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Employment Law Update 2016

With the new financial year, the raft of new employment legislation set out by the government over the last 12 months finally comes into effect. Whilst this year’s updates cover a broad range of matters that won’t be relevant to all of us, you do have a legal obligation to make sure that you are up to date with all the latest changes and ensure they are reflected in your contracts, handbooks and general working practices. Some of the key employment law reforms heading our way are outlined below.

Anti-slavery statements introduced - October 2015

Companies with a total turnover of at least £36 million per year may have to implement anti-slavery statement during 2016, depending on their tax year. 

Governments fit for work scheme

Now rolled our across the country.

Statutory Pay

Unlike most other years, April 2016 will see statutory maternity, paternity, shared parental, adoption and sick pay frozen at 2015/16 levels.

NI for Apprentices

From April, employers will no longer have to pay Employer National Insurance Contributions for apprentices under the age of 25.

National Living Wage

Also coming into force in April is the new National Living Wage. This is in effect a premium on top of the existing National Minimum Wage for workers aged 25 and over. The new pay level will initially be set at £7.20 per hour, rising to around £9 per hour by 2020. Hefty fines will be levied for those not adhering to the new minimum pay limits.

National minimum wage penalty increased for those who are found not paying - April 2016. 

National Mininum Wage Increases - October 2016

The national minimum wage hourly rate will increase as follows: 

Aged at least 21 but under 25: £6.95 (previously £6.70)

Aged at least 18 but under 21: £5.55 (previously £5.30)

Aged 16 or 17: £4.00 (previously £3.87)

Apprentice rate: £3.40 (previously £3.30)

The national living wage, (workers aged 25 and over) will remain at £7.20 per hour. 

Gender Pay Gap Reporting - duties commence 30 April 2016

Employers with 250+ employees must publish an annual report.  Details must include the differences in mean and median pay and mean bonus pay between male and female employees, expressed as a percentage. Organisations must publish their first report within 12 months of 30 April 2017. The Government will issue guidance on the Regulations. Advice to businesses is to prepare now, well in advance of the need to publish figures. 

Trade Union Bill

The Trade Union Bill reforms the rules on trade union ballots for taking industrial action - implementation date to be confirmed. 

Park City will keep you up to date and compliant with all the current legislation and keep you well abreast of future developments within UK employment law.

Tax free element of termination payments - changes expected 2018

Aim was to simplify termination payments but organisations may actually find it more complex in practice. 

Other Updates: 

  • Ban on exclusivity clauses in zero hour contracts enforced - January 2016. 
  • New rules on regulatory references for financial sector - March 2016
  • Limit on number of employment tribunal postponements came into force - April 2016
  • Employers NIC's abolished for apprentices under 25 - April 2016

Tax free element of termination payments - changes expected 2018


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