Employment law is constantly changing and so it’s vital that you are aware of the most up-to-date and current legislation.
From April 6th 2020 any part of a termination payment over £30,000 will be subject to employer National Insurance Contributions (NIC’s) – the implementation of this law was delayed from April 2018.
Looking forward to 6th April 2020 we expect to see the implementation of the Governments ‘Good Work Plan’ with three areas receiving amendments to current Regulations:
- Agency Workers (Amendment) Regulations 2019 – to prevent agencies opting out of equalizing the pay of agency staff with the permanent work force after they have worked for the same employer for 12+ weeks.
- Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018 – which includes improving the holiday entitlement for seasonal workers by extending the reference period of an average week’s pay from 12 weeks to 52 weeks.
- Employment Rights (Miscellaneous Amendments) Regulations 2019, part 3, which extends the right for a statement of ‘written particulars’ (basic employment terms and conditions) to be provided from day one to workers as well as employees.
The Government recently carried out a consultation on pregnancy and maternity discrimination; this has resulted in the Government proposing a change to current legislation afforded to an employee at risk of redundancy while on Maternity, Adoption, or Shared Parental Leave with the following extension of rights for:
- pregnant employees, once they have told their employer of their pregnancy;
- employees returning from Maternity or Adoption Leave within the previous six months; and
- parents returning from Shared Parental Leave (although how the limits on this right will operate is still to be worked out).
If it currently not clear if / or when this will be implemented.
The health and wellbeing of all employees is vitally important in business; unfortunately, at times an individual’s health is not compatible with the role they were employed for. The Department for Work and Pensions are currently undertaking a consultation into what action the Government and employers can take to reduce ill health-related job loss. The consultation closes on 7th October 2019. Have your say: https://www.gov.uk/government/consultations/health-is-everyones-business-proposals-to-reduce-ill-health-related-job-loss
Have your say about proposed changes to Company National Insurance contributions (NICs); the consultation closes on 20th August 2019. If approved the legislation will take effect from 6th April 2020 https://www.gov.uk/government/consultations/draft-legislation-employment-allowance-eligibility-reforms
Following the shakeup of data protection within Europe during 2018, ‘The GDPR’ now incorporated in the UK within the Data Protection Act 2018, it is widely believed by expects in the field that The Information Commissioner’s Office are likely to begin cracking down on breaches and issuing enforcement notices. Now is the time to ensure that your processes are compliant and make urgent changes if they fall short.
Employers – did you remember to amend your payroll figures in April to ensure that you are paying a minimum of 3% of your qualifying employees pre-tax salary into their pension, and that they are paying the increased figure of 5%?
Parent bereavement leave; whilst it is not due to come into force until April 2020 now is the time to start preparing your business. If you do not have your own bereavement leave policy it is advisable to implement this before next April.
The current proposal will allow bereaved parents, in the 56 weeks following the death of their child, paid leave as either a single two-week period, or as two separate periods of one week each.
April is just around the corner and with this we see increases to the Nation Minimum Wage, Pension contributions (both employer and employee) and increased statutory family and sick pay rates. Additionally, as we advised in November, don’t forget that from 6th April 2019 workers, as well as employees, have a right to receive an itemised pay statement.
With the Brexit date drawing ever closer, we are due to see the end of free movement within the EU (we think!). Whilst this will not happen straight away, businesses should be aware that employing EU nationals, in the longer term, is likely to be subject to restrictions (as with other non-EEA nationals). Now may be the time to consider reviewing and making any required adjustments to your recruitment processes and recruitment and retention policy.
1st January 2019 sees executive pay gap reporting come into force. This Regulation requires UK listed companies with 250+ UK employees to report the pay gap between their average worker and their chief executive and will apply to financial years starting on or after 1st January 2019 with the first reporting starting in 2020.
In April 2019 employer NICs on any termination payment over £30,000 is due to become law; this was originally due to come into force in April 2018.
Advance notification of Pay Slip changes that come into force on 6th April 2019. From this date a payslip must be given to ‘workers’ as well as employees. Additionally where pay varies due to the hours worked i.e. for those on zero hour or variable hour contracts, the total number of hours work needs to be included in the information provided.
