With offices closing over the Christmas week it’s common place for an earlier December pay date. Make sure you are prepared and all divisions of the payroll team are aware of the new date. Just as vital, be sure to inform staff of exactly when they will be paid; this should be outlines in their contract but make sure you communicate the date to them as well.
The Christmas Bonus
Rewarding your staff at Christmas time with a healthy addition to their pay can be a great morale booster to keep everybody jolly over the festive season. Despite this, it’s an area you must approach with extreme caution. If you pay a consistent amount to all staff, it must be outlines that this is at your discretion; if you stop the bonus in the future you may be subject to claims by employees who believe they are entitled to this bonus due to it having been paid in previous years. Alternatively, if you determine the bonus amount on individual employee performance, make sure you can prove the bonuses were based on fair judgement, and not discriminatory.
We all know the banks love a day off, so just be careful when you make payments they will hit employees accounts at the intended time. With three bank holidays in quick succession take into account non-working days and adjust your payment / BACS timings accordingly.
If you are paying staff earlier than usual, look out for employees leaving in between payday and the end of the month. With salaries paid in advance, you will have to recoup the overpayment from the employee – often a lengthy and tedious process.
If your company allows pay advances for employees short on money, be prepared for plenty of requests at this time of year. Paying earlier means staff have a longer wait until next payday. Alternatively, if you are still paying at the end of the month, employees may ask for pay advances in preparation for the extra outlay Christmas brings. Ensure you have a strict, watertight policy which protects your company, otherwise recouping the money could be seen as an unlawful deduction, leading to further complications and potential tribunals.
Avoid these pitfalls and come Christmas you’ll be able to relax and enjoy the festivities.