If it were that easy why haven't employers always done it, given that many of them never qualified under PTS anyway?

 

If a sledgehammer is a little OTT then can you suggest an alternate more in the "toffee hammer" department?

Thanks (0)
avatar
26th Nov 2013 14:40

Total b*llocks

In the current economic climate, the Government has a responsibility to use resources where they will be most effective, so we will not be introducing another reimbursement scheme in place of PTS.  However, abolition of the PTS will enable us to recycle the funds of around £50m a year into the development of the new assessment and advice service, ensuring the funds can be used in a more effective and targeted way to help employers reduce sickness absence.                       THIS IS WHY GOVERNMENTS BECOME UNPOPULAR THEY DONT UNDERSTAND SMALL BUSINESSES, WHY SHOULD THE (SMALL) BUSINESS PAY FOR STAFF ON THE SICK

Thanks (1)
avatar
26th Nov 2013 14:42

No toffee hammer

Sadly, there's no obvious 'toffee hammer' approach either.

The SSP regulations are deliberately drafted in such a way as to make it hard for employers to avoid the obligations (as is always the case with these things).

Every employee is entitled to SSP provided they meet the criteria in terms of length of service, earnings, number of qualifying days in the absence etc. Determining the earnings in the relevant 8-week period to work out the average earnings simply involves looking at what was actually paid over that period. It's a matter of fact. The other vital component are 'qualifying days', where the rules basically say to use the contractual days if there are any, otherwise use the days the person normally works. If someone has a zero hours contract but in practice always works Monday to Friday, then those are the qualifying days, I'm afraid.

Thanks (1)
By DJKL
26th Nov 2013 15:24

Always look on the bright side, more work for accountants.

NEWS FLASH

The Treasury today announced that in the past year 2,000,000 employees have been made redundant, however in a massive increase in entrepreneurial spirit there have been 2,000,000 new companies incorporated. The Chancellor credited the new company formations to their own efforts in improving the economy , "We are creating an environment where new business opportunities exist, "but disclaimed all responsibility for the slew of redundancies across the country.

He further reported that there was a significant increase in demand for the services of accountants, lawyers and purchase ledger assistants, however there had been a corresponding significant downturn in economic activity in the bureau payroll service industry and heavy redundancies as firms appeared to be downsizing staff requirements in their payroll departments.

He stated that he was surprised by the events and could not understand what might have changed business behaviour. 

 

Editors Note

(The Chancellor , aged 42, read Modern History at Oxford before working for the NHS as a data input clerk, folding towels for Sainsbuys and  working as a freelance journalist. He then gave up real work to become a researcher, an MP and most recently Chancellor)

 

Thanks (4)
avatar
27th Nov 2013 13:44

One more reason not to be an employer

With RTI, work place pensions and now having to pay SSP without any reimbursement will be the final nail in the coffin for small employers.

My business could not afford to pay SSP for many weeks before I would need to seriously think about where we are going.

I have employee off sick at the moment. She has had an operation but is fit and well enough to drive all over the country visiting friends and family and has said she wants to come back to work. Fit enough to push a shopping trolley around a supermarket etc.  But a visit to the doctors last week and he gave her a sicknote for 4 more weeks as she is not fit enough to do her desk job!

She wants to come back to work but if the doctor says she is not fit to work and I let her come back and she has an accident where would I stand.

At the moment HMRC refund me most of the SSP but if this happened next year I would be seriously out of pocket. I would need to challenge the Doctor(how do you do that) so that I could say she was fit to work to save me being out of pocket.

The problem lies with the doctors not the employers.

 

 

 

 

Thanks (2)
avatar
27th Nov 2013 13:46

Need to let employer know

I picked up on this on Monday - not sure when it was released but we need to ensure that all small employers know about this. The cost implications are substantial and impact would close certain businesses.

 

What next - withdraw reimbursement of SMP?

Thanks (0)
avatar
27th Nov 2013 14:01

Announced ages ago

The planned demise of PTS was announced at the beginning of the year (the earliest reference I can find was the 17th of January) and was also mentioned on Budget day, so it's not a secret.

Another announcement in the Budget was the Employment Allowance which will reduce the annual NI bills of most employers by £2000 from April 2014. This will more than compensate for the loss of SSP recovery in many cases (it's the equivalent of over 20 weeks' SSP payments), provided the employees earn enough to pay NI in the first place, of course.

Thanks (0)
avatar
27th Nov 2013 14:18

beyond belief isn't it !

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/181072/health-at-work-gov-response.pdf  -- the full 80 pager !

1. It is stupid

2. It seems to have snuck in under the radar.

"Partnerships with key stakeholders including health and business leaders have been crucial in motivating and driving this change"

Yeah, right.

16. There is general acceptance for the need for reform. Employers find the current scheme cumbersome and complex to administer. Currently, about 100,000 employers claim reimbursement with a cost to the Exchequer of approximately £50 million per annum. Most of these payments are for small sums.

17. It is estimated the additional administrative burden associated with the scheme costs employers between £2.5 million and £5 million per annum. Employers would welcome an alternate form of support which would help them enable employees, wherever possible, to remain in work.

How many of them said "ooh can we have an advice line instead of the money".

For all the good it will do, I am going to write to my MP.

