Salary Sacrifice for part time worker

pippy45

Hi
I recently started working part time (22.5 hrs/wk) with a gross salary of £22,500 and have been informed by my employer that as my gross pay is below £25,500 I am ineligible for salary sacrifice,my understanding is that I should be eligible providing I don't fall below the National living wage,any thoughts on this please? 

Cressida100

I think you have to work for the company for 6 months beforehand. Perhaps ask again in 6 months?

Hoenir

Salary sacrifice is ultimately at the discretion of the employer. What actual reason did they give? Have they overlooked that you are a part time rather than full time employee. 

Grumpy_chap

pippy45 said:

Hi
I recently started working part time (22.5 hrs/wk) with a gross salary of £22,500 and have been informed by my employer that as my gross pay is below £25,500 I am ineligible for salary sacrifice,my understanding is that I should be eligible providing I don't fall below the National living wage,any thoughts on this please? 

For most people, minimum wage is £11.44 per hour.
42.5 hours per week for 52 weeks, that equates to £25.3k per year, so the £25.5k quoted is about right for a full time employee.
For compliance with minimum wage rules, that £25.5k should be pro-rata to actual hours worked.

At 22.5 hours per week, NMW equates to £13.5k per week.  Your £22.5k is well above this threshold.

Marcon

Cressida100 said:

I think you have to work for the company for 6 months beforehand. Perhaps ask again in 6 months?

No waiting period necessary unless the particular employer imposes one (hard to see why they would - it would make their own life much more complicated when running payroll).

pippy45 said:

Hi
I recently started working part time (22.5 hrs/wk) with a gross salary of £22,500 and have been informed by my employer that as my gross pay is below £25,500 I am ineligible for salary sacrifice,my understanding is that I should be eligible providing I don't fall below the National living wage,any thoughts on this please? 

Yes. Go back and remind them that you work part time and you have to be paid the minimum wage for the hours you work - not the full time equivalent. Not all employers understand salary sacrifice and it sounds as if that's the case here. Also a little matter of ensuring that part timers are treated no less favourably than full timers...

pippy45

I have worked for the company for 14 years and was full time until I agreed to return to work part time(ill health reasons),whilst working full time I was able to sacrifice a portion of my salary and was not informed that this would be affected if I returned to work part time

pippy45

Grumpy_chap said:

pippy45 said:

Hi
I recently started working part time (22.5 hrs/wk) with a gross salary of £22,500 and have been informed by my employer that as my gross pay is below £25,500 I am ineligible for salary sacrifice,my understanding is that I should be eligible providing I don't fall below the National living wage,any thoughts on this please? 

For most people, minimum wage is £11.44 per hour.
42.5 hours per week for 52 weeks, that equates to £25.3k per year, so the £25.5k quoted is about right for a full time employee.
For compliance with minimum wage rules, that £25.5k should be pro-rata to actual hours worked.

At 22.5 hours per week, NMW equates to £13.5k per week.  Your £22.5k is well above this threshold.

This is my understanding as well but my employer is sticking to the £25,500 'benchmark'

Marcon

pippy45 said:

I have worked for the company for 14 years and was full time until I agreed to return to work part time(ill health reasons),whilst working full time I was able to sacrifice a portion of my salary and was not informed that this would be affected if I returned to work part time

As above - go back and challenge on the grounds you are being treated less favourably than a full time employee simply because you are part time.

xylophone

Make sure that you challenge in writing.

FIREmenow

Does your workplace work a 37.5 hour week? (22.5 would be 3x 7.5 days.)

If so, then they are potentially also not being fair to some full time staff as on NMW they would earn ~£22,384.

If you are a trade union member that could be another avenue to query this.

Penguin_

Marcon said:

Cressida100 said:

I think you have to work for the company for 6 months beforehand. Perhaps ask again in 6 months?

No waiting period necessary unless the particular employer imposes one (hard to see why they would - it would make their own life much more complicated when running payroll).

pippy45 said:

Hi
I recently started working part time (22.5 hrs/wk) with a gross salary of £22,500 and have been informed by my employer that as my gross pay is below £25,500 I am ineligible for salary sacrifice,my understanding is that I should be eligible providing I don't fall below the National living wage,any thoughts on this please? 

Yes. Go back and remind them that you work part time and you have to be paid the minimum wage for the hours you work - not the full time equivalent. Not all employers understand salary sacrifice and it sounds as if that's the case here. Also a little matter of ensuring that part timers are treated no less favourably than full timers...

Not really hard to see why they would want a waiting period. If the salary sacrifice is for a car/bike etc then you want to make sure the employee is going to stick around.