Arrangements for individuals paid by claim: purpose and principles

1. This document (which replaces the guidance issued in July 2008 and updated in November 2008 and February 2009) details the arrangements which apply to all payments by claims. Different arrangements apply to self-employed persons engaged under a contract for services (see section on Engagement of self employed consultants). Payments will only be made if they comply with the procedure detailed in this document.

2. To meet the requirements of employment law and to safeguard the University’s position as an employer, the University expects most individuals engaged to work for the University to be employed in accordance with standard employment arrangements (ie on a contract of employment approved via the SR1 process). The claims payroll should only be used for engagements which are ad hoc or of very short duration.

3. Individuals are engaged on a claims basis for a number of reasons, where the engagement is ad hoc or of a very short duration. For example:

• short-term/ad hoc administrative or clerical work (the Temporary Staff Bank (TSB) in Human Resources);
• casual bar, catering or cleaning work in Campus Services;
• short-term/ad hoc basis academic work – such as tutorials, teaching, guest lecturer etc – as an Occasional Teacher or External Examiner or Graduate Teaching Assistant (see paragraph 4 below);
• students engaged on a casual basis – eg by Academic Services, DARO and Colleges – for open days, fundraising etc;
  casual instructors in the Sports Office;
• exam invigilators.

4. Individuals engaged on a short-term/ad hoc basis to undertake administrative or clerical work should be managed through the Temporary Staff Bank in Human Resources. Other individuals engaged on a short-term/ad hoc basis should be managed in accordance with the arrangements detailed in this document.

5. Rates of pay: The University has published recommended rates of pay for Occasional Teachers (see Pay Information pages), which are updated annually following national pay awards. Rates of pay for other types of work should be discussed with your HR Business Partner and should normally be based on the first point of the grade which most closely matches the value of the work. To take account of workers’ rights to paid leave under the Working Time Regulations, hourly rates should include payment for pro-rata paid leave entitlement.

6. Terms and Conditions: Work offered on a claims basis is subject to the terms and conditions for individuals paid by claims.

7. Pension arrangements: Where an individual has been engaged on a claims basis for 12 consecutive weeks, they have the right to opt-in to the ERBS scheme, so that the remuneration they receive is pensionable. Where an individual elects to opt-in, the employing unit will be charged the employer’s pension contribution.

8. Audit standards and Financial Regulations: Colleges/Services are reminded that claims can only be submitted for hours actually worked. Knowingly providing false information is a serious disciplinary offence which may lead to dismissal. Under no circumstances should a payment be made to an individual from petty cash or any another account. It is not permissible for a member of staff to pay an individual from their own resources and seek reimbursement via an expense claim.

9. Colleges/Services are reminded that there are limits on the sums which can be paid to an individual through the claims payroll in any one academic year. These limits are necessary for audit purposes to ensure that the claims payrolls are only used for work which is genuinely ad hoc/irregular and small scale. Where the work is regular/ongoing and more substantial, a contract should be offered following approval through the SR1 process. In cases of doubt, advice should be sought from your HR Business Partner.

10. Authorisation: Colleges/Services should notify the Payroll Office of managers who are authorised to countersign claim forms, using form PD83. From an audit perspective, it is recommended that the number of authorised signatures is kept to a minimum (eg Dean of College and College Manager/Administrator).

11. Employment Status of Individuals paid on a Claims Basis: The law on employment status is complex. Generally, where there is no ‘mutuality of obligation’ – ie the organisation is not obliged to provide work, and the individual is not obliged to accept any work which is offered – then an worker will not be able to claim statutory employment rights. Where the work undertaken by an individual is genuinely ad hoc/irregular and small scale, then no mutuality of obligation is likely to arise. However, where the work is more regular/ongoing and more substantial, then it is more likely that an Employment Tribunal may treat it as an employment relationship. Similarly, if the individual is promised work over an extended period and is expected to attend work, then this is unlikely to be treated as a casual arrangement, even though this is paid on a claims basis.

12. It should also be noted than a number of statutory rights apply to any person who performs or undertakes work or services for an employer, whatever the nature of the relationship between them (referred to in the legislation as ‘workers’). The Working Time Regulations (which include the right to paid holidays), the Part-time Workers (Prevention of Less Favourable Treatment) Regulations, the National Minimum Wage and anti-discrimination legislation all apply to ‘workers’, not just to ‘employees’.

13. Individuals will be treated as ‘workers’ (with tax and National Insurance deducted at source) unless the Director of Human Resources is satisfied that the arrangement is genuinely one of a contract for services  (ie self-employed) rather than a contract of services (see section on Self Employed Consultants).