Be prepared; from 1st January 2019 companies in the UK with 250 + employees will need to report annually on the pay gap between their chief executive and their average UK worker.
The private members Workers (Definition and Rights) Bill is expected to pass to the second stage of Parliamentary procedure in October 2018. The Bill looks to clarify the definition of ‘worker’, following recent case law from the Supreme Court, and place a ban on Zero Hours Contracts unless there is agreement from the individual’s trade union (where the company recognises the union).
It was recommended by The House of Commons Business, Energy and Industrial Strategy select committee that from 2020 companies with 50+ employees should also be subject to gender pay gap reporting.
An enquiry is being held by the House of Commons Women and Equalities Committee to ascertain how well the Equality Act 2010 is working. The deadline for submissions is 5th October 2018 .
Advance warning of changes to the Childcare Voucher salary-sacrifice schemes: from October 2018 no new entrants will be accepted, although the scheme will continue for those registered before this date. For individuals applying for the new tax-free childcare scheme the following link will assist with any questions: https://www.childcarechoices.gov.uk/
General Data Protection Regulation (GDPR) comes into force on Friday 25th May 2018; this has dominated many conversations for some months. However, should you have any outstanding questions or concerns, the Information Commissioner’s Office have a dedicated free phone line for small businesses, telephone: 0303 123 1113 and select option 4 or generic information is available on www.ico.org.uk. This line will continue to be available for a period of time after the 25th May 2018.
This month we see an increase to the auto-enrolment pension contributions for both employers and employees. Ensure you make the necessary amendments to payroll and notify your employees.
|Date||Employer contribution||Employee contribution||Total contribution|
|Until 5 April 2018||1%||1%||2%|
|6 April 2018 to 5 April 2019||2%||3%||5%|
|6 April 2019 onwards||3%||5%||8%|
The National Minimum Wage (Amendment) Regulations 2018 has been presented to Parliament with the following increases to the hourly rate which will take effect from 1st April 2018:
- Aged 25+ currently £7.50 increase to £7.83
- Aged 21-24 currently £7.05 increase to £7.38
- Aged 18-20 currently £5.60 increase to £5.90
- Aged under 18 currently £4.05 increase to £4.20
- Apprentice rate currently £3.50 increase to £3.70
We will also see an increase in the accommodation offset; which will rise to £6.40 to £7.00 per day.
From 6th April 2018 we will see the following:
- Increase to the maximum award for redundancy payments and the unfair dismissal basic award. Currently £489 increasing to £508
- Increase to the maximum compensatory award for unfair dismissal. Currently £80,541 increasing to £83,682
- From 31st March 2018 the UK Government will no-longer provide the free ‘Fit for work’ assessment centres in England and Wales (this takes effect from 31st May 2018 in Scotland). As an employer, employee or GP you are still able to access the ‘Fit for work’ helpline, website and web chat service.
- If you would like to have your say on enforcing the gender pay gap regulations the consultation is still open; you have until 2nd February 2018.
- Agreement was reached on Friday 8th December between the UK Government and the European Commission with regards to the rights of EU citizens post Brexit. EU citizens currently living in another EU country will maintain the rights to live, work and study there. Furthermore the European Court of Justice will maintain a role in overseeing their rights until March 2027; eight years after Brexit.
- We urge companies that run their annual leave year from 1st April – 31st March, offering the statutory minimum annual leave of 20 days plus bank holidays, to check the wording in their Contracts of Employment. The Working Time Regulations entitle employees and workers to a minimum of 5.6 weeks’ annual leave (28 days annual leave for a 5-day working week). However, due to the way Easter falls in 2018, straddling March and April, some employees may experience an unanticipated shortfall in their annual leave entitlement. If this is the case, a minor change to the wording can prevent any complications.
