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Document updated/added on 14.05.2021

Topic: Contractual clauses

Attendance allowance clause
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Attendance allowance clause

Attendance allowance clause

Use our clause to set out an employee’s entitlement to an attendance allowance in their employment contract.

Discretionary allowance

Only include our Attendance Allowance Clause in an employee’s employment contract if you actually intend to pay an attendance allowance to them. If you do want to insert our clause, it’s widely drafted and makes the payment of the allowance entirely discretionary. However, be aware these types of allowance which you may regard as discretionary can still harden into contractual entitlements over time as a result of ongoing custom and practice.

Discrimination

Disabled employees may be absent from work more often than non-disabled employees due to their disability, making it difficult for them to achieve the standards required for an attendance allowance. As such, you may need to adjust the qualifying levels of attendance for a disabled employee, taking into account their particular disability, in order to ensure you’re not discriminating under the Equality Act 2010. If an employee is absent from work due to a pregnancy-related illness, they shouldn’t be penalised for that, e.g. by being denied an attendance allowance. So, you should disregard any pregnancy-related absences. In addition, where the employee’s maternity leave starts during an assessment period, you’ll need to award them the proportion of the allowance that equates to the period of time that they were working before their maternity leave started, but also including the two-week compulsory maternity leave period as worked time. You can then exclude the other maternity leave weeks from the allowance assessment period.

Level and frequency of allowance

With an attendance allowance, you’re effectively rewarding staff for coming to work, when this is already a basic requirement of their employment contract for which they receive their salary. So, do consider how much you realistically want to pay here and whether this should reward good attendance over a significant period of time, such as a quarter or a year, rather than over short periods such as a week or a month. Our clause gives you all these options.

Days or occasions of absence?

We’ve also given you the option to calculate the allowance according to the number of days of absence or the number of occasions of absence. The latter would ensure that those who are good attenders but then suffer from a one-off serious illness aren’t penalised. Unfortunately, setting a target level at which the allowance is paid may be interpreted by some as meaning any absence up to that level is acceptable, resulting in more sickies. Conversely, some sick employees may try to return to work before they’re well enough, in order not to lose the allowance.

Nothing on leaving

If you want to ensure that an employee doesn’t get an attendance allowance if they’re working their notice period - or even have left employment - when it’s paid for an assessment period, make this clear in the clause, as our does.

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