There are a number of important changes in employment law coming into force in the coming months. Effective from 1 October 2016, there will be changes to the national minimum wage rates, followed by the introduction of the apprenticeship levy, gender pay gap reporting, and immigration rule changes in April 2017. We have also highlighted a number of developments where we are still awaiting implementation dates.

Effective from October 2016 onward

National minimum wage rates: Changes to the national minimum wage rates will be:

  1. An increase from £5.30 to £5.55 in the development rate;
  2. An increase from £6.70 to £6.95 in the standard adult rate;
  3. An increase from £3.70 to £4.00 in the young worker’s rate;
  4. An increase from £3.30 to £3.40 in the apprenticeship rate; and
  5. The national living wage will remain unchanged at £7.20.

Effective from April 2017 onward

Apprenticeship levy: For those employers with a salary bill exceeding £3 million, a 0.5% levy will become payable in April 2017. Under the new funding system employers in England who pay the levy will be able to spend funding through the digital system on apprenticeship training and end-point assessment. Although some guidance has been published by the Westminster Government in relation to how the scheme will operate in England and Wales, the Government has said that additional guidance will be published in October. In Scotland a consultation on the operational aspects of the levy closed on 26th August 2016 and the Scottish Government’s response has yet to be published. For more information on how the levy may affect your organisation please join our webinar on 3rd of November at 1.15.

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Gender pay gap reporting: Applying to employers in the private, public and third sector with 250 or more employees, organisations in scope will be obliged to publish their mean and median gender pay gap and the distribution of men and women working across four equally divided pay quartiles. Employers will also have to disclose bonus pay gaps between men and women and the proportion of each gender receiving a bonus over a 12 month period. The GPG regulations will come into force in April 2017, which is the same date when the first data snapshot should take place. The latest date for publication of this data is April 2018. We are advising employers to carry out a trial run before April 2017. If you would like more information on conducting a trial run then please contact us. Or for more information on preparing for publication please visit our Gender Pay Gap Toolbox site.

Immigration rule changes: The government is looking to implement the following changes:

  1. The introduction of a requirement that public authority employees in customer facing roles will be fluent in English;
  2. The ability of an immigration officer to close a place of work within 48 hours where they find or suspect illegal working and the employer cannot provide evidence of complying with work check requirements;
  3. An immigration skills charge which will be applied to employers who sponsor non-EEA nationals under a Tier 2 work visa.

We understand the skills charge will come into force in April 2017, the other two changes mentioned above may come into force before that date.

Implementation dates still to be confirmed

Industrial action: Despite receiving Royal Assent earlier this year, we are still awaiting implementation dates for the various parts of the Trade Union Act 2016, which will limit the way in which industrial action is called in the UK. Trade unions will only be able to institute industrial action if there has been a minimum ballot turnout of 50%. Time limits and notice requirements are also expected to change under this regime.

Public sector exit payments: Applying to public sector employees, a £95,000 cap on total aggregate value of exit payments with a potential requirement to repay if reemployed by the public sector within 12 months. The Government is expected to announce the date where the rule change comes into force in the short term.

Tax-free childcare scheme: The Government will cover 20% of annual childcare costs to a maximum of £2,000 per child for families who earn less than £100,000 annually and earn a at a minimum a 16 hour weekly income at the national minimum wage. Both parents must be working and have children under the age of 12.

Rights of Sunday shop work notice periods: It is expected that the Government will consider changes to notice periods relating to Sunday work opt outs from 3 months to 1 month and to enable employees to object to working more than normal hours on Sundays.