To explain to you how you pay more NI if you’re a zero hours or temporary worker

[Tiredtiredtired100]

Inspired by another thread about maternity pay, NI contributions and student loans contributions.

NI and student loans contributions are calculated per pay packet and you pay whenever you go over the threshold amount for that pay packet (£184 per week for NI, or £794 per month).

SMP for example is below the weekly threshold amount so you wouldn’t pay any NI or contributions to student loans if it was paid weekly. If paid in one go, you appear to have earned 6k in a month and pay a lot of NI and Student Loan contributions. You cannot claim the NI back because it wasn’t incorrectly calculated.

This system is why all temporary, zero hours contracted and seasonal workers pay more NI than permanently employed staff with consistent hours, for the same wage. They earn more money in one pay packet than the next but NI contributions aren’t averaged out.

I wrote to the government about it in 2018 and received a letter in response saying that they knew about this but had no plans to change the system.

The government don’t give a damn that zero-hours, temporary and seasonal workers in all industries pay more NI than permanent staff and they get away with it because barely anybody realises.

If you want to figure out if you overpaid:

1. Go and look at your p60 if you’re a temporary, supply or zero-hours worker and look at how much NI you paid last year.

2. Then go and enter your gross salary into this website www.thesalarycalculator.co.uk/salary.php
   and see how much NI you should have paid if your salary was split evenly across the year.

As a supply teacher I paid £700 more NI in a year than I would have if I was permanently employed with my wage split over 12 months.

What sector do you work in?
How much more did you pay?

I'm zero hours and I pay more NI and tax on a good month. However I may pay no NI for 4 months so it balances out. For me anyways. I also usually get a taxi rebate every year.

@ GrandTheftWalrus but it doesn’t balance out as you wouldn’t pay as much NI if those earnings were split over 5 months. That’s my point. If your wages were consistent you would pay less NI.

Tax is averaged out so you can claim a rebate. NI is not, so you can’t.

Last year on my zero hours contract I paid 959 NI for the whole year. Surely it balances out when some months I don't pay any?

Hmm.. I went onto that website and I paid 100 more. But are NI contributions not for pensions etc?

@GrandTheftWalrus

Hmm.. I went onto that website and I paid 100 more. But are NI contributions not for pensions etc?

No. NI is a tax the same as normal income tax. The amount you pay is not ring fenced for your pension or any other benefit entitlement. They are based on how many months of contribution you make, not the actual amount, so thinking about it, being paid 6 months in one go, rather than say a smaller amount per month for six months, means you've lost 5 months of contributions. Hmmm

NI is an outdated system. They should abolish it and increase the tax rates, but they won’t.

If you have two part-time jobs, you pay less NI because you can earn 184 a week in each job before you pay NI.

@GrandTheftWalrus so £100 a year every year that you work. To me it’s just not fair that you pay more for “perk” of being a zero-hours worker when someone on a permanent contract pays less and also gets better sick pay, maternity benefits etc.

@JellyBabiesSaveLives I agree, but if they’re not going to abolish it they should at least make it fair.

You're bang on @Tiredtiredtired100 but most people seem unable to understand it. I've noticed that my NHS (below inflation) "payrises" always paid and backdated about 6 months into the relevant year. The extra NI on a workforce as large as the NHS must be a significant sum.

In the past my NI was calculated wrongly, it is virtually impossible to get back. Once the money is paid you are out of luck and pocket.

But someone here will know someone who thinks zero hours contracts are great so screwing over many workers is only fair

I'm on maternity leave right now and I'm getting the exact same as I did when I worked full time when I had my older dd. 6 weeks 90% pay then the rest smp with the last 3 months unpaid.

I know however I am lucky as a friend hadn't worked enough and only got maternity allowance for 6 months. Another friend isn't getting anything.