26 February 2016

A Quick Glance at the Year Ahead in Employment Law

A quick glance at the year ahead in Employment Law

1 April 2016:

A compulsory National Living Wage will be introduced and set at £7.20. Punishment for non-payment by employers will be 200% of the sum owed unless paid within 14 days, with a maximum fi ne of £20,000.

3 April 2016:

Statutory maternity, paternity, adoption and shared parental pay rates are frozen for 2016 at £139.58 per week. Whilst there is no statutory requirement for this rate to increase, it usually increases each April in line with the Consumer Price Index, which unfortunately fell by 0.1% in 2015. The first six weeks of maternity pay are payable at 90% of the employees average weekly pay. Thereafter employees are entitled to a further 33 weeks at the statutory maternity rate set by the Government, or 90% of their weekly earnings if lower than the statutory rate. Sick pay is likewise frozen at £88.45 per week this year.

6 April 2016:

The income tax personal allowance is due to increase to £11,000 for 2016 – 2017 and £11,200 for 2017 – 2018. Additionally, the basic rate limit will be increased to £32,000 for 2016 – 2017 and to £32,400 for 2017-2018. Consequently the higher rate threshold will be £43,000 in 2016-2017, increasing to £43,600 in 2017-2018.

Dates to be confirmed:

The Government will be rolling out Fit for Work throughout 2016, which aims to help manage sickness absence at work by providing advice to both employers and employees when a health condition starts affecting an individual’s job. Free advice will be available via web and telephone. After a 4-week absence, an employee can consent to being referred to Fit for Work for an assessment by either their GP or their employer. A Return to Work Plan may then be issued with advice and recommendations on a phased return to work. Upon implementation there will be no obligation on the employer to take any action. It is however advisable for employers to update any sickness and absence policies to notify employees of the availability of this new Fit for Work scheme. The aim of this scheme is to encourage employees to either stay at or return to work. Additionally, it could potentially reduce employers sick pay costs by helping employees get back to work sooner.

Gender pay gap reporting is likely to become compulsory this year, aiming to identify and close any pay differences. Businesses with 250 or more employers will be required to conduct an equal pay review and publish data revealing whether or not there are differences in pay between the genders.

The current focus for most this year is however the forthcoming EU referendum, with a potential early referendum date being mooted for June 2016. Recent YouGov research suggests that the business community in the UK is somewhat fragmented on the issue. Whilst the large businesses have mostly been voicing strong opposition to what is now being referred to as “Brexit”, YouGov reports that some small and medium enterprises are taking a more Eurosceptic stance.

Emma Barlow

Emma Barlow
Solicitor