What is going on? Read More
On April 6th 2016 the Finance Bill will be released and with it will come dramatic changes in the travel and subsistence pay for temporary workers in the UK.
Many temporary workers who are employed through an employment intermediary may suddenly find that their current lifestyle is about to undergo a drastic change.
So who exactly will be affected?
Any temporary workers who are working through an employment intermediary like an umbrella company or a recruitment agency who are claiming tax relief on subsistence and travelling to and from the place of work using public transportation (buses, trains, or the Tube).
What does this actually mean for these workers?
To simplify it, temporary workers who are currently claiming travel and subsistence benefits will no longer be able to claim this from April 6th 2016.
They will have to pay for their own public transport costs and will not be reimbursed for these expenses by the Government anymore.
What are the consequences of this to the worker?
These workers will have an overall ‘reduction’ in their net pay. If the travel expenses are not being covered by the Government, then it will come out of the workers’ own pockets.
This can be particularly detrimental to workers who are currently doing long commutes to work and who are already earning low pay rates and who may not be able to afford any further reductions in pay.
Are there any exceptions?
Only one. If a worker under the conditions above was to work in a different location from where they normally work for a one-off assignment then they would be open to claiming his/her travel costs as a 'business expense'.
This is based on the premise that this is an irregular activity which rarely occurs.
What does this mean in the long term?
Workers may be dissuaded from potentially taking on long commutes to work if they believe that this will now take a sizeable bite out of their earnings.
It will reduce the opportunities which are now viable for many temporary workers who depend on travel and subsistence pay to reach their areas of employment.
What does the industry think of this change?
-April 2016 marks a monumental shift in the world of temporary recruitment and may make employment for the average temporary worker more difficult than ever before.
-Unfortunately, through no fault of their own, workers may find that their take home pay will substantially reduce just because of their choice to use public transport to get to work.
-Simply put, it means that come this April a large proportion of the UK temporary workforce will be forced into reconsidering their current employment situation.
So what can you do about it?
To find out whether you will be affected by the legislation changes feel free to call Goldteam Recruitment on 0333 444 0222 to see whether we can assist you in finding a more cost-effective alternative to your employment situation. Let’s talk!Read Less