Where did that come from? New court order goes live with no payroll software to support it!

With massive thanks to my devolution guru, Ian Holloway Head of Legislation and Compliance at Cintra HR & Payroll Services, I wanted to share with you news of Collection Orders being sneaked in by the Department of Justice (DoJ) in Northern Ireland.

Despite the Northern Ireland Assembly being in abeyance, the DoJ have used powers in the Justice Act (Northern Ireland) 2016 to introduce the new orders effective from 1 June 2018 under The Enforcement of fines and other penalties Regulations (Northern Ireland) 2018 and The Social Security (fines)(deductions from benefits) Regulations (Northern Ireland) 2018 which cover how state benefits can also be reduced to collect the fines that are in scope.

The orders are similar in their scope to the Schedule 5 Fines Orders that were introduced in 2006 but only apply in England and Wales, in that they cover the collection through payroll of:

  • Court imposed fines
  • Compensation orders
  • The offender levy
  • Court costs
  • Fixed penalties and penalty notices
  • Fines transferred from other jurisdictions
  • Jurors’ fines

The new orders will be administered by a new part of the Department of Justice, the Fines Collection and Enforcement service (FCS). They will be referred to an attachment of earnings order as that indicates that collection will be via payroll.

As there has been absolutely no consultation or advanced warning about the new court order, no payroll software will have the facility to handle Collection Orders. Fortunately, and who knows if this is by design or accidental, the earnings’ bands and deduction percentages are exactly the same as a standard rate Direct Earnings Attachment (DEA) issued by the DWP (which incidentally do not operate in Northern Ireland), as Social Security matters are devolved to Northern Ireland and they have chosen not to implement DEAs to collect overpaid state benefits. This will allow employers to input a Collection Order as a standard rate DEA with the certainty that the correct deduction will be applied to attachable earnings, however the payslip description would be incorrect is it will show as a DEA when it ought to be a Collection Order, does your payroll software allow you to amend the description of deduction elements shown on payslips?

Statutory guidance is available here which covers how to action orders, where to pay the funds to (the Northern Ireland Courts and Tribunal Service) and what will happen to an employer if they fail to act on an order.

Thanks Ian, for alerting us to yet another payroll obligation: court order number 18! Hopefully now you have brought it to the software community’s attention we will be able to action these orders correctly from April 2019.