The Employment and Support Allowance Regulations 2013

Earnings of employed earners

80.—(1) Subject to paragraphs (2) and (3), “ earnings” means, in the case of employment as an employed earner, any remuneration or profit derived from that employment and includes—

(a) any bonus or commission;

(b) any payment in lieu of remuneration except any periodic sum paid to a claimant on account of the termination of the claimant’s employment by reason of redundancy;

(c) any payment in lieu of notice;

(d) any holiday pay except any payable more than four weeks after the termination or interruption of employment;

(e) any payment by way of a retainer;

(f) any payment made by the claimant’s employer in respect of expenses not wholly, exclusively and necessarily incurred in the performance of the duties of the employment, including any payment made by the claimant’s employer in respect of—

(i) travelling expenses incurred by the claimant between the claimant’s home and place of employment;

(ii) expenses incurred by the claimant under arrangements made for the care of a member of the claimant’s family owing to the claimant’s absence from home;

(g) any award of compensation made under section 112(4) or 117(3)(a) of the Employment Rights Act 1996 (the remedies: orders and compensation, enforcement of order and compensation)(1);

(h) any payment made or remuneration paid under sections 28, 34, 64, 68 and 70 of the Employment Rights Act 1996 (right to guarantee payments, remuneration on suspension on medical or maternity grounds, complaints to employment tribunals)(2);

(i) any such sum as is referred to in section 112(3) of the Contributions and Benefits Act (certain sums to be earnings for social security purposes)(3);

(j) where a payment of compensation is made in respect of employment which is part-time employment, the amount of the compensation;

(k) the amount of any payment by way of a non-cash voucher which has been taken into account in the computation of a person’s earnings in accordance with Part 5 of Schedule 3 to the Social Security (Contributions) Regulations 2001(4).

(2) “Earnings” are not to include—

(a) subject to paragraph (3), any payment in kind;

(b) any remuneration paid by or on behalf of an employer to the claimant in respect of a period throughout which the claimant is on maternity leave, paternity leave or adoption leave (which means a period of absence from work on ordinary or additional adoption leave under section 75A or 75B of the Employment Rights Act 1996(5)) or is absent from work because the claimant is ill;

(c) any payment in respect of expenses wholly, exclusively and necessarily incurred in the performance of the duties of the employment;

(d) any occupational pension (which means any pension or other periodical payment under an occupational pension scheme but does not include any discretionary payment out of a fund established for relieving hardship in particular cases);

(e) any lump sum payment made under the Iron and Steel Re-adaptation Benefits Scheme(6);

(f) any payment in respect of expenses arising out of the claimant participating as a service user.

(3) Paragraph (2)(a) is not to apply in respect of any non-cash voucher referred to in paragraph (1)(k).

(4) In this regulation—

“compensation” means any payment made in respect of, or on the termination of, employment in a case where a claimant has not received or received only part of a payment in lieu of notice due or which would have been due to the claimant had that claimant not waived the right to receive it, other than—

(a)

any payment specified in paragraph (1)(a) to (i);

(b)

any payment specified in paragraph (2)(a) to (f);

(c)

any redundancy payment within the meaning of section 135(1) of the Employment Rights Act 1996;

(d)

any refund of contributions to which that person was entitled under an occupational pension scheme; and

(e)

any compensation payable by virtue of section 173 of the Education Reform Act 1988(7);

“paternity leave” means a period of absence from work on ordinary paternity leave by virtue of section 80A or 80B of the Employment Rights Act 1996(8) or on additional paternity leave by virtue of section 80AA or 80BB of that Act(9).

(5) The reference in paragraph (2)(f) to a person participating as a service user is to—

(a) a person who is being consulted by or on behalf of—

(i) a body which has a statutory duty to provide services in the field of health, social care or social housing; or

(ii) a body which conducts research or undertakes monitoring for the purpose of planning or improving such services,

in the person’s capacity as a user, potential user, carer of a user or person otherwise affected by the provision of those services; or

(b) the carer of a person consulted under sub-paragraph (a).

(1)

1996 c.18. Section 112(4) was amended by paragraph 36 of Schedule 7 to the Employment Act 2002 (c.22), section 8 of the Public Interest Disclosure Act 1998 (c.23) and Schedule 9 to the Employment Relations Act 1999 (c.26). Section 117(3)(a) was amended by paragraph 37 of Schedule 7 to the Employment Act 2002, section 8 of the Public Interest Disclosure Act 1998 and Schedule 9 to the Employment Relations Act 1999.

(2)

Sections 34 and 70 were amended by section 1 of the Employment Rights (Dispute Resolution) Act 1998 (c.8) and S.I. 2011/1133. Section 64 was amended by S.I. 1999/3232.

(3)

Section 112(3) was amended by paragraph 51 of Schedule 1 to the Employment Rights Act 1996.

(4)

S.I. 2001/1004.

(5)

Section 75A was inserted by section 3 of the Employment Act 2002 and amended by paragraph 33 of Schedule 1 to the Work and Families Act 2006 (c.18). Section 75B was inserted by section 3 of the Employment Act 2002 and amended by paragraph 34 of Schedule 1 to the Work and Families Act 2006.

(6)

The Scheme is set out in regulation 4 of, and the Schedule to, the European Communities (Iron and Steel Employees Re-adaptation Benefits Scheme) (No.2) Regulations 1996/3182.

(7)

1988 c.40. Section 173 was amended by Schedule 3 to the Employment Rights Act 1996.

(8)

Section 80A was inserted by section 1 of the Employment Act 2002 and amended by paragraph 35 of Schedule 1 to the Work and Families Act 2006. Section 80B was inserted by section 1 of the Employment Act 2002 and amended by paragraph 36 of Schedule 1 to the Work and Families Act 2006.

(9)

Section 80AA was inserted by section 3 of the Work and Families Act 2006. Section 80BB was inserted by section 4 of the Work and Families Act 2006.