Happy new year to all our readers.

There are a number of important changes taking place this year that you need to prepare for.

1 April - Increases to national living and minimum wage

The National Living Wage (payable to workers aged 25 and over) will increase from £8.21 to £8.72

The National Minimum Wage will increase as follows:

  • Workers aged 21 to 24 – from £7.70 to £8.20
  • Workers aged 18 to 20 – from £6.15 to £6.45
  • Workers aged over compulsory school age under 18  - from £4.35 to £4.55
  • Apprentices – from £3.90 to £4.15

4 April - Gender pay gap reports due

This is the date by which all applicable organisations must publish their gender pay gap data for the snapshot date of 5 April 2019.  

The report must be published on the government website and a searchable UK website that is accessible to employees and the public.

6 April - Changes to employment contracts/section 1 statements

All employees and workers who start work on or after this date must be given a written statement on or before starting work. This is a 'day one' right and applies to workers - not just employees.

In addition to the information employers already have to provide, the statements must also set out:

  • the days of the week the individual is required to work and whether the days or hours could change and, if so, how
  • any paid leave (other than sickness or holiday)
  • details of any probationary period including any conditions that apply
  • any training provided by the employer and any other training the employee/worker has to complete which the employer won't pay for.    

Existing employees already employed on 6 April can request a statement containing this additional information. Employers have a month to respond.

6 April - Changes to the reference period for calculating holiday pay

The reference period in the Working Time Regulations 1998 for calculating annual leave increases from from 12 to 52 weeks. This applies to all 5.6 weeks' of a worker's minimum holiday entitlement.

If the worker has been employed for less than 52 weeks, their holiday pay is based on the number of complete weeks they have worked.

This will only affect workers whose pay varies.

6 April - Changes to agency workers (Swedish derogation)

From this date, agency workers won't be able to opt out of the right to receive equal pay which become available after 12 weeks by entering into a contract of employment with the agency (known as a Swedish derogation agreement). Plus, those who already work under a Swedish derogation contract must, no later than 30 April 2020, be given a written statement informing them that they are entitled to the equal pay provisions contained in the Agency Worker Regulations 2010.

If you use agency workers, this may push up costs

6 April - More employers will have to inform and consult their staff

The Information and Consultation of Employees Regulations 2004 (sometimes referred to as the ICE Regulations), are amended to lower the percentage of employees required for a valid request to start negotiating an agreement on informing and consulting employees from 10% to 2% of the total number of employees (subject to a minimum of 15 employees).

6 April - Increase on employer NICs on termination payments over £30,000

The rules for income tax and employer national insurance contributions will be aligned so that employer contributions of 13.8% will become payable on termination payments above £30,000. Currently only income tax is payable on sums in excess of £30,000.

6 April - Changes to IR35

From this date, employers that engage ‘off-payroll’ workers will become responsible for determining their employment status and paying NICs for those who are deemed to be employees.

More information is available here.

April - Increases to the statutory rates for maternity, paternity, shared parental pay, adoption and sick pay 

Statutory rates usually increase from the first Sunday of April. However, the rates have not yet been announced.

April - Increases in statutory payments and tribunal awards

The maximum compensatory award for unfair dismissals taking effect from 6 April 2020 is expected to increase from its current rate of £86,444. However, the amount of increase has not yet been announced.

A week’s pay (used to calculate statutory redundancy payments and the basic award in unfair dismissal claims) is also expected to increase will also increase from its current rate of £525 (gross) but the amount of increase has not been announced yet.

Need more information?

We're running a series of free update seminars across our offices in January/February to get your business ready for the year ahead. 

To find out when your nearest seminar is taking place, please contact Faaria Hussain: Faaria.Hussain@irwinmitchell.com or Joanne Moseley: Joanne.moseley@irwinmitchell.com