Employment Law Changes for April 2016

Employment Law Changes for April 2016Here’s a quick outline of employment law changes for April 2016

31st March 2016 | Slavery and Human Trafficking Statements

Companies that have a total turnover of £36 million pounds or more per year must publish a statement identifying what steps they have taken to ensure there is no slavery or human trafficking in the process of delivering their goods and services and additionally they must state if ‘no steps’ have been taken of that is the case.

This requirement is for employers that have a financial year which ends on or after 31st March 2016.

1st April 2016 | National Living Wage

There’s been a significant amount of coverage in respect of the new National Living Wage which came into effect on 1st April 2016, the real test will come when employer’s process their first payroll after this date and incorporate the pay reference period.

Let’s have a quick re-cap about the requirements that employer’s must implement for their workforce

  • The National Living Wage (NLW) is applicable to workers once they reach the age of 25 and apprentices who have completed their first year of an apprenticeship program.
  • Workers that reach the age of 25 are entitled to receive the NLW when the next pay reference period commences
  • The rate is £7.20 per hour and is intended to be increased every April
  • The pay reference period is the period of which is to be paid, the maximum it can be is one calendar month even if workers get paid for periods of more than one month
  • Every hour worked by a worker does not have to meet the NLW, it is the average hourly rate over the pay reference period
  • Benefits in kind such as free parking, tips & gratuities are not to be counted within the calculation.
  • Employers must be careful not to inadvertently underpay when they are operating salary sacrifice schemes
  • There are increased penalties for non-compliance, 200% of arrears to a maximum of £20,000 (unchanged) per worker
  • Employers failing to pay the National Living Wage and the National Minimum Wage will be named publicly

Employers must also be careful not to risk acts of age discrimination; an example being not recruiting younger workers and so avoiding paying the higher rate.

1st April 2016 | Public Sector Exit Payments

Exit payments for high earners (£80,000 +) in the public sector will have to be repaid if the worker takes another role within the public sector in the 12 month period following their ‘exit’.

6th April 2016 | Change in National Insurance Employer Contributions

Employers won’t be liable for employer national insurance contributions for apprentices under 25 until they earn the lower earnings limit of £827.00 a week.

6th April 2016 | Statutory & Compensation Rates

There has been no annual change to the statutory rates for:

  • Maternity pay
  • Paternity pay
  • Adoption pay
  • Shared Parental pay
  • Statutory Sick Pay (SSP)

The capped rate for redundancy payments increases from £475 per week to £479 per week.
Unfair dismissal compensation has a new maximum award of £78, 962

6th April 2016 | Employment Tribunal Powers

Employers that do not pay awards awarded to workers following an employment tribunal claim will now risk a financial penalty of 50% of the outstanding award dependent on minimum and maximum amounts.

 6th April 2016 | Employment Tribunal Postponements

Employment law changes have affected the amount of times a case can be postponed.

This is a quick overview to help employers, please contact us if you require further guidance or need someone to manage your HR for you.   Tel: 01455 231982 | 07716 918272

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