Our colleagues at Triple Three Solutions have identified some important changes in HR law that will start to appear in 2017
Here we are three months into the new year, and as a company offering help with HR in Cheshire and Manchester we have already seen some significant changes to employment law coming into force this year, and there are more changes ahead. From trade union balloting to the apprenticeship levy, here is a round-up of some of the fundamental changes we will face this year:
Apprenticeship Levy Introduced
From April 6th, 2017, all employers who have a wage bill amounting to £3 million or more, will have to pay a 0.5% apprenticeship levy on their total pay bill. This then enables them to access the levied amounts to pay for apprenticeships in England, and they also qualify for a 10% top-up from the Government if they spend all their tax on apprentices. Smaller companies who have wage bills less than £3 million can still benefit from this levy as if they contribute 10% of the cost of an apprenticeship the Government will pay the rest of the cost. The purpose of this tax is to encourage employers to invest in apprenticeship programmes by raising additional funds to help improve the quality and quantity of apprenticeships.
Employing Foreign Workers
There have been a number of changes to the rules governing foreign workers, with the most important being the ones affecting those employers who sponsor foreign workers holding a two-tier visa. From April, this year, these employers will have to pay an immigration skills charge of £1000 per employee (or £364 if they are a smaller company or a charity). This immigration skills charge is payable on top of the existing fee for a visa application. However, it is expected that the minimum salary threshold for experience workers who wish to apply for a Tier 2 visa will increase to £30,000 from April this year. There will also be some transitional arrangements put in place for those who have already been granted leave to remain under Tier 2 (General) and those who have applied for Tier 2 before 25th November 2016.
Gender Pay Gap Reporting
Recent changes in the law mean that by 4th April 2018 private and voluntary sector organisations who employ 250 people or more, must publish details of their gender pay gap. This is important to note this year as employers will need to use data from 2016/2017 for their first reports.
General Data Protection Regulation Compliance
Although this is not due to come into effect until May next year (2018), employers should start preparing themselves for the EU General Data Protection Regulation (also known as GDPR). The details of this could mean that you need to make changes to any policies and procedures you have that relate to subject access requests, responses to any breach of the Data Protection Act and privacy notices. On top of this, employers should check that any personal data they keep about employees meets GDPR conditions for employee consent. It is important to be aware of GDPR and ensure you are complying with it as you could face fines of up to £20 million (or 4% of your annual turnover) if you do not comply.
National Minimum Wage Changes
The national minimum living wage for employees who are 25 or over is due to rise to £7.50 on or after the 1st April 2017. There are also other smaller increases to other national minimum wage rates, such as the apprentice rate and the adult rate.
Public Sector Exit Rates Restricted
There is an expectation that exit payments within the public sector will be restricted from next year, with a cap of £95,000 on payments for loss of employment: (including redundancy pay, voluntary exit payments, or other payments. On top of this, there is now a separate measure in place which requires employees who earn over £80000 to repay some or all of their exit payment if they return to a public-sector role within 12 months of leaving their existing role.
Salary Sacrifice Schemes Dropped
After 6th April 2017, there will be changes to some salary sacrifice schemes meaning they won’t continue to offer the same tax and National Insurance contribution savings. These changes will not affect savings on Pensions, childcare and cycle-to-work schemes. Schemes that have been put in place before April 2017, such as private medical insurance, gym membership and so on) will be able to continue until April 2018. Long-term arrangements relating to cars, accommodation and school fees can continue until April 2021.
Trade Union Balloting
As we write this blog, we are still awaiting an announcement on the start date for changes to trade union balloting for strike action – with the changes meaning that a vote for strike action needs a minimum 50% turn out and a majority vote to be upheld. For essential public services, such as education, fire, health and transport, 40% of eligible voters will need to vote in order for the action to be upheld. The new regulations are due to come into force on the 1st March this year, or if Parliament has not approved them by then, 21 days after the date of approval.
To find out more about any of these changes in employment law, or what HR help we can offer you, please give us a call on 0161 300 1214 or send an email to firstname.lastname@example.org