The Trade Union (Levy Payable to the Certification Officer) Regulations 2022

Determination of the levy

5.—(1) The Certification Officer must determine the amounts to be levied and paid by relevant organisations in respect of a financial year in accordance with this regulation.

(2) No levy is payable by a relevant organisation that is not a qualifying relevant organisation.

(3) The levy payable by a qualifying relevant organisation in respect of a financial year is—

(a) the basic levy determined in accordance with paragraph (9), but subject to paragraph (11);

(b) if applicable, the categorised additional levy determined in accordance with paragraph (10), but subject to paragraph (12);

(c) if applicable, the enhanced levy determined in accordance with paragraph (14).

Step 1 – determine the total levy

(4) The Certification Officer must determine the total levy, and in doing so—

(a) must have regard to the total amount of relevant expenses, incurred or to be incurred by the Certification Officer in respect of the financial year to which the levy relates;

(b) may take into account estimated as well as actual relevant expenses, where the determination occurs before the end of that financial year;

(c) must aim to ensure that the total amount levied over any period of three financial years does not exceed the total amount of the Certification Officer’s relevant expenses over that period; and

(d) must not take into account any shortfall in the amount of levy collected in respect of any earlier financial year which arises from the circumstances set out in regulation 7(3).

Step 2 – apportion the total levy between the categories of relevant organisation

(5) The Certification Officer must apportion the total levy between the categories of relevant organisation, based on the relevant expenses that the Certification Officer considers are broadly referable to functions exercised, or to be exercised, in relation to that category for the financial year.

(6) In making that apportionment, the Certification Officer may decide that there is a proportion of the total levy which is to be attributed to all qualifying relevant organisations equally, on the basis that there is an equivalent proportion of relevant expenses which cannot reasonably be referred to any of the respective categories of relevant organisation; and if the Certification Officer so decides, that proportion of the total levy is the “basic amount”.

(7) Any difference between the total levy and the basic amount is the “additional amount”.

(8) Each proportion of the additional amount which is apportioned to a category of relevant organisation is a “categorised additional amount”.

Step 3 – Determine the basic levy

(9) The Certification Officer must divide any basic amount equally between all qualifying relevant organisations; and the resulting amount is the “basic levy”.

Step 4 – Determine each categorised additional levy

(10) The Certification Officer must divide each categorised additional amount equally between all qualifying relevant organisations in the relevant category; and each resulting amount is a “categorised additional levy”.

Step 5 – Identify relevant organisations which will be exempt from any basic levy

(11) The Certification Officer must exempt from payment of any basic levy in respect of the financial year all qualifying relevant organisations for which the basic levy would exceed 2.5 per cent of their annual income.

Step 6 – Identify relevant organisations which will be exempt from any categorised additional levy

(12) The Certification Officer must exempt from payment of any categorised additional levy in respect of the financial year all qualifying relevant organisations for which the aggregate of any basic levy and any categorised additional levy would exceed 2.5 per cent of their annual income.

Step 7 – Calculate the levy shortfall

(13) The Certification Officer must—

(a) multiply the basic levy by the total number of qualifying relevant organisations, other than those exempt from the basic levy under paragraph (11);

(b) multiply each categorised additional levy by the number of qualifying relevant organisations in the relevant category, other than those exempt from that categorised additional levy under paragraph (12); and

(c) calculate the difference between the total levy and the aggregate of the amounts calculated under sub-paragraphs (a) and (b), that difference being the “total levy shortfall”.

Step 8 – Determine the enhanced levy

(14) The Certification Officer must divide and allocate the total levy shortfall equally between all qualifying relevant organisations, other than those—

(a) exempt under paragraph (11) from payment of the basic levy;

(b) exempt under paragraph (12) from payment of any categorised additional levy; or

(c) for which the aggregate of any basic levy, any categorised additional levy and any amount so allocated would exceed 2.5 per cent of their annual income.

(15) The amount so allocated to each qualifying relevant organisation under paragraph (14) is the “enhanced levy”.

(16) Where a qualifying relevant organisation ceases to exist, after the relevant date but before the Certification Officer determines the levy in accordance with this regulation, by virtue of an amalgamation or transfer of engagements under Chapter VII of Part I of the 1992 Act, the levy which would otherwise be payable by that qualifying relevant organisation is payable by the relevant organisation that is the successor to that qualifying relevant organisation, in addition to any other amount of levy payable by that successor.

(17) Where a qualifying relevant organisation ceases to exist, after the relevant date but before the Certification Officer determines the levy in accordance with this regulation, other than by virtue of an amalgamation or transfer of engagements under Chapter VII of Part I of the 1992 Act, that qualifying relevant organisation is not to be treated as a qualifying relevant organisation for the purposes of the determination of the levy in accordance with this regulation and the Certification Officer must leave that qualifying relevant organisation out of account in the determination of the levy payable by other qualifying relevant organisations.