We focus on the new employment legislation that will come into force on or around 1 October 2016. Various proposals were expected to come into force on or after 1 October 2016 but have been postponed. In particular, the publication and coming into force of the gender pay gap reporting regulations, the reforms to public sector exit payments and the consultation on extending shared parental leave and pay to working grandparents have all been delayed. We do not yet have any commencement dates for the Trade Union Act 2016.
National minimum wage increase
From 1 October 2016 the rates for the national minimum wage will rise as follows (figures in brackets show the current rate):
- Workers aged 21 to 24: £6.95 (£6.70)
- Workers aged 18 to 20: £5.55 (£5.30)
- Young workers aged under 19 but above compulsory school age who are not apprentices: £4.00 (£3.87)
- Apprenticeship rate: £3.40 (£3.30)
National living wage
On 1 April 2016, the new national living wage for workers aged 25 and over came into force at a rate of £7.20 an hour. This rate will not change in October 2016 for those aged 25 and over. This means that the new adult rate of £6.95 will only apply to workers aged 21 to 24 inclusive from that date.
From April 2017 all national minimum wage rates, including the national living wage, will be uprated at the same time.
The Government has published the draft Public Sector Exit Payment Regulations 2016, which will impose a cap of £95,000 on the pre-tax value of exit payments made to most public sector workers. The draft regulations are expected to come into force in Autumn 2016 but not before 1 October. The Government's response to consultation on the reforms to public sector exit payments is still awaited and we are also waiting for the repayment regulations to come into force.
The Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) are introducing a package of new whistleblowing rules designed to build on and formalise the good practices already found in the financial services sector. Most of the proposals were consulted on jointly by the PRA and FCA in February 2015 and were broadly supported by respondents. This has resulted in only minor changes being made to the draft rules, which mainly seek to clarify the intention of the policy.
The aim of the rules is to encourage a culture in which individuals feel able to raise concerns and challenge poor practice and behaviour. The new rules came into force on 7 September 2016. They will apply to deposit-takers with over £250 million in assets, to PRA-designated investment firms, and to insurers subject to the Solvency II Directive (2009/138/EC), as well as to the Society of Lloyd's and managing agents. The rules have the status of "non-binding guidance" for all other firms, who may wish to comply voluntarily (see the PRA supervisory statement).
The rules are intended to work in conjunction with the senior managers regime and the senior insurance managers regime. Relevant firms will be required to:
- Appoint a senior manager as their whistleblowers' champion;
- Establish internal whistleblowing channels and inform staff about these arrangements;
- Inform their staff about the whistleblowing services of the PRA and FCA, as well as informing them of the legal protections offered under the Public Interest Disclosure Act 1998;
- Ensure that wording in employment and settlement agreements does not deter staff from whistleblowing;
- Present a report on whistleblowing at least annually; and
- Notify the PRA or FCA where an employment tribunal finds that a whistleblower suffered detriment or was unfairly dismissed as a result of blowing the whistle.
The new and amended rules can be found in the following PRA and FCA instruments:
Public sector customer-facing workers to speak fluent English
In 2015 the Government consulted on a draft code of practice setting out language requirements for public sector workers. The consultation asked for representations on the draft code, which supports Part 7 of the Immigration Act 2016, under which there will be a new duty for public authorities to ensure that their workers in customer-facing roles speak fluent English (and/or Welsh where appropriate). The Cabinet Office and Home Office have published a code of practice and an impact assessment on the English language requirement for public sector workers.
The public sector language requirements have not been given an implementation date, however the Government has stated it intends to bring these into force in the autumn of 2016.
Under the EU Directive on Disclosure of Non-financial and Diversity Information, companies with more than 500 employees will need to disclose in their management report information on, amongst other things, diversity in their board of directors. On 15 January 2016, the European Commission launched a public consultation on the methodology for reporting. The Directive is due to be implemented by 6 December 2016 and the Commission is preparing non-binding guidelines on the methodology for reporting by December 2016.
The Government's follow-up consultation on gender pay reporting closed on 11 March 2016 and the Government's response to the consultation, together with the final version of the regulations, is awaited. It was originally expected that the final regulations would be published in the summer of 2016 and come into force on 1 October 2016. However, the GEO now envisages that the regulations will be laid before Parliament in the autumn and will commence in April 2017. If this is the case, it is likely that the first relevant date under the regulations would remain at 30 April 2017 as previously announced, meaning that the first gender pay gap reports will be due by the end of April 2018.
Extension of shared parental leave to working grandparents
In 2015, the Government stated its proposal to extend shared parental leave to working grandparents by 2018. It had intended to undertake consultation on how to implement the proposal in May 2016 but it delayed the consultation until after the EU referendum. We await further details of the consultation.