employment law

Upcoming Employment Law Changes

As April approaches, there are several significant changes to employment law that your company should be aware of. Whilst not all of these may be directly relevant, it is nevertheless important that you remain aware of these changes:

Increase to the national minimum wage (NMW) and national living wage (NLW).

Beginning in April 2017, both the NMW and NLW will increase:

  • Apprentices: £3.50 per hour
  • Workers under 18: £4.05 per hour
  • Workers aged 18 to 20: £5.60 per hour
  • Workers aged 21 to 24: £7.05 per hour
  • Workers aged 25 and over (NLW): £7.50 per hour

See here for more details of these changes to employment law and how they can affect your business.

Closure notices to employers using foreign workers illegally. As part of a raft of changes being introduced to the UK’s immigration system, from 1 December 2016 Immigration officers (IOs) have the power to issue a closure notice to businesses suspected of employing illegal workers. The notices can prevent trading from a premises for up to 48 hours.

A forced closure, even for a short period of time, could have disastrous financial and reputational consequences for a business.

The Immigration Skills Charge. Employers sponsoring foreign workers with a tier 2 visa will be required to pay an immigration skills charge of £1,000 per worker (£364 for small employers and charities) beginning in April 2017. The immigration skills charge will be in addition to current fees for visa applications.

In April 2017, the minimum salary threshold for “experienced workers” applying for a tier 2 visa will also increase to £30,000. New entrants to the job market, and some health and education staff will be exempted from the salary threshold until 2019.

Mandatory annual gender pay gap reporting. Beginning in April 2017, private-sector, voluntary sector and public-sector organisations with 250 employees or more will be required to publish gender pay gap information for the first time.

Employers will be obliged to release information relating to employee pay and bonus pay, as well as information on the number of men and women in each quartile of the organisation’s pay distribution.

Apprenticeship levy. All companies with a pay bill of more than £3 million each year will be required to pay an apprenticeship levy. The levy will be set at 0.5 per cent of their total pay bill, minus a £15,000 levy allowance from the government.

Large employers will be able to access levied amounts, plus a government top-up of 10%, to fund apprenticeships from accredited training providers.

Smaller organisations that are not required to pay the levy will also be able to receive funding for accredited apprenticeships by contributing 10% towards the cost of an apprenticeship, with the Government paying the remaining cost.

While we are not specialists in employment law, our commercial teams are happy to help advise on risk management issues that these changes may bring about. Give your local branch a call today.