- On Friday 30th September 2017 the Criminal Finances Act 2017 came into force. This new law has the facility to hold UK companies criminally accountable (unless they are able to prove that reasonable preventative steps have been taken) if they have not prevented tax avoidance anywhere in the world which has been committed by an ‘associated person’ i.e. an employee, a worker or contractor. Further information regarding the Act can be found via: 2017 No.876 Criminal Law
- Reminder to all businesses with an annual turnover of at least £36million; if your financial year runs from April to March then preparations should be well underway for the publication of your second annual modern slavery statement. Whilst the UK Government has not stipulated a date they do state “ as soon as reasonably practical after the end of each financial year’” and offer a six month time frame in their guidance notes. https://www.gov.uk/government/publications/transparency-in-supply-chains-a-practical-guide
- Reminder to working parents with children aged 3-4 years; from 1st September 2017, the Government is increasing the free childcare scheme to 30 hours per week. The extended free hours apply to families were both parents work, or for single parent families where the parent works. For either group, all parties must earn the equivalent of 16 hours at the National Minimum Wage / National Living Wage rate or earn less than £100k per annum. For further information, go to https://www.gov.uk/help-with-childcare-costs/free-childcare-and-education-for-2-to-4-year-olds
- The Government Equalities Office have extended the closing date on the consultation period regarding caste in Great Britain and equality law. Your view can be submitted by following the below link before 18th September 2017. https://www.gov.uk/government/consultations/caste-in-great-britain-and-equality-law-a-public-consulation
- The Low Pay Commission (LPC) are currently consulting with employers about the effects of the minimum wage rates. They are requesting that evidence is presented to them by 7th July 2017; further information can be obtained from: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/610184/Low_Pay_Commission_consultation_letter_2017.pdf
- The responses will be collated and their findings and recommendations presented to the Government for their acceptance or rejection.
- General Data Protection Regulation (GDPR) needs to be a high priority for employers throughout the coming year. Audit checks on how personal data is collected and processed need to meet with the GDPR conditions for employee consent. This is likely to see Employers having to create/amend policies and processes to ensure they are fully compliant with the new governance and record-keeping requirements due to come into force in May 2018.
- 6th April, if an employer’s payroll per annum exceeds £3 million they are required to pay a 0.5% Apprenticeship levy on their total payroll bill. For further information, please look at our April blog
- Additionally on the 6th April changes to the salary-sacrifice scheme come into effect. Schemes that started before April 2017 will be protected until April 2018, except those relating to cars, accommodation and school fees which are protected until April 2021. The following schemes are currently not affected by the changes: pension savings (including pension advice), childcare, ultra-low emission cars and cycle-to-work.
- Be prepared – on the 1st April we will see an increase to both the National Minimum Wage and National Living Wage. The following quick ‘at a glance’ table will ensure that you are paying your people accurately.
Minimum Hourly Rate
|Worker ages 25+||
£7.50 per hour
|Worker aged 21-24||
£7.05 per hour
|Worker aged 18-20||
£5.60 per hour
Worker aged 16-17
£4.05 per hour
Apprentice aged under 19, or aged over 19 and in their first year of apprenticeship
£3.50 per hour
- Additionally, from 6th April 2017 organisations with 250+ staff need to start reporting their gender pay gap. For more information regarding this please use this link to the ACAS Gender pay reporting guidance document. http://www.acas.org.uk/index.aspx?articleid=5768&utm_medium=email&utm_campaign=NTL%20March%202017&utm_content=NTL%20March%202017+Version+A+CID_d68f40e8e848bc973f06384bd6ce4423&utm_source=Acas%20National%20Email%20Marketing%20Live&utm_term=Gender%20pay%20reporting%20guidance
- Subject to parliamentary approval, the Mandatory Gender Pay Gap Reporting – Public Sector, will come into force on 6th April 2017: https://www.gov.uk/government/consultations/closing-the-public-sector-pay-gap.
- The consultation period for the corporate governance reform is drawing closer; any comments should be received by 17th February 2017. A copy of the Green Paper issued on 29th November 2016 can be found by clicking this link: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/584013/corporate-governance-reform-green-paper.pdf
- 1st December 2016 saw the implementation of Section 38 of the Immigration Act 2016. This provision allows chief immigration officers to issue an employer with a closure notice for a maximum of 48 hours where they reasonably suspect that illegal foreign workers are being employed and the employer has already committed certain specific offences of illegal working. An application can then be made to the relevant court for an illegal working compliance order which can prohibit or restrict access to the employers premises for a period of 12 months, which can be extended a further 12 months in certain circumstances.
