HC Deb 06 February 1997 vol 289 cc713-4W
Mr. Rooney

To ask the Secretary of State for Social Security (1) what final payments to an individual by an employer on termination of employment are taken into account when assessing entitlement to (a) contribution-based and (b) income-based jobseeker's allowance; [14601]

(2) how payments in lieu of notice affect entitlement to (a) contribution-based jobseeker's allowance and (b)income-based jobseeker's allowance. [14602]

Mr. Roger Evans

Payments made on Termination of Full-time Work—16 hours or more a week.

Normal earnings, expenses and any earnings held "in hand" which are paid on termination of employment are ignored when assessing entitlement to contribution-based and income-based jobseeker's allowance.

Compensation payments, for example pay in lieu of notice or remuneration, made in respect of the termination of the employment, and holiday pay payable at termination, have the effect of treating the individual as continuing to be in full-time work after the termination of employment. Neither contribution-based nor income-based jobseeker's allowance is payable after the termination for a period equivalent to that for which the compensation or holiday pay has been paid.

Payments made under employment protection legislation for unfair dismissal, or under trades union legislation for unfair dismissal or redundancy on grounds of involvement in trade union activities, are taken into account as earnings in contribution-based and income-based jobseeker's allowance, subject to the appropriate disregard, normally £5 a week. They are taken into account for a period equivalent to that for which the payments has been made.

Lump sum redundancy payments and holiday pay payable more than four weeks after the termination of the employment are treated as capital and do not affect contribution-based jobseeker's allowance. Income-based jobseeker's allowance is affected only if the total capital held by the individual and his family is more than £3,000.

Payments made on Termination of Part-time Work—less than 16 hours a week.

Normal earnings, expenses and any earnings held "in hand" which are paid on termination of employment are ignored when assessing entitlement to contribution-based and income-based jobseeker's allowance.

Compensation payments, holiday pay payable at termination, and payments made under employment protection or trades union legislation are taken into account as earnings in contribution-based and income-based jobseeker's allowance, subject to the appropriate disregard, normally £5 a week. They are taken into account for a period equivalent to that for which the payment has been made.

Lump sum redundancy payments and holiday pay payable more than four weeks after the termination of the employment are treated in the same way as on termination of full-time work.