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  • FIRST POST
    loolamadcat
    Under paid & agreed amount of back pay
    • #1
    • 9th Dec 12, 8:32 AM
    Under paid & agreed amount of back pay 9th Dec 12 at 8:32 AM
    Hi

    2004 - One of my staff (under another line manager) underwent a payment review and was put on a new structure along with the rest of the organisation

    2008 - This staff member received an 8k back pay cheque as she had been put on the wrong pay band due to a change in her role. However, her pay point was frozen at 33k when it shouldn't have been. She raised this with her manager and payroll

    2010 - The payroll member that was dealing with this left the organisation but didn't hand the case over. I became the staff member's line manager (and knew nothing of the situation) and the staff member stopped pursuing her claim with payroll

    2012 - This outstanding query was bought to my attention by payroll as they had happened across it. The staff member was uplifted to the correct pay point of 35k, however there is outstanding back pay from between 2008 and 2012 to consider

    I have discussed the situation with her and she will be grateful for any back pay she can get, and realises she is at fault for not pursuing the claim. We can afford to pay her the back pay from the start of this financial year of around. We could pay her 20% (using the Pareto principle to weight where culpability may lay) of the total amount outstanding, but we can't afford to pay her the whole amount - although that isn't her problem

    She should simply be entitled to the full amount as she has earned it, but I believe she had the responsibility to pursue it. Are we right in agreeing to pay her a portion (i.e. this year's amount) or should we legally be paying her the full amount?

    I would appreciate any guidance you can offer

    Many thanks
Page 1
    • agrinnall
    • By agrinnall 9th Dec 12, 9:30 AM
    • 22,820 Posts
    • 18,839 Thanks
    agrinnall
    • #2
    • 9th Dec 12, 9:30 AM
    • #2
    • 9th Dec 12, 9:30 AM
    I'm fairly sure that CAB won't handle this directly as they deal with individuals not businesses (although they might have advised the employee had she raised it with them). In my view the company should be paying the full amount of back pay owed, you seem to be treating this as if it's your own money, but unless you have concealed the fact that you own the company that isn't the case. I also don't think you can necessarily put any blame on the employee for not pursuing it, while it would have been sensible to do so she had already raised it and it was then down to the company to resolve, the failure lies with the organisation. I would expect that if she went to an Employment Tribunal over this she would win - there may even be a case for paying interest on the money owed. Do the right thing and tell HR to pay it.
  • CAB Malvern Hills representative
    • #3
    • 10th Dec 12, 8:59 AM
    • #3
    • 10th Dec 12, 8:59 AM
    Hi

    2004 - One of my staff (under another line manager) underwent a payment review and was put on a new structure along with the rest of the organisation

    2008 - This staff member received an 8k back pay cheque as she had been put on the wrong pay band due to a change in her role. However, her pay point was frozen at 33k when it shouldn't have been. She raised this with her manager and payroll

    2010 - The payroll member that was dealing with this left the organisation but didn't hand the case over. I became the staff member's line manager (and knew nothing of the situation) and the staff member stopped pursuing her claim with payroll

    2012 - This outstanding query was bought to my attention by payroll as they had happened across it. The staff member was uplifted to the correct pay point of 35k, however there is outstanding back pay from between 2008 and 2012 to consider

    I have discussed the situation with her and she will be grateful for any back pay she can get, and realises she is at fault for not pursuing the claim. We can afford to pay her the back pay from the start of this financial year of around. We could pay her 20% (using the Pareto principle to weight where culpability may lay) of the total amount outstanding, but we can't afford to pay her the whole amount - although that isn't her problem

    She should simply be entitled to the full amount as she has earned it, but I believe she had the responsibility to pursue it. Are we right in agreeing to pay her a portion (i.e. this year's amount) or should we legally be paying her the full amount?

    I would appreciate any guidance you can offer

    Many thanks
    Originally posted by loolamadcat
    HI

    If the staff member is owed the back pay under her contract of employment with the company as appears to be the case then they may well be in breach of contract for not paying it all. In which case she could potentially have a case for breach of contract against the company if she was mindful to take it that far. Not sure why it is her fault for not pursuing it it seems to have been raised as an issue and then events happened beyond her control which stalled the process. She seems to have been a loyal employee over the years so if your company cannot really afford to pay it all then perhaps the best thing to do is sit down with her and be honest about it and reach a compromise as you have already suggested. You could also explore paying the outstanding amount in stages and she may be amenable to this. Suggest also that if you went down this route then for clarity it might be best to put any mutual agreement in writing.
    Official CAB Representative
    I am an official representative of CAB. MSE has given permission for me to post in response to questions on the CAB Board. You can see my name on the companies with permission to post list. If you believe Ive broken any rules please report my post to forumteam@moneysavingexpert.com as usual"
  • loolamadcat
    • #4
    • 12th Dec 12, 9:52 PM
    • #4
    • 12th Dec 12, 9:52 PM
    Thank you so much for your reply it is helpful. I have taken advise from HR who are now looking in to the matter on our behalf.

    Feedback re the CAB pilot if you would like it? Fantastic - fast, informative and so accessible. I hope it becomes a regular feature

    Regards Loo
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