- On 21st November 2016 ss77. to 84 of the Immigration Act 2016 came into force. This legislation will ensure that staff with customer-facing roles in the public sector speak fluent English, and/or Welsh for public authorities in Wales; including (but not limited to): central Government departments; non-departmental public bodies; councils and other local government bodies; NHS bodies; state-funded schools;the police and the armed forces; and public corporations.
- At this time, providers of public services employed in the voluntary-sector and private-sector do not have to apply the language requirements.
- The 24th November saw the start of a phased salary increase for tier 2 sponsored migrant workers on the points-based immigration system. From this date the increase will be to £25,000 with a second rise in April 2017 to £30,000. This change does not currently affect nurses, radiographers, paramedics or secondary school teachers of mathematics, chemistry, physics, computer science and Mandarin who are exempt until July 2019.
- The minimum threshold for new entrants remains unchanged at £20,800.
- 1st October 2016 saw a change in minimum hourly rates for workers 24 years and under; including Apprentices aged under 19. The following quick glance table will ensure that you are paying accurately.
- The National Minimum Wage rate for those aged 25 and over remains the same at £7.20 p.h.
Minimum Hourly Rate
|Worker aged 21-24||
£6.95 per hour
|Worker aged 18-20||
£5.55 per hour
|Worker aged 16-17||
£4.00 per hour
|Apprentice aged under 19, or aged over 19 and in their first year of apprenticeship||
£3.40 per hour
- 7th September 2016 the new whistleblowing rules come into force within the financial sector. This applies to banks and building societies and some insurance and investment companies.
- The tax rulings for payments in lieu of notice (PILON) are set to change in April 2018. The consultation details and draft legislation were recently published in this regard. Whilst the £30,000.00 exemption from tax payment in cases such as redundancy will remain in place, payments above this threshold will be subject to both income tax and employers NIC’s. The closing date for comments on this consultation document is 5th October 2016. https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/545135/Simplification_of_the_tax_and_National_Insurance_treatment_of_termination_payments-government_response_and_consultation_on_draft_legislation.pdf
- The Immigration Act 2016 came into force on 12th July and introduces a range of measures to crack down on businesses that employ migrants illegally. The Act makes a number of changes to the criminal offence of employing illegal workers. The Act introduces tougher sanctions on employers, increasing the maximum custodial sentence on indictment from 2, to 5 years. It also introduces a completely new power to close premises for up to 48 hours where a business employs illegal migrants. The Act will also make it easier to prosecute employers who deliberately turn a blind eye to employing illegal workers. The existing criminal offence of ‘knowingly employing an illegal migrant’ will be extended to apply when an employer knows or has ‘reasonable cause to believe’ that a person is an illegal worker. The Immigration Act also makes illegal working a criminal offence in its own right, with a maximum custodial sentence of 6 months and/or a fine. Wages paid to the illegal worker can be seized as the proceeds of crime. A Government factsheet is available at: https://www.gov.uk/government/collections/immigration-bill-2015-16
- The Psychoactive Substance Act 2016 came into force on 26th May. This new legislation targets substances that are commonly referred to as ‘legal highs’ and generally have 3 main effects – as stimulants, sedatives or hallucinogens. Whilst screening for their use is difficult, it is recommend that employers look at the mind-altering affects they cause rather than the drugs themselves, such as an employee’s behaviour or ability to work. Check that your policies include ‘substances’ and update accordingly to ensure your Disciplinary procedures cover this relatively new phenomenal.
- Employers with 250 or more employees in the private and voluntary sectors must publish an annual report with details of their gender pay and bonus gap, with the first report to be published by 30th April 2018. It is not unreasonable to assume that suppliers to such companies, regardless of their size, may be asked to provide similar reports.
- The gender pay gap information must include the mean difference in bonus payments between men and women. The information on bonus payments must be based only on data for those employees who receive bonus pay during the 12 months to 30th April in each year. The first gender bonus pay report must be calculated using pay information for the 12 months from 1st May 2016.
- From 1st April, the new ‘National Living Wage’ of £7.20 per hour was introduced for workers aged 25 and over. It becomes the new compulsory top rate for the National Minimum Wage (NMW).
