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Payslips

Published On:Friday, January 8, 2021

The Isle of Man Employment and Equality Tribunal issues "best practice" guidance in regards to Payslips.

Employers have had to issue an itemised pay statement to employees when they get paid to set out gross pay, any deductions and net pay for many years now.

Following a case that the IOM Tribunal heard on 16 December 2020, it has issued important pointers as to what employers should do as best practice from now on.

  1. The Written Statement of Terms and Conditions of Employment that an employer must provide should now explain how payslips will be provided.
  2. Employers should keep a written record which confirms that they have explained the payslip system to employees to prevent subsequent disputes and ultimately ending up in Tribunal.
  3. The provision of an on – line payslip, including password-protected access, is enough to meet the requirement that the payslip has been “given in writing”. If an employee informs the employer that they have genuine problems with access, the burden is on the employer to provide the payslip(s) in another way consistent with these guidelines.
  4. If the system does not involve any physical hand-over of payslips or provision online, then payslips should be readily available in a location convenient to the employee. For example, if a business operates from an HQ in Douglas but has outlets in Port Erin and Ramsey, there is likely to be a need for three identified convenient locations. This may be different if the employee regularly visits HQ, even though they might be based elsewhere. Whether the system is compliant will be for the employer to prove if a dispute reaches the Tribunal.
  5. In those rare situations where wages are paid in cash, the payslip and cash should be provided simultaneously in one envelope.
  6. There should be no obligation on the employee to ask for payslips. Employers should not regard the statutory obligation as being a print-on-demand situation. They must be readily available at or before the time of payment.
  7. If wages are paid direct to an employee’s bank, it would be helpful if this is made clear in the statement of terms and conditions, or is otherwise confirmed in writing in a separate document. It should be clear when, within any pay period, the payment will actually be made so that payslips can be issued on or before the payment date.
  8. Employers should notify employees in writing that there is an obligation on the part of employees not to leave payslips lying around where other employees or third parties may be able to read them.
  9. Whatever system for giving payslips is adopted, it must be GDPR compliant meaning that the employers’ duty of keeping information confidential must be achieved.
  10. As mentioned above, there is no obligation on an employee to ask for payslips. The burden is on the employer to provide them but, in the event of a payslip system failure or problem known to the employee about receipt, then the employee must raise this with the employer.

A final and noteworthy point from the Tribunal is this:-

Terms & Conditions of Employment

The Complainant contended that because the written statement of Terms and Conditions had not been signed by him, the terms were not binding on him. That is incorrect.

The obligation was for the Respondent to provide the Terms and Conditions of employment under section 8 of the Employment Act 2006 and this was done and not disputed. No signature is required.

The full decision is published on the Courts website:-

https://www.judgments.im/content/J2763.htm

We have updated our links and templates to incorporate this guidance but if you have any queries please get in touch.