Employment Law April 2017 Rate Changes Image

Employment Law: April 2017 Rate Changes And Other Changes

There are a number of changes in employment law that take effect during April 2017, including rate changes in a number of key employment law areas. The employment law April 2017 rate changes and other changes are as follows:

CHANGEWHAT, WHEN, & HOW
Increases In Statutory Redundancy Pay/Unfair Dismissal Basic AwardThe cap on average weekly pay increases to £489.00 on the 6th April 2017. Hence, statutory redundancy pay/the basic award in unfair dismissal cases will increase, and the maximum is now £14,670.00 (i.e. 20 x £489.00 x 1.5)
Immigration Rules ChangesRules for employing foreign workers change. Immigration skills charge of £1,000.00 per worker for employers sponsoring foreign workers with a tier 2 visa (small employers and charities will only have to pay £364.00 per worker). The tier 2 visa ‘experienced workers’ minimum salary threshold increases to £30,000. New entrants/some health and education staff exempted from salary threshold until 2019
Changes To The National Minimum Wage And The National Living WageNational Minimum Wage and National Living Wage alignment and increases take effect

The new rates for the national minimum wage and the national living wage are:-

- workers aged 25 and over: £7.50 per hour
- workers aged 21-24 inclusive: £7.05 per hour
- workers aged 18-20 inclusive: £5.60 per hour
- workers aged 16-17 years of age inclusive: £4.05 an hour
- The apprentice rate, for apprentices under 19 or 19 or over and in the first year of their apprenticeship:
£3.50 an hour
Salary-Sacrifice Arrangements: Tax Advanatges To be LimitedIncome Tax and employer NICs advantages of salary sacrifice schemes removed
Gender Pay Gap ReportingThe Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 come in to force from the 6th April 2017. Private sector and voluntary organisations who employ 250 or more people are required to report on gender pay gaps. They will have to provide details relating to the overall mean and median gender pay gap in each 12 month period up to the 30th April, beginning with the 12 month period up to the 30th April 2017 (to be published in April 2018). These requirements will be extended to the public sector at a later date
Apprenticeship LevyApprenticeship Levy comes into force from the 6th April 2017. Designed to fund 3 million new apprenticeships by 2020, the levy will be paid by businesses with pay bills of £3 million or more at a rate of 0.5%, which will be collected via PAYE
Increases In statutory maternity, paternity, adoption and shared parental payThe rate increases are as follows:-

- Statutory maternity pay: those who qualify are entitled to receive it for 39 weeks at a rate of 90% of their gross weekly pay per week, subject to a maximum of £140.98 per week (up from £139.58 per week) after the first 6 weeks (from 2nd April 2017)

- Statutory Paternity Pay: the smaller of £140.98 per week (up from £139.58 per week) or 90 per cent of their average weekly earnings per week (from 2nd April 2017)

- Statutory Shared Parental Pay: the smaller of £140.98 per week (up from £139.58 per week) or 90 per cent of their average weekly earnings per week (from 2nd April 2017)

- Statutory Adoption Pay: those who qualify are entitled to receive it for 39 weeks at a rate of 90% of their gross weekly pay per week, subject to a maximum of £140.98 per week (up from £139.58 per week) after the first 6 weeks (from 2nd April 2017).
Increase In Statutory Sick PayStatutory sick pay increases to £89.35 per week from the 6th April 2017
Public Sector intermediaries rules (IR35)Apply where the individual would be regarded as an employee in circumstances where the intermediary did not exist. From the 6th April 2017, deductions must be made by the intermediary from the individuals pay for tax and national insurance contributions
Introduction Of A Pensions Advice AllowanceFrom the 6th April 2017, a member can withdraw £500.00 tax free from their pension, for advice on the pension. This can be done 3 times in total, but only once in any one tax year. The policy applies to defined contribution pension schemes and hybrid pension arrangements

Please also check out our 2017 key dates article from earlier in the year, which sets out changes that are taking place in employment law throughout 2017.

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