- The NMW rates for other workers remain unchanged until 1st October 2016, when it has been announced the rates will be:
|Category of worker||
Current NMW hourly rate
NMW Rate from 1st October 2016
|Worker aged 25+||
|Worker aged 21-24||
|Development rate for worker aged 18-20||
|Rate for worker aged 16-17||
|Apprentice in 1st year of their apprenticeship||
- The Government announced that in future the National Living Wage and National Minimum Wage rates will be increased together, starting April 2017.
- From 1st April 2016, the penalty for employers found not to have paid the National Minimum Wage doubled, to 200% of the total underpayment (for pay reference periods that began before 1st April 2016, the penalty is 100%). There is a minimum payment of £100 and a maximum payment of £20,000; note that the maximum payment applies for each worker who has been underpaid.
- Statutory Maternity, Paternity, Shared Parental and Adoption Pay remained frozen at £139.58 per week.
- Statutory Sick Pay also remained frozen, at £88.45 per week.
- From 6th April, employers no longer needed to pay employer national insurance contributions for apprentices aged under 25.
- From 6th April, employer-sponsored skilled foreign workers coming to the UK under tier 2 of the immigration points system are required to earn a minimum salary of £35,000.
- From 6th April, Tribunal Enforcement Officers can impose a financial penalty on employers that fail to pay a Tribunal award or ACAS settlement sum. The penalty will be 50% of the unpaid award, subject to minimum and maximum amounts and a reduction for prompt payment.
- From 31st March, larger companies with a total turnover of at least £36 million per year and whose financial year ended on or after 31st March 2016, have to comply with the duty to publish a ‘slavery and human trafficking’ statement for that financial year. It seems inevitable that the obligation to publish anti-slavery and trafficking statements will filter down to smaller companies who provide goods or services to these larger companies.
- The ‘Exclusivity Terms in Zero Hours Contracts (Redress) Regulations 2015’ went live on 11th January 2016. These provide protection for workers on Zero Hours Contracts, giving them protection from detriment and dismissal (irrespective of their age or length of service) for breaching an exclusivity clause in their Contract of Employment (by doing work or performing services under another Contract or other arrangement). From this date, they therefore became able to bring a complaint to an Employment Tribunal for compensation if they are subjected to a detriment or are dismissed.
- National Minimum Wage increases from £6.50 to £6.70 for workers aged 21 and over; from £5.13 to £5.30 for workers aged 18 to 20; from £3.79 to £3.87 for workers aged 16 to 17; and from £2.73 to £3.30 for Apprentices.
- Enterprise Bill protects the term ‘apprentice’ by (amongst other things) making it a criminal offence to offer an apprenticeship course or training if it is not a statutory apprenticeship.
- Online driving licence checking code is now valid for 21 days instead of 72 hours.
- The Government announced that a new compulsory Living Wage of £7.20 per hour will be introduced next April for all working people aged 25 and over.
- New regulation came into effect to prevent claims of arrears of holiday pay going back more than 2 years.
- Fit for Work haven’t to inform when the service will be rolled out in Bedfordshire.
- All young people in England will be required to continue in education or training until the age of 18.
- Exclusivity clauses in Zero Hours Contracts were banned from 26th May.
- Employers who underpay the National Minimum Wage will face a maximum penalty of £20,000, on a per worker basis rather than per notice.
- Statutory Maternity, Paternity, Shared Parental and Adoption Pay all increased from £138.18 to £139.58 on 6th April.
- Statutory sick pay increased from £87.55 to £88.45 on 6th April.
- Employment Tribunal awards limits rose as the maximum compensatory award increased from £76,574 to £78,335 and, the limit on a ‘week’s pay‘ increased from £464 to £475 from 6th April.
- The right to Unpaid Ordinary Parental Leave was extended to parents of any child under the age of 18 from 5th April.
- New drug-driving law introduced in England and Wales aims to catch those who drive under the influence of drugs.
- Employment agencies and businesses in GB are banned from advertising jobs exclusively in other European Economic Area countries without advertising them at home.
- Government announced that it will implement improvements (in stages, from 6th April) to the CIS for taxation.
- ECJ ruled obesity as a disability under certain circumstances.
If you’re not 100% sure you know the full facts about employment legislation and the changes we are facing, contact us now. Whatever your business, whatever your concerns, we offer no-nonsense advice and practical support to ensure you comply fully with all relevant legislation. No fuss. No worry. No costly mistakes.