IPP: 1 in 10 do not understand their payslips in full

Almost one in ten workers (9%) say they do not understand all the details on their payslips, according to a new study from the Institute of Payroll Professionals (IPP).

The group ran its pay survey from February to March 2010 and gathered nearly 400 responses from participants across the UK. Its chief executive, Lindsay Melvin, says that it is “surprising” that so many people do not understand their payslips.

Current legislation requires employers and payroll service providers to itemise payslips to employees so that individuals can check each month whether their payment is being correctly processed. However the figures highlight the fact that many people are still unaware of the importance of details such as National Insurance contributions, tax, employee benefits or pension deductions.

“Understanding all the details and figures in one’s payslip is the only way to be completely sure you are getting paid correctly,” says Mr Melvin. “In reality error rates are very low but knowing your payslip inside and out is the best way to be able to spot mistakes or miscalculations.” He added that this was “particularly relevant” with the increasing number of businesses using payroll software to deliver payslips entirely electronically, as many employees may be confused by the new format.

The IPP represents payroll outsourcing companies throughout the UK as well as offering professional accreditation and advice on best practice.