New National Minimum Rates announced

Effective from April 2018, the Chancellor Philip Hammond confirmed in his Autumn budget, national minimum wage increases and a new scheme affecting care sector employers who may have underpaid their employees.

New National Minimum Wage Rates

In line with the intention for the national minimum wage to increase to £9 per hour from 2020, it will increase from £7.50 to £7.83, representing a 4.4 percent uplift.  In practical terms, this will mean a pay rise of around £600 per year for a full time worker.

The other rates will increase as follows:

  • Workers aged 21-24 from £7.05 to £7.38 per hour
  • Workers aged 18-20 from £5.60 to £5.90 per hour
  • Workers aged 16-17 from £4.05 to £4.20 per hour
  • Apprentice rate from £3.50 to £3.70 per hour

The Budget was also used to announce a review of the flexibility in the way organisations may use their apprenticeship levy (large companies have been required to pay this levy since April 2017 which they can then use to fund apprenticeships) and a National Retraining Scheme to support worker’s career development.

Care employers advised to correct minimum wage wage under payments

A new scheme to encourage companies in the care sector to make good any minimum wage underpayments was launched on 1st November 2017.

Recent employment tribunal judgements have shifted a focus onto a companies minimum wage obligations in the specific area of sleep-in shifts.  HMRC’s interpretation of the legislation, in common circumstances, requires that all hours of a sleep-in shift attract the minimum wage, regardless of whether the worker is asleep.

In order to soften the impact of these decisions on social care companies, the Social Care Compliance Scheme (SCCS) will see any underpayments corrected but remove the enforcement measures applied to companies that are found to have underpaid their workers. Employers have until the end of 2018 to join up to the scheme.

Committees publish draft bill on gig economy workers

A joint draft bill containing enhanced proctections for gig economy workers has been published by two government committees.

The propsal focuses on giving individuals more certainty about their status by providing an automatic assumption of “worker” status, meaning that it would be for the company to prove otherwise at employment tribunal.  This would also mean that these workers would be entitled to certain employment rights from day one.

Some recommendations from the Taylor Report are also included in the Bill, such as considerations of a higher national minimum wage rate for those on zero hour contracts. The government is yet to provide its full response to the review and this Bill will add more pressure on the government to take action.

If you need any help or guidance on the above, get in touch with HR Revolution.

Give us a call +44 203 538 5311 or email: hello@hrrevolution.co.uk or visit www.hrrevolution.co.uk  where our expert CIPD HR professionals are waiting to help you with any questions you may have.

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A version of this article first appeared on CIPD HR-inform.

Hung parliament – what does it mean for HR and employment law?

We have a new government of sorts, after all the campaigning, the Conservative party didn’t get enough votes to form a majority government meaning they will be forming a minority government in alliance with the Democratic Unionist Party.

The main priority for the Government will be Brexit negotiations but the following points will be good to keep an eye out for:

  • There will be lots of attention to those working the in the “gig economy” and the introduction of legislation to make clear their worker/employed status.
  • There could be limited changes to National Insurance payments – they could rise but this has not be stated clearly yet.
  • It is likely there will be an increase in the personal tax allowance to £12.5k and £50k for higher tax payers.

Things for businesses to look out for

Brexit negotiations around the rights to work, both for UK and EU nationals and EU workers currently in the UK, should be kept under careful review for any developments.

With increased attention on the “gig economy”, it may result in the re-assessment of contracts between businesses and self-employed workers and will also require greater analysis of the status of an employee, worker or contractor.

If you need any HR advice give us a call, we are here to help +203 538 5311 or email: info@hrrevolution.co.uk

HR Revolution – www.hrrevolution.co.uk

 

How will the political parties manifestos effect employment and HR?

Today, Thursday 8th June is the General Election 2017, where the people of the UK will head to the polls and elect a new government.

So what is each political party pledging around employment, talent and pensions? and which of the major parties’ policies will affect HR?

All the main parties have focused on employment matters and worker rights as fertile ground for winning votes – perhaps more than ever before.

Here’s our detailed round-up of who’s pledging what:

The Conservative party will:

  • Introduce a national retraining scheme. Under it the costs of training will be met by the government, with companies able to use the apprenticeship levy to support wage costs during the training period
  • Continue the campaign for fairer corporate governance. The party has stated that there will be new rules for takeovers and executive pay, with proposals around annual shareholder votes on pay packages and a requirement to publish pay ratios
  • Reduce the ‘triple lock’ on pensions to a ‘double lock’, with the state pension to rise by the higher of average earnings or inflation
  • Not increase VAT, but scrap a 2015 election pledge not to raise income tax or National Insurance
  • Make universities that are charging maximum tuition fees sponsor academies or help found free schools
  • Retain all workers’ rights currently guaranteed by EU law
  • Put worker representation on listed company boards
  • Introduce a statutory right to a year’s unpaid leave to care for a relative, and statutory leave for parents whose child has died.

The Labour party will:

  • Ban zero-hours contracts and unpaid internships
  • Raise the minimum wage to £10 by 2020 and scrap the public sector pay cap
  • Abolish university tuition fees
  • Offer an immediate guarantee about the status of EU nationals in the UK
  • Stop all planned increases to the state pension age after 66
  • Give all workers equal rights from day one, whether they’re part time or full time, temporary or permanent
  • Repeal the Trade Union Act and roll out sectoral collective bargaining
  • Guarantee trade unions a right to access workplaces
  • Abolish employment tribunal fees
  • Double paid paternity leave to four weeks and increase paternity pay
  • Strengthen protections against unfair redundancy for women
  • Create a million “good jobs” and rebalance the regions through setting up a National Investment Bank (which will leverage enough private finance to invest £250 billion in infrastructure over 10 years), a network of regional development banks, and a national transformation fund
  • Add four new public holidays per year.

