Working Directors are a special category of employee in the Scheme and the definition of “Ordinary Rate of Pay” poses particular problems in regard to the treatment of Working Directors.
The contribution rate is based on the ‘ordinary rate of pay’ paid to an employee for ordinary hours which are 38 hours per week.
For Working Directors the ‘ordinary rate of pay’ is the rate of pay being received by Directors as employees of their firm. This would be the amount that they draw down as wages on a defined, regular, at least monthly basis, that they pay tax on a PAYG basis for, have wage records for and are issued a PAYG Group Certificate at the end of each financial year for.
One off adjustments during or at the end of the financial year are not included, nor can they be averaged out over the year, and salary sacrificing sums are also not included for income purposes.
Working Directors who do not draw a regular wage cannot then meet these requirements and their status in the Scheme is in doubt.
Working Directors who are in this situation or are unsure of these arrangements should contact MyLeave to discuss the matter.
Quarterly Returns are only to record service days when Working Directors are on site and working in a prescribed classification.