Under current rules, workers who are paid twice are reported as “over-earning” in the DWP systems. This means that their next payment is reduced – sometimes to zero – to reflect their higher income.
But in the majority of cases, they don’t win at all.
Often times, this is because their employer paid them on the first or last working day, or they received a late or early payment due to a public holiday.
This loophole often leaves vulnerable families without benefits for an entire month. In the majority of cases, part of the ‘double payment’ will be written off on their next payment due to the reduction rate which is set at 63p for every £ 1.
In June, four single moms took the case to the Court of Appeal – and won.
Mom Danielle said she experienced significant fluctuations in her benefit income due to a “conflict” between her monthly paydays and the DWP’s fixed monthly universal credit reporting periods.
Between them, the four mothers had rent arrears, did not pay council tax, incurred bank overdraft fees, borrowed money and even became dependent on food banks to join the two. ends.
The judge concluded that the “irrational and unfair” system pushed them into poverty and forced them to rely on food banks.
The DWP has been ordered to correct the flaw – and has now confirmed that the new rules will take effect in November.
He said that from November 16, the benefit system will only record one payment for each assessment period to prevent anyone from losing.
The responsibility for manually moving the payday will always rest on Universal Credit, although the applicant is recommended to notify their work coach in advance if possible through their online journal.
It will be based on the employer’s real-time information (RTI), which means you won’t have to do anything more.
The changes will take effect on November 16 and will benefit workers during the holiday season who are paid early due to the Christmas holidays.
But this will only apply to employees who are paid monthly, so will not help those who are paid weekly or fortnightly.
Peter Tutton, Policy Manager at StepChange, welcomed the change but added: “It is also important that DWP continues to look for ways to stabilize payments for those who are facing similar issues, such as those who are paid to weekly or bi-weekly or who have an irregular income. . ”
Social Assistance Minister Will Quince said, “Universal credit is a flexible benefit, and we continue to make changes and improvements to make sure people have the best possible experience.
“This change will give people stability if they are paid two paychecks in a single appraisal period, ensuring that their Universal Credit payments remain consistent. “