2017 Employment Law Update

Here’s an article by Angela McDonald, HR Director at People Puzzles, a very close partner of ours…

With so many changes afoot, is your company ready for the Gender Pay Gap reporting or taking advantage of the Apprentice Levy?

Gender Pay Gap Reporting
As of 5th April, employers with 250+ employees now have to calculate and publish their gender pay gap (the difference in pay between men and women). Even if employers don’t have to report it, they should be aware of this and ensure they are paying men and women equal pay for work of equal value.

Salary Sacrifice Changes
New rules come into effect on 6th April for certain benefits in kind which are provided by salary sacrifice.

Salary sacrifice for the following benefits will not be affected:
· Pensions or pension advice
· Childcare vouchers
· Workplace nurseries
· Directly employer contracted childcare
· Cycle to work
· Ultra-low emission company cars

Employers who are using salary sacrifice for other schemes should familiarise themselves with the new rules. Salary sacrifice contracts entered into on or before 5 April 2017 will be protected up until the contract hits a trigger point. The normal trigger point is when a contract renews, auto-renews, starts, ends or is modified or changed. If arrangements are still in place on 6th April 2018, then there will be an automatic trigger date of 6th April 2018 (6th April 2021 for certain benefits). Therefore, there is an opportunity for employers to review their current contract arrangements to take maximum advantage of the transition rules.

Employers should review all their salary sacrifice arrangements and understand where changes may need to be made, bearing in mind there may be further implications, such as amendments to employment contracts, handbooks etc. and communication with employees.

Apprentice Levy
The Apprentice Levy aims to fund three million apprenticeships in the UK by 2020. It will affect employers whose pay bill is over £3million a year and takes effect in April. These employers will have to pay 0.5% into the apprenticeship levy each month.

Employers will have their funds credited to their ‘levy account’ which will be topped up by 10% from the government. Employers can then use these funds to train apprentices in their business. If employers plan carefully, they will not only be able to recover their levy, but to draw down more than they paid in. Therefore, if employers do not already employ apprentices they should seriously consider where apprentices could be recruited into the business, or which roles could become apprentice roles.

Employment Status
Hot on the heels of the Uber and CitySprint cases, the case of Pimlico Plumbers and another v Smith is the latest case to challenge the employment status of the ‘self employed.’ In this case the Court of Appeal has ruled that a ‘self-employed’ plumber should have been classed as a worker.

The government has commissioned an independent review into modern working practices, including the gig economy. The issue of how law should regulate employment status in a growing gig economy is certain to remain a hot topic.

2016 Trade Union Act comes into affect
1st March 2017 saw the commencement of the majority of the provisions of the 2016 Trade Union Act. The Act introduces a 50% turnout requirement, i.e. at least 50% of those entitled to vote do so, with further requirements for important public sector services. Notice of industrial action has been extended to fourteen days and the Act also introduces a six-month time limit for the action to take place following a successful mandate (or nine months of the employer agrees).

Statutory wage rises
The National Minimum Wage and the National Living Wage rates increase in April.

The table below shows the rates for the National Living Wage and the National Minimum Wage. Workers must be school leaving age to get the National Minimum Wage and aged 25 to get the National Living Wage. The minimum wage will still apply for workers aged 24 and under.

 25 +      21 – 24      18 – 20      Under 18      Apprentice
£7.50      £7.05         £5.60        £4.05             £3.50

If your business needs any advice on any of these areas just drop us an email hello@peoplepuzzles.co.uk.

Freeman Clarke is the largest and most experienced team of fractional IT leaders. We work exclusively with ambitious organisations, helping our clients use IT to beat the competition and grow. Contact us and we’ll be in touch for an informal conversation.