The Liberal Democrats will:

  • Initiate a second EU referendum, with an option to remain in the EU
  • Expand Shared Parental Leave with an additional ‘use it or lose it’ month to encourage fathers to take time off with young children
  • Unilaterally guarantee the rights of EU nationals in the UK
  • Strengthen worker participation in decision-making, including staff representation on remuneration committees and the right for employees of a listed company to be represented on the board
  • Introduce a ‘good employer’ kitemark covering areas such as paying a living wage, avoiding unpaid internships, and using name-blind recruitment
  • Introduce a right for those on zero-hours contracts to request a fixed contract. The party would also consult on rights to request more regular working patterns
  • Aim to double the number of businesses hiring apprentices.

The Green Party will:

  • Phase in a four-day working week with a maximum of 35 hours
  • Scrap age-related wage bands and raise the national minimum wage to living wage levels for all
  • Take steps towards the introduction of a universal basic income
  • Introduce a ban on exploitative zero-hours contracts
  • Reduce the gap between the highest and lowest paid
  • Ensure a minimum 40% of all members of public company and public sector boards are women
  • Abolish the cap on National Insurance contributions so the wealthiest pay more
  • Provide free early education and childcare for all children, with formal education starting at age seven
  • Initiate a referendum on the detail of whatever deal is negotiated for Britain’s departure from the EU, with the option to reject the deal and remain in the EU
  • Immediately guarantee the rights of EU citizens to remain in the UK and urgently seek reciprocal arrangements for UK citizens living in the EU.

UKIP will:

  • Declare 23 June Independence Day, and make it a bank holiday
  • Introduce a flexible state pension window, so people can opt to retire earlier for a lower state pension or work longer for a slightly higher pension, as is the case at the moment
  • Bring forward legislation requiring employers to advertise jobs to British citizens before they offer them overseas.

The SNP will:

  • Devolve to allow Scotland to have its own policies after Brexit
  • Guarantee a living wage to all adults aged 18 and over
  • Lobby for the scrapping of the Skills Immigration Charge – a charge for employers of £1,000 per non-EEA worker per year
  • Call for the full reinstatement of the Post-Study Work Visa scheme, which allows foreign students to stay in the UK after graduation
  • Increase free childcare to 30 hours a week by 2020
  • Ensure companies engaging in blacklisting or ‘exploitative’ zero-hours contracts are barred from publicly-procured contracts
  • Incentivise oil and gas businesses to invest in renewables to protect jobs in the energy sector.

HR Revolution – www.hrrevolution.co.uk

A version of this article first appeared in HR Magazine

Key Employment law changes to look out for in April 2017

April is a busy time for HR Revolution and business owners alike. Not only are we required to tie up any loose ends from the previous financial year… We also need to make sure that we’re fully prepared for legislative changes that could impact on our and our client’s businesses.

This is a time when new rules come into force, so there’s no space right now for burying your head in the sand. You need to be prepared, and you need to take action.

Here’s what you need to know:

National wage is set to increase

On 1st April, the national minimum wage will increase from £6.95 to £7.05  For workers aged 25 and over, the national living wage rate will increase from £7.20 to £7.50.

As the rate varies according to age group, now is a great time to make sure that you’re compliant, and that payroll processes are in order.

Statutory redundancy pay will rise

New rules around redundancy pay will be rolled out from 6th April. If you have to make employees redundant, then you must pay those with two years’ service a sum based on their length of service, weekly pay, and age.

The weekly pay is subject to a maximum amount, and this will rise from £479 to £489.

Statutory maternity pay will rise

Statutory rates for maternity pay, paternity pay, shared parental pay, adoption pay will rise from £139.58 to £140.98 on 2nd April.

Statutory sick pay will rise

The rate of statutory sick pay is also increasing from £88.45 to £89.35. This increase is expected to occur on 6 April 2017.

To be entitled to these statutory payments, the employee’s average earnings must be equal to or more than the lower earnings limit.

The lower earnings limit is increasing from £112 to £113 in April 2017.  This is the first rise since the rates were frozen in April 2015.

Gender pay gap reporting comes into force

If you employ 250 or more employees, then this applies to you. You will be required to report on your gender pay gap, including any bonuses that you might use to reward your staff.

You’ll have a period of 12 months to publish this information on your own website, and upload the details to a government website. As such, you need to make sure that you have mechanisms in place to collect the necessary facts and figures.

Immigration skills charge will be introduced

Do you sponsor skilled workers under tier 2 of the immigration points-based system? If so, you will be required to pay a sponsorship levy of £1,000 per year for each certificate of sponsorship – or £364 if you’re a smaller business or charity.

There are certain exemptions that apply, so if your business hires skilled immigrants, it pays to seek out tailored advice.

Depending on the size of your business and other factors that may be at play, there are further changes that you need to be aware of. April is a fantastic time to carry out an audit of your policies and procedures, to make sure that you’re fulfilling your legal responsibilities.

With that in mind, pick up the phone and get in touch +44 203 538 5311 or email: info@hrrevolution.co.uk. We can arrange to have a discussion around the changes that you may need to implement in coming weeks, so you can move into the new financial year with the peace of mind that comes with knowing that everything is under control.

HR Revolution – www.hrrevolution.co.uk