From gender pay gap reporting and the introduction of GDPR regulations, 2018 was a busy year in employment law. Amidst the domination of the uncertain Brexit, we have produced a brief summary of some of the changes that you need to be aware of and some to plan for looking further ahead.
Increase in National Living Wage/ Minimum/Living Wage rates
They are set to increase as follows from the 1st April 2019
|25 and over||21 to 24||18 to 20||Under 18||Apprentice|
Statutory family and sick pay are also expected to increase.
Settled Status for EU nationals
European workers currently living in the UK will be able to apply for settled status in 2019, allowing them to remain indefinitely in the UK following the end of the Brexit transition period in 2021. To be granted settled status individuals must be able to prove they have been living in the UK for five years by the date of application. Those who do not meet this requirement can apply for temporary status, allowing them to remain until they have accrued enough residency to be granted settled status. Employers should play an active role in encouraging employees to consider their status early on and apply for the most appropriate documentation. This can be done by hosting information workshops with immigration experts or by signposting employees to useful sources of information.
The minimum contributions that organisations and their staff pay into automatic enrolment workplace pension schemes are set to increase from 6 April 2019; the minimum employer contribution will be 3% and the minimum employee contribution will be 5%. We would remind you to allow appropriate time to consult with staff before making any changes to their pension contribution scheme.
Changes to the way employers issue payslips will also come into force on 6th April 2019 as from this date onwards the legal right to a payslip will be extended beyond employees to include those who are recognised as ‘workers’, including casual workers and those on zero hours contracts. Employers will also be obliged to include the total number of hours worked on payslips for employees whose wages vary depending on how much time they have worked. It is important that you work with your payroll providers to ensure the correct procedure is in place ahead of April’s deadline.
Gender Pay Gap Reporting
Private organisations with 250 or more employees will again be required to publish their gender pay gap figures on the 4th April 2019. Although employers will be reporting for the second time, this year will be the true test as figures are expected to be heavily scrutinised in order to determine whether efforts to address any significant pay disparity highlighted in 2018 have been successful.
Whilst there are sure to be other new developments introduced throughout the year, employers should put plans in place to ensure their business complies with any new requirements.
Looking forward some of the changes in the pipeline line for 2020:
Good Work Plan/ Gig Economy
In December 2018, the Government committed to a wide ranging policy ensuring that workers and employers can access fair and decent work. Workers on “zero-hour contracts”, agency employees or “gig economy workers” are to be better protected by a package of workplace reforms. Some of the key changes include:
- Ensuring firms will have to provide a statement of rights setting out what paid leave they are entitled to, including for illness, maternity and paternity leave.
- Close a loophole that had allowed agency staff to be paid less than permanent employees.
- Ensure that companies will have to calculate holiday pay based on 52 weeks, as opposed to 12 week, so people in seasonal or a typical roles get the paid time off they are entitled to.
Employer National Insurance Contributions on termination payments
From April 2020, Class 1A employer National Insurance Contributions (‘NIC’) will be payable on termination payments over £30,000.
Termination payments will remain exempt from employees’ NIC, even if over £30,000.
Parental bereavement leave and pay
The new Parental Bereavement Leave and Pay Act will give all employed parents a right to 2 weeks’ leave if they lose a child under the age of 18 or suffer a stillbirth from 24 weeks of pregnancy. Employed parents will also be able to claim pay for this period, subject to meeting eligibility criteria.
Although the new right is not expected to come into force until April 2020, employers should start preparing for it during 2019 and could decide to introduce their own bereavement leave policy.
If you need further advice on any employment law issues please do not hesitate to contact Clover HR today.