PIXIE PAYROLL Blog

Recently, the conversation around mental health has become much more open, with many high-profile people sharing their experiences but the subject remains hidden in some workplaces. Balancing work and home responsibilities can be very stressful but addressing mental health at work is important not just for the wellbeing of the employees but also for creating a supportive and productive culture. So as we reach quite a stressful time of year with Christmas on the horizon which is often coupled with bad weather and a busy workplace, we thought we’d look at how both employers and employees can prioritise mental health in this month’s blog.

What is workplace stress?

Employees can become stressed, anxious or depressed for many reasons, and not all will be linked to work, but factors such as a heavy workload, lack of support or a poor work culture can lead to poor mental health. It might be noticed that employees have symptoms including:

• Anxiety or worry
• Exhaustion
• Decreased productivity
• Being off sick more
• Making more mistakes or being unable to concentrate

Supporting good mental health at work

If an employee is starting to struggle, it is important to address the situation early on to prevent more severe mental health issues later. So it’s important for employers to create a culture where mental health is prioritised and this can be done in a number of ways:

Encourage openness – it is important that employees know they can raise issues about mental health, that they will receive an empathetic response and that they will feel supported.

Offer mental health resources – these might be workshops, mental health training or signposting to external support. Mental Health First Aid courses can be a really good way of helping employees support each other by spotting the early signs of distress.

Offer flexible working – it’s now the law that employers have to consider flexible working requests but granting them in good time can help support employees’ mental health. More remote working can help support a better work/life balance while varying an employee’s hours might alleviate stress in the short term.

Breaks are important – getting sufficient rest and time away from work is vital to mental health so employers should encourage their employees to take the leave they are entitled to. During a working day, simple things like getting outside for a walk and fresh air – especially at this time of year – or stopping for a stretch can really help an employee’s mood.

Build mental health into training – supporting managers to be good leaders is an important aspect of good mental health in the workplace so additional training specific to helping them support their teams’ mental health is valuable.

How can employees help themselves?

Everyone has a role to play in maintaining good mental health, and that includes employees – or even the self-employed – themselves. Speaking up when feeling overwhelmed, taking regular breaks, practicing mindfulness activities and simply eating well and exercising can all help workers cope with the inevitable stressful moments at work. Overall, creating a workplace that promotes good mental health is the responsibility of both employers and employees and a supportive culture at work will improve outcomes for everyone.

The long-awaited Budget Day is finally here; the first from the new Labour government and the first ever delivered by a female Chancellor of the Exchequer. Some of the measures in the speech today had already been announced but there were nevertheless some surprises and confirmation that there will be no changes to income tax, employees’ national insurance or VAT.

We have summarise some of the business, taxation and employment related measures in this blog post but you can find more information on everything announced today here https://www.bbc.co.uk/news/articles/cdxl1zd07l1o

National Insurance

We’ve quite often found ourselves starting a blog post discussing national insurance in recent years, and this budget is no exception. This time, however, there is no change to the rate that employees pay so workers shouldn’t see a change in their payslips. But the amount employers pay will be increasing in April – up from 13.8% on salaries above £9,100 to 15% on salaries above £5,000. It is estimated this will raise about £25bn a year.

In an effort to offset this for smaller employers, employment allowance will increase from £5,000 to £10,500.

Carers’ allowance

There has been a lot in the news recently about carers’ allowance and about how carers who inadvertently earn more than permitted have been penalised. The Chancellor announced today that the earnings threshold will increase to £195 per week which means carers can still be eligible for the benefit of around £81 a week even if they increase their working hours. There will also be a review into how overpayments are dealt with.

Wage and pension rates

The National Living Wage – the minimum paid to those over 21 – will increase to £12.21 from April; an increase of 6.7%. For those aged 18-20, the National Minimum Wage will rise to £10 per hour. The rate for apprentices will increase to £7.55 per hour.

The new and basic state pension will increase by 4.1% next year.

Income Tax thresholds

The income tax thresholds – the rate at which people start paying tax or move into higher tax bands – are currently frozen which means that more people pay more tax each year as their wages increase. There was speculation that this freeze would be extended but it was confirmed today that the thresholds will start to rise in line with inflation from 2028.

Other measures

Fuel duty will remain frozen and that freeze will be extended for a further year beyond April 2025.

£500m will be allocated to repair potholes in England and money will be made available for rail infrastructure projects. As a contrast, the cap on single bus fares will rise to £3.

There will be a new tax on vaping liquid and a review into the sugar tax on soft drinks. As is normal in a budget, the duty on tobacco and some alcoholic drinks will increase but will reduce on draught drinks such a beer served in pubs.

