Q Although we are not currently having to make staff redundant, we are imposing a pay freeze this year. Would it be appropriate instead to introduce a more generous complimentary tickets scheme as a gesture of goodwill to staff?
A An extra benefit for staff that costs nothing, more people seeing shows, and hopefully increasing good word of mouth – what’s not to like? Well, there are a few catches.
Is it legal? Check the small print before you “impose” a pay freeze. If your staff contracts promise an increase every year you will be in breach if you unilaterally decide that there will not be one, however good your reasons. Staff may, however, agree to a negotiated pay freeze whatever their contract says if they are sympathetic to your financial plight.
Is it practicable? If you make a formal agreement about a guaranteed comps allocation you may find yourself giving away tickets you could have sold.
Is it taxable? Yes, it can be. For staff earning over £8,500 a year (and that includes part timers whose pay would be at that level if they worked full time) these tickets will be a taxable benefit if the employer is out of pocket in any way in providing the benefit. So if you give away tickets you could have sold they will be a taxable benefit. Your staff members may not consider free tickets a good exchange for more tax and NI coming out of their frozen pay packets.
So, I would suggest that this offer should be an informal gesture not a deal. Make it clear that you are planning to be more generous than in the past but also make it clear that this is subject to availability of tickets. In terms of staff morale it is always going to be better to look at how you can adjust hours and workload to compensate for what will be, in real terms, salary cuts, rather than trying to looking at benefits in kind like comps.
Jackie Elliman is Legal & Industrial Relations Manager at the Independent Theatre Council.