Payroll Giving - a painless and positive way to donate to charity

Third Sector recently reported that payroll giving has reached a four year high with 15,000 more employees giving in 2011/2012 than the year before. The total number of employees now giving in the UK stands at 735,000: the highest since the recession began. But more needs to be done to realise the full potential of payroll giving, something of which Nick Hurd, the Minister for Civil Society, seems to be aware. At the Institute of Fundraising’s convention earlier this year, Hurd told delegates that the government was “determined to get serious about payroll giving” and encourage greater use of it.

Nick Hurd’s opinion would seem to be supported by the UK Giving report released by CAF and NCVO in 2011, which showed that only 1% of total donations in the UK were given via payroll, as opposed to 59% through Gift Aided routes  such as direct debits, cheque, card and cash.

So what can employers do to encourage their employees to take up the scheme? Payroll giving doesn’t have to cost employers anything, it’s free to set up and is designed to be quick and painless.  Some companies choose to incentivise employees to get involved, and while we do encourage this kind of support and it does tend to lead to higher levels of participation it is not a necessity.

The greatest challenge that payroll giving faces is clearing up the many misunderstandings around how it works and why it’s one of the most reliable form of charitable giving, employees (and employers not involved in the scheme) simply don’t understand the benefits. Making them aware is easy, employers can do so through induction packs, on intranet sites, in staff areas, through face to face awareness raising, through staff champions or through a number of other creative means.

The more we can make employers and employees aware of the scheme the easier it will be to increase tax efficient giving to the third sector. 

CAF operates the number one payroll giving scheme CAF Give As You Earn.

Dan Knight, Company Relations Manager, CAF