News

October 2008 sees changes in employment law take effect. On 1st October there will be new rates for the National Minimum Wage. On 5th October changes to maternity and adoption leave are introduced and on 27th October changes to agency workers' entitlement to SSP will be introduced.

Implications

All three areas involve rates of pay, entitlement to company benefits and entitlements to SSP. Therefore employers should ensure that those with responsibility for administering pay and benefits are aware of the changes.

Details

National Minimum Wage

The annual increases in the National Minimum Wage will take effect on 1st October 2008. The new rates affect all three rates of the National Minimum Wage including standard, development and young workers. The new National Minimum Wage rates are as follows:- 

  • Standard (adult) rate £5.73 per hour 
  • Development rate £4.77 per hour
  • Young workers rate £3.53 per hour

Maternity and Adoption Leave

As reported in our Newsflash of 10th July, amendments to maternity and adoption leave remove the differences between ordinary maternity/adoption leave and additional maternity/adoption leave for women whose expected week of childbirth (or expected date of placement for adoption) is on or after 5th October 2008.

The changes to maternity and adoption leave follow the implementation of the Maternity and Parental Leave etc and the Paternity and Adoption Leave (Amendments) Regulations 2008. The amendments mean that employers will be required to continue the same terms and conditions (with the exception of pay) throughout the whole period of maternity or adoption leave. Therefore employees on additional maternity leave or additional adoption leave will be entitled to accrue annual leave at their contractual rather than the statutory minimum level, continue to have use of their company cars or company mobile phones and continue to benefit from company gym membership. Employers will also need to treat an employee returning from additional maternity leave or additional adoption leave the same as one returning from ordinary maternity leave or ordinary adoption leave, so that all those returning from maternity or adoption leave will have the right to return to their original job unless that position has been made redundant.

HMRC has published guidance for employers dealing with employees on leave who are entitled to receive non-cash benefits or have a salary sacrifice arrangement. View the HMRC guidance at http://www.hmrc.gov.uk/employers/sml-salary-sacrifice.pdf.

Agency Workers

Finally agency workers on contracts of less than three months were the only group of employees who were not eligible to receive statutory sick pay. The Fixed Term Employees (Prevention of Less Favourable Treatment) (Amendment) Regulations 2008 now give these agency workers the right to be paid statutory sick pay from 27th October 2008.