Gender pay gap reporting
Employers with 250 or more employees will have to report data every year about their gender pay gap, including bonus payments. They will also have to report on the proportion of male and female employees in different pay quartiles and those who receive bonuses. Employers in the private and voluntary sector must base their pay data on staff employed on a "snapshot" date of 5 April each year, starting from April 2017. Bonus information must be based on the preceding 12-month period. Organisations in the public sector must use 31 March as their snapshot date. Employers have 12 months to publish the information on their own website and to upload it to a Government website.
Acas have produced a range of guidance documents to assist employers in meeting their statutory obligations.
The apprenticeship levy to fund apprenticeship training is due to come into effect on 6 April 2017. Employers will pay the monthly levy via PAYE if they have a pay bill of more than £3 million. Employers in England that pay the levy will be able to access funding through a digital service. The new system of funding is expected to operate from 1 May 2017. HMRC have produced aguidance document on the apprenticeship levy and the DfE have produced guidance on ‘Apprenticeship funding: how it will work’.
In the public sector, the Public Sector Apprenticeship Targets Regulations 2017 set a target of at least 2.3% apprenticeship starts each year, which will apply to prescribed public bodies with 250 or more workers in England.
From 1 April 2017, it will be an offence for a person to provide or offer a course or training as an apprenticeship in England if it is not a ‘statutory apprenticeship’ under S.A11 in Chapter A1 of Part 1 of the Apprenticeships, Skills, Children and Learning Act 2009.
Reform to the intermediaries rules (IR35) in the public sector
The intermediaries rules (IR35) may apply where an individual supplies his or her services to a client via an intermediary, such as a personal service company. From 6 April 2017, all payments made by public sector engagers to workers supplied by personal service companies will be treated as payments of employment income on which either the engager or third-party intermediary will be required to account for tax. The public authority will have responsibility for establishing if the intermediaries rules apply and, if they do, making the tax and NIC deductions.
HMRC have updated their guidance on IR35 - Working through an intermediary and published new guidance on off-payroll working, which provides further advice on preparing for the introduction of the new legislation, including specific guidance for agents.
Public sector reporting of trade union facility time
The Trade Union (Facility Time Publication Requirements) Regulations 2017 come into force on 1 April 2017 requiring specified public sector employers to publish information relating to time off taken by trade union representatives for trade union duties and activities, referred to as "facility time".
Tax advantages under salary-sacrifice arrangements to be limited
On 23 November 2016, in the Autumn Statement, the Chancellor confirmed that the current tax and NICs relief on salary sacrifice arrangements would be scaled back from April 2017. The only benefits that will continue to benefit from tax and NICs relief if provided through a salary sacrifice arrangement are enhanced employer pensions contributions, childcare benefits, equipment provided under the cycle to work scheme and ultra-low emission cars. Existing arrangements will be protected until April 2018 (or April 2021 for cars, accommodation and school fees).
National minimum wage increases
On 1 April 2017, the rates of the national minimum wage will increase, despite an increase in most rates on 1 October 2016. This is so that the timing of the annual increase in the national living wage rate for workers aged 25 or over can align with the other national minimum wage rates. The following hourly rates of national minimum wage will apply from 1 April 2017:
- The national living wage (workers aged 25 and over) is £7.50.
- The standard adult rate (workers aged between 21 and 24) is £7.05.
- The development rate (workers aged between 18 and 20) is £5.60.
- The young workers rate (workers aged under 18 but above the compulsory school age who are not apprentices) is £4.05.
- The rate for apprentices is £3.50.
From 1 April 2017, the accommodation offset will be £6.40 each day.
Statutory family-related pay and sick pay rates increase
For Statutory Adoption Pay, Statutory Maternity Pay, Statutory Paternity Pay and Statutory Shared Parental Pay, the weekly earnings threshold will increase from £112.00 to 113.00 and the Standard Rate of pay will rise from £139.58 to £140.98 for pay weeks commencing on or after 2 April 2017.
The Statutory Sick Pay weekly earnings threshold will increase from £112.00 to £113.00 and the Standard Rate will rise from £88.45 to £89.35 from 6 April 2017.
Tribunal awards and statutory payments
The Employment Rights (Increase of Limits) Order 2017 increases the limits applying to certain awards of employment tribunals, and other amounts payable under employment legislation, from 6th April 2017. The increases in the Schedule to the Order apply where the event giving rise to the entitlement to compensation or other payments occurred on or after 6th April 2017. The key changes are as follows:
- The limit on the amount of compensatory award for unfair dismissal increases from £78,962 to £80,541.
- The maximum amount of “a week’s pay” for the purpose of calculating a statutory redundancy payment or for various awards including the basic or additional award for unfair dismissal increases from £479 to £489.
- The minimum basic award in cases where a dismissal is automatically unfair because of health and safety, being a trustee of an occupational pension scheme or an employee representative, or because of trade union membership or activities, increases from £5,853 to £5,970.
The aim is to provide summary information and comment on the subject areas covered. While every care has been taken in compiling this information, SM&B cannot be held responsible for any errors or omissions, or changes to legislation implementation dates. Specialist legal advice must be taken on any legal issues that may arise before embarking upon any formal course of action.