Universal Credit and monthly paid wages
Universal Credit awards can be affected at certain times during the year if you receive your wages paid monthly – an automated solution is on the way, but for now speak to your work coach if this could impact you.
If your earnings are paid monthly, there may be times during the year when you receive two payments of wages during one Universal Credit assessment period. This could be because you are paid on the last working day of the month, or because your usual pay day falls on a weekend or bank holiday and so is brought forward.
In these cases it appears to Universal Credit as if you have earned much more than you normally would, and therefore will mean that you get a smaller Universal Credit award, or could be the case that your extra payment of wages means that you earn enough that month to receive no Universal Credit at all.
This problem has been caused by the way Universal Credit uses fixed dates for the assessment periods and has been recognised by government as having the potential to cause hardship to families who have their Universal Credit award reduced when they haven’t actually earned any more than they usually would. The Government passed legislation in November 2020 to provide a solution.
If this affects you in a particular assessment period, you should contact your work coach as soon as possible, through your online journal, to ask them to change the date they apply one of the two payments to a different assessment period. This will help ensure that your Universal Credit award is based only on the income that actually relates to that assessment period.
It is hoped that later in 2021 the mechanism will be in place so that Universal Credit will automatically identify when two monthly wages have been received in this way and be able to correct the Universal Credit award before it is paid, without the claimant having to raise the issue with their work coach.
This solution only applies if your employer pays you on a calendar monthly basis. You will not be able to change the date your wages are assessed in this way if you are paid every 1, 2 or 4 weeks, even if your Universal Credit awards are periodically affected in a similar way.
For further information
If this affects you contact your work coach, via your online journal, as soon as possible.
If you wish to find out more about what financial support you may be entitled to, contact our Family Benefits Advice Service for free, impartial and confidential advice on Freephone 0800 028 3008 or email email@example.com.