With the updated guidance from HMRC employers can allow employees to participate in a salary sacrifice scheme even if it will bring them below National Minimum Wage without being penalised.
How to manage this option in SmartPay™?
Clients with the respective role (SmartPay Master Administrator or SmartPay Product Administrator) can the option switch on/off in SmartPay for each salary sacrifice at any time following the steps below:
- Navigate to SmartPay in Reward Manager
- Click on "Products"
- Choose the product to switch it on/off for
- Find "National Minimum Wage and Underpayments" section
- Switch it on/off for the product
- Once saved it is applied immediately to all future requests for this product
What does it mean if the option is switched on for a product?
Employees will be able to complete the application form even if the requested amount brings them below National Minimum Wage.
- Employees will complete their applications and be warned that it may take them below NMW,
- Employees must give their consent that they are happy to proceed with their application and that deductions may take them below NMW/NLW
- Applications will remain as pending in SmartPay for Employers to review and approve or reject accordingly.