A round up of the year's statutory rates, providing quick and easy access to information on compensation limits, family friendly payments, statutory sick pay, national minimum wage, disclosure and barring fees and National Insurance contribution thresholds
This timetable outlines the major changes to employment legislation 2017-2018, and what's expected in 2019 and beyond. For information on employment law in Northern Ireland, CIPD members can see our factsheet.
Employment legislation in 2017
1 March 2017
Trade Union Act: important public services
The Trade Union Act 2016, in force from 1 March, sets additional strike balloting requirements for those working in ‘important public services’. For strikes in those services to be lawful, not only must 50% of those eligible to vote participate in the ballot, but 40% must support the action proposed (as opposed to a simple majority of those voting, as required in strike ballots elsewhere).
Five sets of regulations specify the categories of public service workers covered by the additional 40% threshold. They are:
- Hospital services such as A&E, intensive care, psychiatric and emergency midwifery services
- Teachers of compulsory school age children, and those working in further education
- Fire-fighters, and fire and rescue service personnel organising emergency responses
- London bus, national rail, and tramway personnel, including maintenance workers, and air traffic control, airport and port security services
- Border control, sea patrol and border intelligence personnel.
Regulations on nuclear decommissioning services are to be produced at a later date.
31 March 2017
Gender pay gap reporting (public sector)
‘Specified public authorities’ – including government departments, the armed forces, local authorities, the NHS and state schools – that have 250 or more employees will have to report on their gender pay gap within one year of a ‘data snapshot’ date of 31 March each year. This means their first reports must be published by 30 March 2018.
The new rules, which largely mirror those for private and voluntary sector organisations (see below), are contained in the Equality Act 2010 (Specific Duties and Public Authorities) Regulations 2017.
1 April 2017
National Minimum Wage and National Living Wage
The following NLW and NMW hourly rates apply from 1 April 2017:
- Workers aged over 25 years (NLW): £7.50.
- Workers aged 21 to 24 years: £7.05.
- Workers aged 18 to 20 years: £5.60.
- Workers aged 16 to 17 years: £4.05.
- Apprentices (under 19 years, or in the first year): £3.50.
From 2017, changes to both the NLW and NMW rates will take place in April.
‘Prescribed persons’, the official organisations to whom whistleblowers can disclose wrong-doing under the whistleblowing protection legislation, will be required from this date to make annual reports of those disclosures. The first reports are due on 1 October 2018.
For more on this subject, see the Whistleblowing factsheet.
2 April 2017
Family friendly payments
Statutory maternity (SMP), paternity (SPP), adoption (SAP) and shared parental pay (ShPP) rises to £140.98 a week from 2 April 2017.
For more information, see Statutory rates and compensation limits.
6 April 2017
Gender pay gap reporting (private and voluntary sector)
All private and voluntary sector employers in England, Wales and Scotland with at least 250 employees are required to publish information annually about the differences in pay between men and women in their workforces under the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017, in force from 6 April 2017. The information must be based on a ‘snapshot’ of their pay bill on 5 April 2017, and annually thereafter, and the first reports must be published by 4 April 2018.
Similar reporting requirements apply to larger public sector employers (see above).
Regulations under the Northern Irish Employment Act 2016 are due by the end of June 2017, but there is no date yet for enforcement. Unlike the rules for England, this statute provides for fines of up to £5,000 for non-compliance, and includes a requirement for the pay band statistics to cover ethnicity and disability as well as gender.
See our Guide to gender pay gap reporting for more information.
An apprenticeship levy applies from 6 April to any public and private employers with an annual pay bill for the previous tax year in excess of £3 million. All employers in this category, whether or not they actually use apprentices, will have to contribute 0.5% if their annual pay bill, calculated on the basis of all payments to employees (including wages, bonuses and commission) that are subject to employer class 1 NICs. Levied employers with apprenticeships will receive an annual allowance of £15,000 to offset against their apprentice costs.
For more information see our factsheet.
Tribunal compensation limits increase from 6 April 2017. The new rates are:
- Limit on guaranteed payments – £27
- Limit on a week’s pay – £489
- Maximum basic award for unfair dismissal and statutory redundancy payment – £14,670
- Minimum basic award for unfair dismissal – £5,970
- Maximum compensatory award for unfair dismissal – £80,541
- Minimum compensation for exclusion/expulsion from a trade union – £9,118
For more information, see Statutory rates and compensation limits.
