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Law for Business

Knowhow - guidance - precedents

Loch Employment Law , 20 APR 2015

The New Universal Credit Arrangements

Pam Loch

Managing Partner


The New Universal Credit Arrangements
Universal Credit is a new monthly payment for those on a low income or are out of work. It replaces the previous system which involved a 16 hour a week rule which resulted in some workers restricting the hours they worked to avoid losing their benefits. Universal Credit aims to ensure that individuals will be better off in work than on benefits.

This new system should have a positive impact for employers in that it should:

  • be easier to find workers who are willing to consider short term or irregular work 
  • result in part time employees being willing to do more overtime and extra shifts at peak times and avoid you incurring additional overheads and the risks associated with recruiting and training new staff to fill these gaps 

Universal Credit payments are linked to how much money an employed Universal Credit recipient has earned. Changes in the way you report PAYE information to Her Majesty’s Revenue and Customs (HMRC) in real time have been made to facilitate this. As an employer HMRC requires you now to send in PAYE information about every payment you make to employees at the time you make it. PAYE information relating to Universal Credit claimants is sent by HMRC to the Department for Work and Pension.

For more information on reporting PAYE in real time, go to the HMRC website or if you require assistance with any other queries please contact us.

Pam Loch, Managing Director of niche employment law practice, Loch Associates Employment Lawyers and Managing Director of HR Advise Me Limited.

For more information on Loch Associates Employment Lawyers please go to www.lochassociates.co.uk and for HR Advise Me go to www.lochassociates.co.uk

Loch Employment Law
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