We all know that the law isn’t static. It’s forever changing, and it’s super important to keep up to date with any changes in policy and regulation that come about
An important one to keep up to speed with is employment law changes. As an employer, it is your duty to make sure you make any important, relevant changes and to ensure your business is aligned as such
With that in mind, here are 5 key dates you should be adding to your 2021 calendars:
April 1st – The date that the National Living wage and National Minimum Wage will be increasing
Here are the increases for each age group:
Age 23+ will see a 2.2% increase to £8.91 (NLW)
Age 21-22 will see a 2% increase to £8.36 (NMW)
Age 18-20 will see a 1.7% increase to £6.56 (NMW)
Age 16-17 will see a 1.5% increase to £4.55 (NMW)
Apprentices will see a 3.6% increase to £4.30 (NMW)
April 4th – Gender-Pay Gap Reporting
The Equality Act 2010 requires all companies with over 250 employees to report on the gender pay gap. This is a legal requirement, and the results must be published on the gender pay gap reporting website by April 4th each year. Denying this report breaches the Equality Act 2010 and may result in legal action by the Equality and Human Rights Commission. However, due to the ongoing pandemic, the reporting on this has been pushed back to October 5th, 2021. Those who can submit the report before October are advised to do so!
April 4th – Increase to Statutory Pay
The government will increase other types of statutory pay: including maternity, paternity, adoption, parental bereavement, and shared parental pay. (Up to £151.92 from £151.20) Statutory sick pay will also be increased to £96.35!
April 6th – IR35
Guess who’s back? Back again! Yes, its IR35!
IR35 basically concerns contractors; making sure they are being paid properly for their business structure and not avoiding tax payments. This was postponed last year due to the pandemic (like everything else!). Nevertheless, this year, IR35 is being extended to the private sector. These rules will now apply to ‘contractors’ who provide services to clients in the private sector, where the type of work would be classed as an ‘employment’ relationship specifically for tax purposes, (usually through a limited company). Limited companies with 1 shareholder or director are most likely to get caught out on this
If you look like a 3rd party provider, you have nothing to worry about. HMRC will certainly have an issue if you look like an employee operating as a limited company. This is something that you need to be aware of!
So what can employers do?
Get up to speed with the changes ASAP
Determine if IR35 applies to you
Develop a plan on how to implement IR35 if it applies
Make sure you have as solid contract in place
Contracts = the key thing to consider when it comes to IR35
April 30th – Extended Furlough Scheme
Pretty much the whole of the UK is still in lockdown. This means a bunch of businesses unfortunately won’t be opening yet. Because of this, the furlough scheme has been extended until the end of September. The scheme will continue to cover 80% of furloughed employees wages, which is capped at 2.5k per month. It’s incredibly important for employers to be aware that in July 2021, the government will pay 70% of employees’ wages while employers will pay 10%. In August this will increase to 20% for employers and decrease to 60% for the government. You can keep up to date on this on the government website.
I’d urge all employers to take a note of these changes. Employment law can be an intricate and tricky subject, but as we know all employers need adhere to all of the relevant legislation. If you need advice, you can find up to date information on the government website!