National Insurance thresholds
The lower earnings limit rises to £113 per week at the beginning of the new tax year, and the Class 1 upper earnings limit rises to £866 per week.
More details are available from GOV.UK
Statutory sick pay
Statutory sick pay (SSP) will increase to £89.35 on 6 April 2017.
For more information, see Statutory rates and compensation limits.
Immigration skills charge (Tier 2)
Organisations sponsoring non-EEA skilled workers under Tier 2 of the points-based system will pay a £1,000 immigration skills charge (£364 for smaller organisations and charities) per sponsored worker from 6 April 2017 (see draft regulations). The charge was recommended by the Migration Advisory Committee and confirmed by the Government in March last year. Workers in PhD-level occupations, those switching from Tier 4 student visas, and graduate trainees on Intra Company Transfer visas are exempt.
Also on this date:
- the minimum salary threshold for Tier 2 migrants rises from £25,000 to £30,000
- the immigration health surcharge will apply to Tier 2 Intra Company Transfers
- Tier 2 (General) workers in the education, health and social care sectors will need to provide a criminal record certificate for themselves and any adult dependants.
For more on immigration issues, see Employing overseas workers in the UK.
IR35 in the public sector
The IR35 tax rules governing off-payroll working in the public sector also change on this date. Responsibility for deciding whether the rules apply shifts from the worker to the public body, which will also be responsible for deducting relevant tax and NICs from the fee it pays to the intermediary organisation where appropriate.
For more information on IR35 changes in the public sector, see GOV.UK guidance.
Salary sacrifice schemes
From 6 April, only employer pension contributions, childcare benefits, cycle to work schemes and ultra-low emission company cars can be provided through salary sacrifice arrangements, although schemes in place prior to this date can continue to benefit from the tax advantages they provide until April 2018. Accommodation, school fees and other company cars may be provided under salary sacrifice arrangements until April 2021.
For more on salary sacrifice schemes, see Employee benefits.
11 July 2017
On this date Good Work: the Taylor review of modern working practices was published by the Department of Business, Energy and Industrial Strategy. The report followed more than six months of research into modern working practices carried out by a team led by Matthew Taylor.
The report makes a number of recommendations regarding the status of gig economy workers, including:
- Changing ‘worker’ status in employment law to ‘dependent contractor’ and making the distinction between such workers and the genuinely self-employed clearer
- Giving dependent contractors the right to a written statement of terms and conditions from day one (currently this only applies to employees)
- Making employers responsible for proving an individual is not entitled to employment rights in the event of a tribunal claim, rather than claimants.
The government has yet to respond to the report.
26 July 2017
Tribunal fees abolished
On 26 July 2017, the Supreme Court ruled that the regulations introducing tribunal fees in July 2013 were unlawful. Employment tribunals stopped accepting fees with immediate effect.
The government opened a fees refund scheme on 15 November 2017. Claims for refunds can be submitted by any employee and employer that paid Employment Tribunal or Employment Appeal Tribunal fees between 2013 and 2017.
For more details, CIPD members can see our Tribunal claims, settlement and compromise law Q&As.
15 November 2017
Tribunal fee refund scheme
The government has launched an online system for claimants seeking a refund for tribunal fees paid between 29 July 2013, when fees were introduced, and 26 July 2017, the date on which the regime was ruled unlawful by the Supreme Court. Refunds will include 0.5 per cent interest.
Respondents to a claim (usually employers) can fill in and post, or email, a downloadable refund form if they were ordered to pay the fees of a tribunal claimant during the fees period. More information is available on the GOV.UK website’s tribunals page.
The Ministry of Justice reported in December’s tribunal statistics that employment tribunal claims had risen by 66 per cent between July to October 2017, the first quarter since fees were abolished. Claims rose from 4,241 claims between April and June, to 7,042.
