Posts Tagged ‘Apprenticeships’

Employment Law Update – March 2017

Friday, March 31st, 2017

There are a number of new employment law developments and changes coming into force in April 2017.  Let’s take a look at some of them:

  • Gender Pay Gap reporting

New laws become effective from April 2017 affecting larger employers with 250 or more employees. These organisations will have to produce data about their gender pay gap, which also includes data about bonuses. There is also a duty to report on the proportion of male and female employees in different pay quartiles including bonus details. Pay data must be based on a snapshot of pay data on all employees every April commencing in April 2017. Organisations in the public sector must use 31 March as their relevant snapshot date every year. Gender Pay Gap details must be disclosed on the Employer’s website within a period of 12 months. There is also a further duty to upload this data to a Government website.

  • Increases to the National Minimum and Living Wage

The National Living Wage affecting employees aged 25 and over increases from £7.20 an hour to £7.50 effective from 1 April 2017.

There are also additional new rates to the National Minimum Wage affecting other age brackets as follows: –

  1. £3.50 for apprentices under 19 or 19 or over who are in the first year of an apprenticeship.
  2. £4.05 per hour – 16-17 yrs old
  3. £5.60 per hour – 18-20 yrs old
  4. £7.05 per hour – 21-24 yrs old

 

  • Changes to salary-sacrifice schemes

On 6 April 2017, various benefits in kind which currently attract income tax and national insurance advantages when provided under a salary-sacrifice scheme are to be limited. The Chancellor of the Exchequer announced these changes last year as part of his Autumn Statement. The changes are likely to affect benefits such as gym membership, mobile phone contracts and health checks that are offered as part of a salary-sacrifice scheme. No changes however will be made to child care, pensions savings and cycle to work schemes which will continue to be exempt. Arrangements made before 2017 will be protected until April 2018. Arrangements for cars, accommodation and school fees will be protected until April 2021. The rationale behind these changes is that the Government believes that the growth in these schemes is impacting on lost income tax and national insurance contributions.

  • New Apprenticeship Levy introduced

The Government’s apprenticeship levy to fund and promote apprenticeship training as an alternative to full time further education is coming into force on 6 April 2017. All employers who have a payroll bill in excess of £3 million will have to pay a monthly levy. Small employers that do not have to pay the new levy will be able to access funding for apprenticeships and this new system of funding is expected to start from May 2017.

  • New Immigration Laws

From 6 April 2017 employers that sponsor skilled workers under Tier 2 of the immigration points based system will now have to pay a levy of £1,000 for each sponsorship. Small employers and charities will only have to pay £364. In addition, workers arriving in the UK under Tier 2 for positions in education, social care and healthcare must now obtain criminal record certificates from the countries that they have resided in for the past ten years. The Tier 2 salary threshold is also increasing to £30,000.

From 6 April 2017, a weeks’ pay for the purposes of calculating statutory redundancy pay increases from £479 to £489. The maximum basic award increases from £14,370 to £14,760 and the maximum compensatory award increases from £78,962 to £80,541.

  • Increases to statutory maternity, paternity, adoption, shared parental leave and statutory sick pay

From 2 April 2017, statutory maternity, paternity, adoption and shared parental leave weekly rates increase from £139.58 to £140.98. From 6 April 2017, statutory sick pay weekly rates increase from £88.45 to £89.35.

New developments affecting worker status

There have recently been further case law developments on the status of workers in the so called ‘Gig economy’. In Boxer -v- Excel Group Services Ltd (in liquidation) an employment tribunal has ruled that a cycle courier who was labelled as a contractor was in fact a worker. This entitled him to various employment rights including the right to holiday pay, statutory sick pay and the national living/minimum wage. The employment tribunal held that the arrangements in place and the contract signed by the parties did not reflect the reality of the situation. The main influencing factor for the employment tribunal was that Excel controlled Mr Boxer and the lack of bargaining power that he had when signing his contract that labelled him as a contractor. It is likely that we will see more developments where these arrangements are being challenged. The Government is also likely to legislate at some point in the near future to promote employment rights for individuals working in this new economy.

Please call Steven Eckett, our employment solicitor, on 020 7998 7777 for more information or email him at steven.eckett@bloomsbury-law.com.

EMPLOYMENT SERVICES

Employment Law Update – January 2017

Wednesday, February 1st, 2017

2017 looks like a busy year for UK employment law both in terms of legislative changes and case law developments.  Here is a snap-shot of some of the major changes that can be expected: –

Gender Pay Gap Reporting

The Regulations are due to come into force on 6 April 2017 and affect private sector organisations with 250 or more employees.

ACAS and the Government Equalities Office have also published guidance on how businesses can calculate and report their gender pay gap in their organisation.

A revised version of the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 was published in December 2016. All organisations must publish a snapshot of salaries and bonuses across 6 key metrics and publish information on their website about their gender pay gap within 12 months of the Regulations coming into force and then annually thereafter.

Public sector Regulations are also being introduced as part of the existing public-sector equality duty.

Holiday Pay

The case of British Gas -v- Lock is being appealed to the Supreme Court and British Gas are hoping to overturn the Court of Appeal’s decision which held that holiday pay should include commission payments.   This authority is also in line with recent developments which held that regular overtime payments also needs to be included in the calculation of holiday pay.

It is also clear that European Union case law supports these developments and for now the UK remains a member of the European Union, notwithstanding BREXIT.  Consequently, the UK remains bound by any European rulings until we have formally left the European Union currently suggested for 2019.

Salary Sacrifice Schemes

This follows on from last year’s Autumn Statement where it was announced that there would be changes to the tax status of some salary sacrifice benefits with effect from April 2017.  This will mean that some benefits will no longer benefit from tax exemptions under the banner of salary sacrifice for example cars, accommodation and school fees and other benefits in kind.   However, pensions, childcare vouchers and cycle to work schemes will continue to be exempt from tax under the new salary sacrifice rules.

Apprenticeships

New rules come into effect on 6 April 2017 whereby the Government is introducing its anticipated annual apprenticeship levy.   The new rules will apply to all employers in the UK with a salary outlay of £3 million or more.   The levy will be charged at the rate of 0.5% of the total salary bill.   An annual allowance of £15,000 can also be offset against the levy.   The aim of the legislation is to promote apprenticeships for young people and to increase their number for those employers that have salary levels below £3 million.   It is being promoted as an alternative to full time further education and to promote training and skills for young people.

Worker Status in the Gig economy

Following on from last year’s landmark Uber judgment ruling that taxi drivers were workers entitling them to various employment rights there has been another successful challenge his time in the courier sector.   An employment tribunal at first instance held that a CitySprint courier was also a worker and not self-employed.   Further challenges are expected this year, and also the appeal from Uber, along with Government proposals to introduce new employment laws to cater for the growing Gig economy and 21st century ways of working.

Case law developments:

Creighton -v- Together Housing Association Limited

This employment tribunal decision related to a long serving employee who was dismissed by his employer because he made derogatory comments about his colleagues and his employer on Twitter for up to three years.

The employment tribunal held that the dismissal for gross misconduct following a disciplinary investigation and hearing was a potentially fair reason relating to his conduct.

This authority demonstrates once again that it is vitally important that employers not only have an effective social media policy in place that is regularly brought to the attention of employees but that employers are consistent in applying it to all employees.

Call Steven Eckett, our employment solicitor on 020 7998 7777 for more information or email him at steven.eckett@bloomsbury-law.com.