Employment Changes from 6th April 2017
Gender Pay Gap Reporting
The Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 will come into force, requiring all employers with 250 more employees (as at 5 April 2017) to collate and publish their gender pay gap information. This will entail considering the pay of all “relevant employees” and reporting the pay information depending on the “quartile bands” within the workforce.
Changes to Compensation
The following changes to compensation shall also come into effect:
- The statutory limit on the amount of a week’s pay for the purposes of calculating compensation (ie statutory redundancy payments and the basic award for unfair dismissal) will increase from £479 to £489;
- The maximum compensatory award for unfair dismissal increasing from £78, 962 to £80,541, or one year’s salary if this is less than the statutory maximum; and
- The penalty for failing to provide a written statement of terms (a contract of employment), which is capped at two or four weeks’ pay, shall increase from £958 (or £1,916) to £978 (or £1,956).
The Income Tax (Pay as you Earn) Regulations 2017 will impose a duty on all UK employers with an annual pay bill of over £3million to pay an apprenticeship levy at a rate equivalent to 0.5% of their payroll costs. Employers will receive an allowance to offset against the levy but this may remain a sizeable cost, and one which many employers are unaware of.
Immigration Skills Charge
Employers sponsoring skilled migrants under the Tier 2 (General) and Tier 2 (intra Company Transfer) categories will be expected to pay a Skills Charge per sponsored worker, per year, at the rate of £1,000 for larger employers and reduced rates for smaller sponsors and charities. Employers should consider whether they are caught by this requirement of fall within one of the categories of exemption.