× Search rightsnet
Search options

Where

Benefit

Jurisdiction

Jurisdiction

From

to

Forum Home  →  Discussion  →  Work capability issues and ESA  →  Thread

ESA: Permitted Work - How weekly Income is calculated?

DDP
forum member

The Terrence Higgins Trust

Send message

Total Posts: 102

Joined: 7 September 2010

I need some help with a claimant who is doing permitted work at present.

He has been undertaking permitted work higher limit for a number of years. He works between 1-5 sessions per month and states that the work flow is irregular. A session last for 10 hours. The claimant is paid monthly.

Because the number of sessions per month varies, the claimant’s income varies each month.

We note that in order to determine the weekly income it is necessary to:

- Work out the period covered by the income;
- Work out the date from which to start taking the income into account;
- Convert income into a weekly amount if necessary.

With regard to the “period covered by the income” the rules state – if a payment of income is made for an identifiable period, it is taken into account for a period of equal length. So if you are paid monthly, the payments are taken into account for the number of weeks between the date you are treated as having been paid and the date you are next due to be paid.

The general rule for converting income into a weekly amount is:

- If the payment is monthly, multiply by 12 and divide by 52.

However, Regulation 79 (5), The Employment and Support Allowance Regulations 2013 states:

(5) Where the amount of the claimant’s income fluctuates and has changed more than once, or a claimant’s regular pattern of work is such that the claimant does not work every week, the foregoing paragraphs may be modified so that the weekly amount of the claimant’s income is determined by reference to the claimant’s average weekly income—
(a) if there is a recognisable cycle of work, over the period of one complete cycle (including, where the cycle involves periods in which the claimant does no work, those periods but disregarding any other absences);
(b) in any other case, over a period of five weeks or such other period as may, in the particular case, enable the claimant’s average weekly income to be determined more accurately.

The claimant’s “income fluctuates and has changed more than once”?

For example his pay is:

25/07/15 £263.30
25/08/15 £75.00
25/09/15 £46.00
25/10/15 £646.04
25/11/15 £578.00
25/12/15 £346.80
25/01/16 £346.80

Given that the claimant’s sessions vary each month there would appear to be no “recognisable cycle of work”. Is this a reasonable finding?

Can he then argue that paragraph (b) is applicable? More importantly can he argue “such other period as may, in the particular case, enable the claimant’s average weekly income to be determined more accurately”?

So the payments for 25/10/15 and 25/11/15 would of themselves mean that the claimant’s income for those 2 months be above the permitted work threshold. However, if his income over the entire period were taken into account then it would fall below the threshold and not result in non-entitlement and an overpayment.

Dan_Manville
forum member

Mental health & welfare rights service - Wolverhampton City Council

Send message

Total Posts: 2262

Joined: 15 October 2012

I had a similar case recently; depending when you started counting the claimant might, or might not, have exceeded the PWL. DWP initially took individual weekly periods where he exceeded and notified tan O/P for those weeks; I suggested that they might use an annual figure which they jumped at, however the year I was looking at differed from the year they chose to look at and the overpayment gathered a couple of zeroes. Doh!

There is a substantial discretion in how they assess these cases so my best advice would be to keep a running tally and try to make sure the average never goes above the PWL however looking at those figures I’d not be too worried as months over the PWL are scant.

[ Edited: 4 May 2017 at 02:42 pm by Dan_Manville ]
DDP
forum member

The Terrence Higgins Trust

Send message

Total Posts: 102

Joined: 7 September 2010

Hi Dan,

Thanks for your reply.

What persuaded them to take into account a longer period?

if anyone else has any thoughts on the Regulations or any similar experiences then please let us know.

Dan_Manville
forum member

Mental health & welfare rights service - Wolverhampton City Council

Send message

Total Posts: 2262

Joined: 15 October 2012

DDP - 02 May 2017 05:26 PM

What persuaded them to take into account a longer period?
.

gulp…

I did.

I said “take it over a year and it won’t hit the threshold” so they took it over a different year when it did hit the threshold.

It’s all sorted now thanks to a sensible Tribunal but it’s been a rocky road.

DDP
forum member

The Terrence Higgins Trust

Send message

Total Posts: 102

Joined: 7 September 2010

Thanks Dan.

If anyone else has any thoughts or experiences around the treatment/calculation of weekly income I would be grateful for your input.

Peter Turville
forum member

Welfare rights worker - Oxford Community Work Agency

Send message

Total Posts: 1659

Joined: 18 June 2010

ESA is a weekly benefit. Hence Reg 94(1)(a) provides the starting point of weekly. But (6) provides the ‘flexibility’ of using a different period as quoted above. Sub-para (ii) provides for the period of 5 wks before the claim or supersession decision - however in many cases PW may have started long after the date of claim or a supersession decision so the ‘or such other period’ is the only applicable option within (ii) in practice. 

Equally Reg 45 provides a similar provision for calculating the hours limit. 45(8) being the similar provision to 94(6)for fluctuating hours.

So, at least in theory, a DM could use one period for calculating average hours and another for earnings!

I had a permitted work overpayment case at tribunal last week for a client who was doing casual work as a nurse through an agency & was weekly paid. But DWP took an average over a period of 22 wks client had done work for the agency. The judge commented that the DWP had given no reasons for using a period of 22 wk period under the Regs. Concluding that as weekly paid weekly was the obvious approach (and most advantageous as it happened to my client). As the tribunal allowed the appeal for another reason it did not need to make a decision on applying Regs 45 & 94.

In you clients case as paid monthly a monthly period for calculating earnings and hours would appear the most logical (although quaterly or annually have merit!). Although this does mean the number of benefits weeks over which those earnings / hrs are taken into account each month could be 4 or 5 each depending on the calender etc.

The problem with undertaking variable / casual / zero hrs work under permitted work is it is a crystal ball gazing issue. Given the flexibity within the Regs on what period is most appropriate / helpful to client and what period will a DM use in practice - when in some cases the most suitable can only be determined with hindsight! As my client found out!

DDP
forum member

The Terrence Higgins Trust

Send message

Total Posts: 102

Joined: 7 September 2010

Thanks for your reply.

That is very helpful.