Newsflash: New year, new law

Happy New Year!  In order to get us all thinking ahead and welcome in 2017, below is a round-up of the most significant employment law changes this year.

We’re sure to be covering many of these events in more detail in our newsflashes and newsletters so keep an eye out…

Early 2017 – What’s happening?

Tax-free childcare scheme

Tax-free childcare scheme to be introduced so that families where both parents work and each parent earns less than £100,000 per year are eligible to receive 20% of their yearly childcare costs.

Tribunal fees challenge

The Supreme Court is scheduled to hear UNISON’s appeal against Tribunal fees on 27 and 28 March 2017 (this is re-scheduled from early December 2016: see our June 2016 Newsflash Tribunal fees – another decision coming…).

Consultation on grandparental leave

We updated you in our October 2015 Newsflash Shared grandparental leave that the Government proposes to allow working grandparents to be able to take shared parental leave. The Government plans to consult on these plans during the first half of 2017.

April 2017 – What’s happening?

Increase to Statutory Rates

There has been an increase in the consumer price index (CPI) of 1% in the year to September 2016, and therefore the Government (the DWP) has announced the following proposed increases to statutory benefit payments which will be effective in April 2017:

The weekly rate of:

  • Statutory Sick Pay (SSP) will rise from £88.45 to £89.35;
  • Statutory Maternity Pay (SMP) and (maternity allowance) will rise from £139.58 to £140.98; and
  • Statutory Paternity Pay (SPP), Statutory Shared Parental Pay (ShPP) and Statutory Adoption Pay (SAP) will rise from £139.58 to £140.98.

To be entitled to these statutory payments, the employee’s average earnings must be equal to or more than the lower earnings limit.  The lower earnings limit is increasing from £112 to £113 in April 2017.

Increase to National Minimum Wage

In the Autumn Statement 2016 the Chancellor of the Exchequer announced that the hourly rate of the National Living Wage, the rate for workers who are aged 25 and over, will rise from £7.20 to £7.50.

In addition, the National Minimum Wage rates are now also being increased in April (rather than October).  The new rates are as follows:

  • age 21 to 24 (inclusive): increase from £6.95 to £7.05 per hour;
  • age 18 to 20 (inclusive): increase from £5.55 to £5.60 per hour;
  • age 16 or 17 (inclusive): increase from £4 to £4.05 per hour;
  • apprentice rate:  increase from £3.40 to £3.50 per hour; and
  • accommodation offset: increase from £6 to £6.40.

Future changes to the hourly rate of the National Minimum Wage and the National Living Wage will take place at the same time in April each year.

6 April 2017

The apprenticeship levy

An apprenticeship levy to be paid by employers in all sectors with an annual wage bill in excess of £3m is due to be implemented on 6 April.  The levy will be 0.5% of their wage bill and will be used to fund apprenticeships. For further information see our October 2016 Newsflash Apprenticeship levy.

Gender pay gap reporting regulations expected to come into force

Employers with 250 or more employees in all sectors are required to calculate their gender pay gap and bonus pay gap calculated from pay information using the employer’s usual pay period in which 5 April falls.

Therefore although the first gender pay gap reports for large private and voluntary sector employers will not be due until 4 April 2018, employers will need to capture their first set of gender pay gap data in April 2017. For further information see our December 2016 Newsletter Government reforms (3): Gender pay gap – mend the gap!.

Maybe in 2017…

Public-sector exit payments repayable

The draft Repayment of Public Sector Exit Payments Regulations 2016 provide that employees in the public sector with annual earnings of £80,000 or more repay exit payments where they return to work in the public sector within one year of leaving. An implementation date is yet to be set.

Public-sector exit payments capped

The draft Public Sector Exit Payment Regulations 2016 provide that exit payments to public-sector workers are capped at £95,000.  An implementation date is yet to be set. For more information see our October 2015 Newsletter Government reforms (1): Cap on exit payments.