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Group Income Protection Payments
I have a client who has had a work related accident and is receiving £594 month from a Group Income Protection Payments. This is paid to his employer by a company called Unum and then his employer (Sky) passes this payment on to him. According to the Unum website, because the payment is not paid directly to the employee, it can be ignored for ESA purposes. My client is in fact receiving ESA(IR) and CTC and for both these benefits this income is being disregarded.
Before he received ESA(IR) his income had to be assessed for HB purposes and they decided to take it into account as earnings. When I spoke to them about this decision they commented that it was a very unusual situation and after much discussion they had based their decision on how a tribunal judge would treat this income.
I am surprised that there is such an inconsistency between means tested benefits and how they treat this type of income. Has anyone got any further information regarding Group Income Protection Schemes?
I don’t profess to have any knowledge of these kind of payments but a quick poke-about on the Unum website implies these are earnings replacement benefits paid when an employee is on long-term sick. I would assume (but aren’t entirely sure) that your client remains technically an employee of the company he was working for as a result?
As such, I think these payments would be taken into account under reg.95 of the ESA regs 2008, as earnings. In particular, reg.95(1)(e) makes it clear that any payment by way of a retainer is to be taken into account, which is a term used by Unum in relation to these payments. The schedule on disregarded earnings also makes it clear these payments can’t be disregarded (sch.7 para.1(1)(a) and para 2(a)(i).
If he isn’t an employee any longer, I’m still puzzled as to how regular payments of income would fall to be disregarded under the relevant schedule.
The big question that struck me is, has he declared these payments on his ESA claim form? If he has, I’d be very interested to understand why they’re being ignored.