As we ring in 2017, let us brace ourselves for the employment law changes set to come into force this year. Please find a roundup of these changes listed below to ensure you have a head start to the year ahead.
Trade Union Act: important public services - 1 March 2017
The Trade Union Act 2016 reforms strike balloting requirements for those working in ‘important public services’. New balloting rules under the Trade Union Act 2016, require an overall turnout of 50% of eligible voters to authorise industrial action. For employees in important public services an additional threshold applies, whereby 40% of eligible voters must vote in favour of a strike.
The government has now produced five sets of draft regulations specifying the categories of important public service workers covered by the additional 40% threshold. They include:
- Hospital services such as A&E, intensive care, psychiatric and emergency midwifery services
- Teachers of compulsory school age children and those working in further education
- Fire-fighters and fire and rescue service personnel organising emergency responses
- London bus, national rail and tramway personnel including maintenance workers, and air traffic control, airport and port security services
- Border control, sea patrol and border intelligence personnel
Once approved by Parliament, the Regulations will come into force on 1 March 2017 or, if Parliament has not approved the rules by then, 21 days after approval.
Apprenticeship levy - 6 April 2017
Set to come into force from 6 April 2017, the Apprenticeship Levy will require all employers from both public and private sectors operating in the UK and with an annual pay bill over £3 million, to fund apprenticeships at a rate of 0.5% of their total annual pay bill. It only applies to UK companies and each employer will receive a fixed “levy allowance” of £15,000 to offset against their levy payment. The levy is not voluntary. Those who meet the criteria must pay even if they do not currently use apprentices. The Government aims to fund three million new apprenticeships in England by 2020.
National Living Wage - April 2017
On 1 April 2016, a new rate of £7.20 for workers aged 25 and over, known as the National Living Wage (NLW) was introduced. Chancellor Phillip Hammond announced the rise of 4% from £7.20 to £7.50 an hour in the Autumn Statement.
Following NLW and National Minimum Wage (NMW) rates would apply from April 2017:
- The rate for workers aged over 25 years (NLW) will increase to £7.50 per hour
- The rate for workers aged 21 to 24 years will increase to £7.05 per hour
- The development rate for 18 to 20 year olds will increase to £5.60 per hour
- The rate for 16 to 17 year olds will increase to £4.05 per hour
- The apprentice rate will increase to £3.50 per hour
Gender Gap Reporting- April 2017
All private and voluntary sector employers in England, Wales and Scotland with at least 250 employees will be required to publish information annually about the differences in pay between men and women in their workforces. Subject to the approval of Parliament, the regulations are likely to commence from 5 April 2017, from which point employers will have up to 12 months to publish this information. The report must be published in English, by April 2018, on a company website that is accessible to employees and the public.
Salary Sacrifice Tax Restrictions- April 2017
From April 2017, the tax advantages of salary sacrifice schemes will be removed. However, certain long-term arrangements will be protected until April 2021, according to the chancellor. Salary which is sacrificed will no longer receive special treatment; instead it will be subject to tax and employer’s National Insurance as normal. Salary sacrifice schemes for ultra-low emission cars, pensions saving, childcare and the cycle to work scheme will be exempt from the changes.