 

Thanks (1)
avatar
27th Nov 2013 15:41

@neiltonks

So all the payroll software developers are aware of it, but no one else ! Hence my post. Even then it was only this week the full impact hit me. It was not me making the change in our software so I had not really looked into it - I thought it was going just to be a change in the calculations rather than replacing financial support with an advice line. From a payroll developers perspective the impact is about 5 minutes work, so my reaction is not as a software developer.

Thanks (1)
avatar
27th Nov 2013 15:51

Employers NIC of £2000 to compensate

Get real - as a small employer I incur about £50 per month in employers NIC - but for each employee off sick it will cost me over £100 for a week.  Your employee is entitled to SSP even if you do not incur employers nic on them.

You have to actual incur £2000 in employers NIC to get the offset so the two do not equate.

 

 

Thanks (1)
avatar
27th Nov 2013 15:55

Employer Bulletins

Just looked at the last 3 employer bulletins - they mention the £2000 employer NIC rebate (but badly explained) but no mention of the loss of SSP recovery. Bulletins from Feb, April and September.

So it seems HMRC are once again failing to notify employers of pending 'bad news'.

 

Thanks (4)
to andy.partridge
27th Nov 2013 17:12

That is ...

sally1964 wrote:

Just looked at the last 3 employer bulletins - they mention the £2000 employer NIC rebate (but badly explained) but no mention of the loss of SSP recovery. Bulletins from Feb, April and September.

So it seems HMRC are once again failing to notify employers of pending 'bad news'.

... a very good point.

Thanks (1)
avatar
10th Jan 2014 20:49

So...
let me get this right in my head, HMRC are going to calculate SSP, tell us when to pay it and for how long and not allow ANY recovery! This on top of plans to raise minimum wage. I can see many small businesses closing as the cost of having employees is just going to get too expensive!

Thanks (0)
06th Feb 2014 12:08

PTS RIP

I can still find nothing on HMRC's website about this change, other than an obscure line in the tech spec for the EPS showing SSP recovery as 'data item removed'.  The payroll industry knows about it and is factoring it in to next year's software and routines, but small business is only just waking up to it.  One micro business I've just come across has an employee on long-term sick leave due to cancer treatment.  It can bear the cost while it reclaims SSP in excess of 13% of its NIC bill, but it won't be able to do so after April.

The HWS is not supposed to be 'an advice line' - it is a new Health & Work Service.  When I say 'is', it will be, once it is up and running, which seems to be planned for late 2014, although there seems to be much official vagueness about the practical aspects of the new policy and the timing of the HWS's creation.  The DWP literature suggests it will be an occupational health service for small employers.  Anyone who has been off sick for four weeks will be referred to it. by his or her GP  The service is being funded by the abolition of the PTS.

Some small businesses will probably close as a result of losing the funding.  I can remember when SSP replaced DHSS sickness benefit, and employers simply offset SSP aganst their NIC bill.  It was a social security benefit delivered via payroll. In 1991, the recovery was restricted to 80%.  From 1995, the cost was transferred onto employers, effectively saying 'they work for you, you look after their welfare', with the PTS providing catastrophe relief for small businesses who could not bear the cost if too many employees were off sick at once. I can't see how that logic has changed.

The authors of the DWP report that triggered this change appear not to have considered the practical  impact on small and micro business.  Referral of someone with a bad back to HWS might  get them some physiotherapy sooner and get them back to work sooner, but if a number of employees in a small business go down with the flu, or one person is off long-term for chemotherapy, it could cripple the business.

Thanks (2)
avatar
By pringoo
04th Apr 2014 13:58

give with one hand and take with the other

I only discovered this issue today when I went to run all my P32 summaries for month 12 of 13/14 year and discovered the SSP reclaimed entry was missing. I phoned Sage who told me how to print them correctly for the last tax year, but advised me that as of 2014/15 it was no longer reclaimable and had been replaced by the Employers Allowance instead. That's all very well, but as a lot of folk here are saying, it's mostly the smaller companies who are able to reclaim the SSP - those who hardly pay any employers NIC in the first place. In fact, I have one client who employs 2 carers, one of which is off on long term sick just now having had a double knee replacement. That client will not be able to claim the Employers Allowance as you can't claim it for employing carers, but they will still have to fork out the full amount of SSP for the next 20 or so weeks. It's getting beyond a joke.

Thanks (0)
avatar
13th Apr 2014 13:18

Employer Allowance and ssp recovery

 

We operate a small domiciliary care business where we employ 26 people, a proportion of our staff work on a part time basis and they are often advised externally that, it is sometimes better for them to claim sickness and get a sick note, be off for 28 weeks and go onto ESA as they can get paid the same, for doing nothing. This has happened at least 5 times to us in the last 2 years. We can’t get rid of them and SSP recovery was our only life line. With regards to Employer Allowance I have rang HMRC several times and get a different answer every time. Can someone help please, we provide personal care to an individual but we are not employed by that individual. Can we claim Employer Allowance? HMRC say yes, then no, it’s a shambles, and this will have a dramatic impact on the care industry as if has a high historical poor sickness record with low profit margins. As a small employer the whole system is against us, we feel.

Thanks (0)
Share this content