With the effects of the latest Royal Bank of Scotland banking crises still affecting Ulsterbank customers in Northern Ireland, we ask what employer’s obligations are with regards to paying their employees, and more importantly, what can employers do to help reduce the impact?

The starting point for employers is to look at your contract of employment to see if you specify a contractual date upon which payment must be made or look at custom and practice. If you have a contractual payment date and your Payroll is implemented by Ulsterbank then your employees may face a delay before they receive their wages. This could leave you in breach of your contract and employees could pursue you for any losses they suffer as a result of the delay e.g. bank fees and borrowing interest rates.

Ulsterbank have confirmed:
• that if there are regular payments into an account they will honour any direct debits;
• if customers take their payslips or proof of income into a branch that they can access their funds;
• they will reimburse all customers of any fees or costs they incur as a result of the banking error.

I would advise employers to be pro-active if they anticipate problems and inform employees of the above points perhaps by issuing a memo and placing it on a communal notice board or by attaching it to their pay slips.

If employees’ approach you to recover any losses they suffer it may be prudent in the first instance to ask them to approach Ulsterbank. If they are not a customer of Ulsterbank then it may be the case that you may need to approach Ulsterbank to look to recoup their losses from them.

I would encourage all employers not to make any rash decisions and to contact the advice line for guidance on the particular issues that they come across before making any payments.

If you require any further information on the process of redundancy please do not hesitate to contact the advice line on 0844 892 2786.