The term ‘golden handshakes’ has evolved in recent
years to describe some payments to departing employees. It does not
have a precise legal meaning and describes payments falling within
a variety of categories.
If an employer describes a payment as a ‘golden handshake’ in the context of :
In dealing with ‘golden handshakes’ it is important to consider what the payment is, why it is paid and how the amount paid is made up. If an employer tries to pay or hide contractual items such as accumulated overtime, backdated pay, fees, bonuses or holiday pay, etc. as payments in compensation for loss of office they will attract a liability for NICs.