In this month’s blog, we thought it would be useful to give a round of up the employment law changes that are set to take place during 2017:
Implementation of Gender Pay Gap Reporting:
The final version of the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 has now been published. This outlines how organisations that employ more than 250 people should calculate and report on the gender pay gap. The Gender Pay Gap is the difference between women’s and men’s average, weekly, full-time equivalent earnings, expressed as a percentage of men’s earnings.
We expect the new legislation to take effect from 6th April 2017 and, if you employ more than 250 people, the deadline for you to publish your first report (which will be based on pay and bonus data from 2016/17) on your website is expected to be 5th April 2018. PeoplePoint 365 HRMS from PointSolutions can be configured to provide this report dynamically as part of the Remuneration and Benefits reporting features. The report could even be published directly from the SharePoint based system to your website to provide extra efficiency and save-time.
Affecting only larger SMEs, the Apprenticeships Levy is a payment of 0.5% towards the cost of apprenticeship training that will be collected from all UK public and private sector employers with a payroll of more than £3 million per year. The payment will be paid to the HMRC through PAYE returns.
The aim of the Apprenticeship Levy is to encourage employers to invest in apprenticeship programmes and to raise additional funds to improve the quality and quantity of apprenticeships. The same businesses can then use the levy to support apprenticeship training in their business.
The levy is scheduled to come into effect in April 2017.
General Data Protection Regulation (GDPR):
Affecting all organisations, irrespective of size, the aim of the GDPR is to strengthen data protection for individuals within the European Union and to deal with the exportation of personal data outside the EU.
It’s not due to come into play until May 2018, but, with the help of a data protection expert, employers should use 2017 to carry out an audit of their current data protection practices. This will enable them to make sure that they have correct and adequate processes in place for getting employees’ consent to collect and process their personal data.
You may be wondering why, given the UK’s imminent exit from the EU, the GDPR would affect UK employers? Well, as it’s due to come into force before we leave the EU, organisations that aren’t compliant by the date that it takes effect may be fined the higher of up to £20 million or 4% of annual turnover.
Restriction of Salary-sacrifice Schemes:
You may need to rethink the employee benefits that your organisation offers, given the fact that from April 2017, the government will massively limit which ones will attract tax and employer National Insurance advantages when offered to employees through a salary-sacrifice schemes.
Pensions and pensions advice, childcare, bikes-for-work schemes, and ultra-low emission vehicles (ULEVs) won’t be affected by the changes. Equally, those schemes that were in place before April of this year will be protected until April of next year and salary sacrifice schemes relating to accommodation, cars and school fees will be protected until 2021. PeoplePoint 365 Asset Management for SharePoint and Office 365 provides the flexibility and reporting needed to keep on-top of these changes.
Changes to Rules for Employing Foreign Workers:
Again, affecting all organisations, from April 2017, employers that sponsor foreign workers with a Tier 2 visa (visa for experienced workers) will have to pay an immigration skills charge (on top of the current fees for visa applications) of £1000 per worker (£364 for small employers / charities).
Additionally, the minimum salary for workers applying for a tier 2 visa will increase to £30,000 per year from April 2017. However, Nurses, Radiographers, Paramedics and secondary school Teachers in Maths, Physics, Chemistry, Computer Science and Mandarin will be exempt from this until July 2019. This is with the aim of avoiding a recruitment crisis in the healthcare and education sectors, where jobs currently attract lower rates of pay.
The alerts function of PointSolutions’ Sharepoint HRMS’s Employee Records Management module is a fail-safe way of helping you to keep track of the expiry date of employees’ visas.
Increase to Statutory Payments:
Statutory adoption, maternity, paternity and shared parental pay will increase from £139.58 to £140.98 per week;
Statutory sick pay will rise from £88.45 to £89.35 per week
To qualify for these payments, employees’ average earnings must equal or be more than the lower earnings limit, which from April 2017 will increase from £112 to £113.
Don’t forget though, employers can reclaim 92% of statutory maternity, paternity, adoption and shared parental pay and smaller employers that pay less than £45,000 in Class 1 National Insurance can reclaim the full amount.
The National Living Wages (NLW) rate changes every April, but the National Minimum Wage (NMW) rates usually change in October. Things are set to become easier to keep track of, however as from April 2017 the NMW and NLW cycles will be aligned, so that both rates change in April each year.
And finally, hopefully during 2017 we’ll start to get more information about the impact of Brexit on employment law. We’re not promising anything, but will be posting HR related updates on our blog!