Changes to collecting trade union subscriptions (check-off)

The Trade Union (Deduction of Union Subscriptions from Wages in the Public Sector) Regulations 2017 (“the Regulations”) came into force on 10 March 2018. The Regulations concern ‘check-off’, which is the system by which an employer collects union subscriptions from employees by deducting them directly from their wages and paying them over to unions.

The Regulations state that a relevant public sector employer (including Academy Trusts and foundation / VA schools) can only make deductions from its workers’ wages in respect of trade union subscriptions if:

  • The trade union pays the employer a reasonable amount for this service; and
  • Workers have the option to pay their subscriptions by other means (e.g. by direct debit).

This is to ensure there is no cost burden to the taxpayer in the provision of check-off services in the public sector.

It is therefore possible to have a service level agreement (SLA) in place with the trade union. The SLA would capture the formal arrangements under which the employer (e.g. Academy Trust or foundation / VA school) can deduct trade union subscriptions on the union’s behalf. As stated above, employers can charge a reasonable fee for this arrangement. The law provides that the fee is reasonable if “the employer is satisfied that the total amount of the payments is substantially equivalent to the total cost to public funds of making the deductions”.

Therefore, it may help to find out the actual cost of providing the deductions (you may need to liaise with your payroll provider(s) to do this) and find out whether there are any phasing-in or one-off charges associated with moving to these arrangements. This may help you to decide on a ‘reasonable fee’ which should be reflected clearly in the SLA.

If a trade union does not seek an arrangement with an employer to make provision for reasonable payments for providing check-off, the trade union will need to consider making alternative arrangements for their affected members to pay their subscriptions.

The law and practice referred to in this article or webinar has been paraphrased or summarised. It might not be up-to-date with changes in the law and we do not guarantee the accuracy of any information provided at the time of reading. It should not be construed or relied upon as legal advice in relation to a specific set of circumstances.

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