26 October 2020

Universal Credit – New rules for people who are paid monthly

New rules are due to come into force from 16 November 2020 to help people who are paid monthly by their employer and receive two payments in the same UC assessment period.

DWP usually use information about people’s pay/earnings that is sent in to HMRC from employers. DWP use the date they receive the information from HMRC in order to allocate it to the relevant UC assessment period.  Sometimes, a person is paid early because their usual pay day falls on a weekend or bank holiday. In other situations a person may be paid on time but their employer may send the information to HMRC late. These actions can impact the date that the information is sent to DWP and therefore the UC assessment period it is allocated to. In some cases, where this happens close to the start or end of the assessment period, two sets of earnings can fall into the same assessment period.

Following the recent High Court ruling in the Johnson case, new legislation has been introduced to take effect from 16 November 2020.

The new rules mean that where it appears that two monthly salary/wage payments have been received in the same assessment period, DWP can reallocate one of the payments to a different assessment period to help maintain more regular payment patterns. This only applies to monthly paid employees and appears to be at the discretion of the DWP.

We are awaiting further information from DWP about what steps, if any, claimants should take to request this reallocation of their earnings information or whether DWP will apply the rules automatically. We are also waiting for further information about what will happen to people who have been affected by this issue and who have been waiting for the outcome of the Johnson case.

We will update the website with more detail when it becomes available.

SI 2020/1138 is available on the legislation.uk website .