Employer payroll error - Didn't pay SMP - owes wife a few £1000

[Deleted User]

Wife works for NHS. Last few months she got her half pay but was supposed to get SMP on top.

Her employers payroll department have finally admitted they made a mistake and have offered to correct it on Decembers pay.

The amount is likely to be £2000+. If this is all added to December pay, does this mean there will be more tax/NI to pay (because theres so much in one month)? If so, seems unfair.

Also, this has caused us a lot of hassle and cost (bank charges). Is employer liable for any compensation for their mistake?

Mrs_Ryan

I got over a £1000 in pay arrears back from my employers (NHS) after they messed up my sick pay and yes I'm afraid it was subject to tax and NI. I wasn't aware of the mistake as my pay always looked right so I didn't get any charges etc but it might be worth speaking to them about compensation etc.

Sinhanada

It will be subject to tax and NI in the same way it would have been if it was paid correctly. You won't pay more for it.

With regards to bank charges etc, you will need to provide them with proof of the charges and that it was as a result of their mistakes and yes they should reimburse you for that.

It would be worth contact your payroll department (presumably SBS in Southampton) and they are usually very reasonable at sorting them out

PasturesNew

As the amounts are cumulative over the tax year, and assuming she's not on an unusual tax code such as BR or Week1 (which is very unlikely), then there will be no overall difference. If it were paid in April, say, there'd be an immediate potential for there to be more, as it's the new tax year, but it'd then work itself out across the year.

chrisbur

Without seeing the actual figures involved it is impossible to say what affect this will have on NI but the most likely affect will be either no affect or a slight reduction in NI.
Tax will not be affected as has been said unless on month 1 code then may be an increase but this will be eventually corrected when the tax code is made cumulative so even then no affect really.