Page 45 - LITRG_PA-final-2018

Glossary

Agency An agency is a business that helps people find work. The work is normally
temporary. Sometimes agencies introduce people who are looking for work to
employers. If an agency sends you a personal assistant, they are the employer.

Benefits in These are benefits, other than pay. Examples include company car, health
kind insurance, and travel payments.

Department This is the government department which is responsible for most state
for Work and benefits in England, Wales and Scotland.
Pensions (DWP)

Employee An employee is someone who works for somebody else (called an employer).
An employer will often ask an employee to sign a contract of employment – a
document which records the terms they will work on (for example: working hours,
how much they will be paid, what happens if they are ill). There does not have to
be a written contract for your relationship to be legally counted as employment.

Employer An employer is a person or business who has to give work to someone and
pay them for it under a contract of employment. The employer directs and
controls the work that the employee does.

HM Revenue HM Revenue and Customs (HMRC) are the part of the government that deals
and Customs with tax, national insurance contributions, working tax credit, child tax credit
(HMRC) and child benefit.

Lower Earnings This is the minimum amount an employee must earn in order to qualify for
Limit (LEL) any social security benefits or statutory payments.

Local Authority Local Authorities (also known as councils or social services) are responsible
for the services in the area where you live.

National A person (and sometimes their employer) pays National Insurance contributions
Insurance to HM Revenue and Customs if they are aged 16 and over. The contributions
contributions build up their entitlement to state benefits.
(NIC) There are different classes. For example:

Class 1 NICs are made up of primary NICs (employee contributions) and
secondary NICs (employer contributions).

Class 1A NICs are paid by the employer on some benefits and expenses.
Class 2 are paid by people who are self-employed. It is a fixed weekly amount.
Class 4 are another type paid by people who are self-employed. The amount
depends on the taxable profit of your business.

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page 45 Taking on a personal assistant – a basic guide • Glossary