Other types of pay

By Tolley in association with Sarah Bradford

The following Employment Tax guidance note by Tolley in association with Sarah Bradford provides comprehensive and up to date tax information covering:

  • Other types of pay
  • Guarantee payments
  • Suspension on medical grounds

Guarantee payments

An employee is entitled to a guarantee payment for any workless day. This is a day throughout which he would normally be required to work but his employer does not provide him with work because:

ERA 1996, s 28
  • it does not need as much work done of the kind the employee is employed to do (eg due to a lack of orders)
  • something happens which affects the work he is required to do (eg a threatened power cut) (Miller v Harry Thornton [1978] IRLR 430)

A 'day' is the period from midnight to midnight except where a period of work extends over midnight into the next day, in which case the work is treated as falling wholly within the day (from midnight to midnight) in which the majority of work was done.

ERA 1996, ss 28(4), 28(5)

In general, the right to a guarantee payment only arises after an employee has been continuously employed for one-month ending with the day before the workless day. An employee is not entitled to a guarantee payment where:

The failure to provide him with work is due to a trade dispute

More on Pay: