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HMRC internal manual

National Insurance Manual

NIM07052 - Class 1 NICs: Payments made under employment legislation: Redundancy: Protective awards: NICs treatment

Sections 188-192 Trade Union and Labour Relations (Consolidation) Act 1992

Section 112(3)(c) Social Security Contributions & Benefits 1992

Regulation 2(b) Social Security (Contributions) (Employment Protection) Regulations1977

Under the above regulation, an amount payable by way of remuneration under a protectiveaward is:

  • treated as earnings payable by the person liable to make such payment to the person entitled to receive it; and
  • to be so payable for the period specified by the employment tribunal.

The gross amount of the protective award should be taken into account when assessingthe NICs liability.

For details about:

  • what a protective award is, see NIM07050
  • the earnings period to use in calculating the amount of Class 1 NICs, see NIM07060.