So, the first Budget is done and the plans of the new government are starting to become clear. If you need any help or information on what the increase in employers’ national insurance means to your payroll, just get in touch.

We posted on our Facebook page recently about sabbatical leave and how employers are increasingly offering it as a way to attract new employees. So we thought we’d take a closer look at the subject for this month’s blog.

What is a sabbatical?

The term originated in an academic setting and was used to describe the time academics took away from teaching for research or travel. But it’s been extended now to mean a period of long-term leave – usually unpaid – from a job for volunteering, travel or study, with the expectation that the employee’s job will be held open for them and that they will return to work, although there is no legal right for the employee to come back to their job.

The term ‘career break’ might also be used but this is usually when an employee resigns from their job although there is a promise to offer re-employment at the end of their break.

Legal status of sabbaticals

There is currently no legal right to take a sabbatical. That means that it’s entirely at the discretion of the employer as to whether a request for a sabbatical might be granted. If the option for a sabbatical is written into an employee’s contract, then it does become legally enforceable.

If an employee is on sabbatical and remains employed, then their rights under their contract are still in place. This includes the fact that they’ll continue to accrue holiday pay and they will be building months and years of continuous service. By contrast, if they’ve taken a career break and so are not employees during the time of their leave, they won’t enjoy any of the benefits of employment.

Granting a request for sabbatical leave

An employer’s first thought when receiving a request for sabbatical leave is the disruption it could cause to the business. The impact it will have will vary so it will be an individual consideration for each employer. Then there’s the financial impact. Sabbatical leave is typically unpaid so it could reduce payroll costs for a while, but this saving could be offset by the additional cost of covering for the absent employee.

But agreeing to a request for sabbatical leave can have benefits too. It can really help with staff retention and recruitment, meaning valued, talented and skilled staff remain in the business rather than leaving to join a competitor. It can also help to bring new skills into the business if the employee has taken the time out to study or train.

From an employee’s point of view, it can boost productivity and make them feel rewarded for hard work and long service.

Writing a sabbatical policy

If an employer is thinking about offering sabbaticals, it would be a good idea to start by writing a sabbatical policy that sets out the criteria for granting a request. These might encompass length of service, seniority or maximum length of the sabbatical. A clear policy will help to make sure any requests are considered fairly and avoid complaints about discrimination.

Offering sabbaticals can have benefits for both employers and employees but there are drawbacks too so it’s something that needs quite a bit of consideration and requests will probably need to be considered on a case by case basis. But it’s definitely a subject that will be coming up more and more in the future.

The cost of living crisis has seen a huge shock to people’s household finances in recent years and there are signs that wage growth has begun to help people manage better as they’re faced with bigger bills. But there will still be some who are struggling and so employers may find themselves having to respond to employees asking for a pay rise and in this month’s blog, we’ve got a few handy tips on how to deal with that.

Be open to the request

It is important to initially be open to the employee’s request for a pay rise – it’s important to remember that it might have come out of the blue for the employer but the employee is likely to have been stewing on it for many weeks and will be anxious. Don’t say ‘no’ immediately but reassure the employee they will be given the time to explain why they think they deserve a pay rise.

Avoid a stressful situation

Those weeks of stewing may have caused the employee to have built up a list of grievances and reasons as to why they don’t feel valued and airing them at this point might not be the most productive thing to do. So maybe plan for the initial meeting to be short – confirm the request will be given consideration and set a future meeting date to discuss it further so both parties have the time to prepare. Ensure the employee is clear about the expectations for the future meeting.

Do some benchmarking

It’s a good idea for employers to undertake regular benchmarking exercises to ensure they are paying their staff at a level comparable to their competitors. But if the employer has received a pay rise request, it’s worth just doing a quick salary comparison so they are armed with up to date information for the meeting.

Undertake a performance review

If the employee is requesting a pay rise, it is likely that they believe they have been performing well – perhaps undertaking additional responsibilities, working longer hours or generating income. But it would be good for the employer to look into this so they can be sure that any extra effort is appropriately rewarded. This is also important should another employee request a pay rise who perhaps hasn’t been working this hard and will allow for that situation to be managed appropriately.

Other options

Budget restrictions might mean that a pay rise isn’t possible but if the employer values the employee and the work they’ve been doing, there might be other ways to reward the employee. Flexible working might be something they are interested in or perhaps some additional holiday time. If business considerations allow it, could the employee be offered a shorter working week for the same salary?

Discussions about pay rises are always tricky and they can’t always have a positive outcome even if it’s what everyone wants. But by taking the request seriously, giving the employee the space to air their issues and explore options offers a great chance of a satisfactory conclusion.