Calculating figures for Redundancy - PILON and average pay

MattyBoy551

Hi all,

I've been advised I am "at risk" of redundancy and have had a first consultation with my Head of Operations and HR Rep. I did not have a rep present as I was given short notice, but will moving forwards as I think they are making mistakes.

I have been advised I will receive 3 months pay in lieu of notice, and this figure has been based on my basic pay of £11,049. I am of a strong belief that this is incorrect, and here is my thinking for why:

Basic pay: £44,200 pa, £3683 a month, £11,049 over 3 months
Car Allowance: £4000 pa, £333 a month, £999 over 3 months
Overtime payments for the last 3 months: £890
On Call Allowance for the last 3 months: £2475

I make this a total of £15,413. When calculating the average over 12 weeks (/13, x12) I get £14,227. This is over £4k difference that I really don't want them to screw me out of if possible.

Am I right in thinking that I am due the average of my pay INCLUDING the overtime callout and in call as I am paying tax/NI on those components within my monthly payslip?

Many thanks in advance.

Matt

MattyBoy551

Sorry, £3k difference  

tightauldgit

Is there anything in your contract regarding PILON and how it will be calculated?

I think the basic rule of thumb is you should get what you would be contractually entitled to if you continued to work so I would think car allowance should be included but possibly not overtime as there would be no contractual obligation to give you overtime I presume. 

HillStreetBlues

Agree with the above, does your contract guarantee either overtime or on call allowance?
If not I can see why the figure is different as they are paying you for the next 3 months, and in those months they won't pay  any extras.

MattyBoy551

Thanks for the reply.

There's no mention in my contract regarding PILON or how it will be calculated. There is also no contractual overtime mentioned, if there can be such a thing.

My understanding is that I would be entitled to anything I would have earned during that period, calculated on the previous 12 weeks of employment prior to my notice date. As I normally receive overtime every month (and have done so in varying degrees for 6 years) I would be entitled to claim an average of that for my notice period.

I'd appreciate any further comments if anyone can add more to this?

Many thanks,

Matt

PS: It is £4k difference 

tizerbelle

You are mixing up your PILON with the average weekly calculations used for redundancy payments.

Your PILON will simply be 3 months of your normal salary & car allowance - this will be treated in the usual way on respect of pension contributions, tax, NI.

They may calculate your redundancy pay (which is different to PILON) any way they like as long as it matches and/or exceeds statutory redundancy pay levels.  This is where the last 12 weeks gross pay figure comes in.  You can receive up to £30k redundancy pay tax-free.

400ixl

Is the car allowance just applied to your base salary, or called out as an additional income.

From what I have seen, if the latter then it is not included in PILON as that will just be your base salary. If it is in your base salary then it should be included in the PILON payment.

The overtime and on call car allowance I would not expect to be in your base salary, so not in the PILON payment.

MattyBoy551

Morning all, and thanks for the replies.

I've found out that my employer has a copy of my contract that states that PILON is at base rate of pay, so I am not entitled to any overtime, on call or car allowance to be included within the payment. Not what I wanted to hear, but I think I'm at a point where I'll be glad to be out of there, so I'll take what I can get 

tightauldgit

MattyBoy551 said:

Morning all, and thanks for the replies.

I've found out that my employer has a copy of my contract that states that PILON is at base rate of pay, so I am not entitled to any overtime, on call or car allowance to be included within the payment. Not what I wanted to hear, but I think I'm at a point where I'll be glad to be out of there, so I'll take what I can get 

If that's what your contract says that that's what it is. But weird if your employers version of the contract and yours are different.