What is a Court Order?
A court order is a statutory deduction that an employer must take from their employee's pay if they receive an order to do so.
The table below shows the types of court orders that exist, what they are for and who issues them.
Employer Responsibilities
It is the employer's responsibility to:
Deduct the court order from the next available payroll run.
Pay the issuing authority in line with the payment schedule provided.
Show the deduction clearly on the employee's payslip.
Knowing how much to deduct
Each type of order includes the amount or percentage to be deducted, and what net earnings to apply the deduction to. This is to facilitate manual calculations for each monthly deduction. However, PayFit automatically calculates the correct earnings and rates for each court order deduction. Simply add the details of the court order and PayFit will calculate the monthly deductions due until the court order has been paid in full.
Feature overview
✅ PayFit will automatically calculate the amount that the employee is due to pay based on the parameters inputted by the admin.
✅ Admins are able to add up to two active court orders per employee.
✅ If you don't agree with PayFit's calculation, you are able to add a fixed amount deduction instead (though this functionality is discouraged unless you're trying to match previous payslips).
❌ Court order workings aren't shown in the payslip breakdown so if you'd like to provide a calculation breakdown to the employee, please contact your customer care manager who can help you with the calculation.
❌ Court orders will show as 'cancelled' rather than deleting altogether from the admin space.
❌ Court orders can't currently be synced via our HR integrations.
Adding a court order
From the employee's record, click the Pay Items tab.
Click Enable more pay items.
Toggle on the Court orders option, then click Save.
Under the Court orders section, click Add court order.
Complete the relevant fields using the document issued to you by the court, then click Save.
The deduction amount is calculated automatically each month until either the total amount has been repaid, or the end date on the court order has been reached. The court order deduction appears on the employee's payslip
Paying the issuing authority
To check how much to pay to the issuing authorities, simply run the Court orders report. To do this:
From the left, choose Post-payroll checklist.
Under the Payments to make section, click Court orders.
The report displays any court orders, including the amount to pay, and who to pay it to. This can also be downloaded as a PDF, CSV or Excel file.
FAQs
Can I deduct an admin fee for managing the employee's court order?
If you wish, you can choose to deduct an additional £1 from your employee in order to cover administration costs. This shows separately on the employee's payslip. When setting up the court order, from the Admin fee drop-down, select £1.
What if my employee disputes their court order?
In general, the court order needs to be actioned from the next available payroll. If the employee disputes their court order, the employer should contact the issuing authority once they receive the letter to ask if they are still to make the deductions and follow the instructions they're given - failing to do so could result in the company getting fined.
Can I reduce the deduction if the employee is unable to afford it?
The employer has a legal obligation to fulfil each month's contribution in line with the order. The app auto calculates the deduction amount in line with government guidance so this shouldn’t be adjusted without good reason.