20 November 2017
Committees’ draft bill on worker status
The House of Commons Work and Pensions and Business, Energy and Industrial Strategy Committees published a joint report and draft bill on this date with the intention of closing the “loopholes that allow companies to use bogus ‘self-employment’ status as a route to cheap labour and tax avoidance” and taking forward the “best of the Taylor recommendations”. The report, A framework for modern employment, suggests:
- ‘worker’ status as the default position for gig economy companies labelling their workforce as ‘self-employed’
- a wage premium above national minimum wage rates for non-guaranteed hours
- fines for companies repeatedly losing tribunal claims over the same issues.
19 December 2017
Enforcing gender pay gap reporting
The Equality and Human Rights Commission (EHRC) published a draft policy and consultation on plans to force employers to publish their gender pay gap figures, if the current voluntary approach proves unsuccessful. Unlimited fines and enforcement through the courts are among a range of options being proposed for non-compliant organisations.
The consultation closes on 2 February 2018.
2 Feb 2018 - Gender pay gap reporting consultation
An Equality and Human Rights Commission (EHRC) consultation on measures to enforce the reporting of organisations’ gender pay gaps closed on this date.
The EHRC’s draft policy document on enforcement says that non-compliance with the regulations will initially be dealt with informally. Employers will need to report their gender pay gap within 42 days of receiving a letter from the EHRC. If this does not happen, the EHRC will investigate whether this amounts to an “unlawful act”, and the employer will be offered the option of a written agreement on compliance. If this option fails, organisations must prepare an action plan for remedying the breach and, if they do not do so, the EHRC could apply to the courts for enforcement. Failure to comply with the court order could be subject to an unlimited fine.
The regulations contain no enforcement penalties; the current proposals are based on the supposition that failing to comply with them is a breach of the Equality Act 2010, and some legal commentators maintain that gender pay reporting is beyond the Act’s scope. However, law firms have warned that the risk of reputational damage to organisations that do not comply is a greater threat than enforcement action.
7 Feb 2018 – Government response to the Taylor report
Matthew Taylor’s report for Government Good Work: the Taylor review of modern working practices, was published on 11 July 2017. The Government’s response to the report, accepting all but one of Taylor’s recommendations, was published in February 2018. It was accompanied by four Government consultations on how best to bring about the suggested reforms, divided into four separate categories:
- Employment status
- Increasing transparency in the labour market
- Agency workers
- Enforcement of employment rights.
See below for more details on each consultation.
30 Mar 2018 - Gender pay gap reporting: first reports (public sector)
‘Specified public authorities’, including government departments, the armed forces, local authorities, the NHS and state schools, with 250 or more employees, were required to publish their first gender pay gap reports by this date, based on data gathered on 31 March 2017.
The same ‘data snapshot’ and reporting dates apply from now on under the Equality Act 2010 (Specific Duties and Public Authorities) Regulations 2017, which are largely the same as those that apply to private and voluntary sector organisations of the same size (see below).
31 Mar 2018 - 'Fit for work' assessment ends
The government announced the scrapping of the ‘Fit for work’ assessment scheme in December 2017.
Launched three years previously, the scheme consisted of a free information service - providing advice on health, work, and managing sickness absence - and a free occupational health assessment service for employees who had reached, or were likely to reach, four weeks of sickness absence. Most referrals were expected to be made by GPs, but employers were also able to refer employees off sick for more than four weeks.
Employers, employees and GPs can still use the ‘Fit for work’ helpline, website and web chat service, but the assessment service closed in England and Wales on 31 March 2018, and in Scotland on 31 May 2018.
The closure, announced alongside a 10-year strategy paper for getting more disabled people into work called Improving lives: the future of work, health and disability, is attributed to a low referral rate.
1 Apr 2018 - National Minimum Wage and National Living Wage
From 1 April 2018:
Workers aged 25 and over: £7.83 an hour (National Living Wage)
Workers aged 21-25: £7.38 an hour
Development rate for workers aged 18-20: £5.90 an hour
Young workers rate for workers aged 16-17: £4.20 an hour
Apprentice rate: £3.70 an hour
For more information, see the Government’s response to the Low Pay Commission’s Autumn 2017 report.
4 Apr 2018 – Gender pay gap reporting: first reports (private and voluntary sector)
Private and voluntary sector employers in England, Wales and Scotland with at least 250 employees are required to publish information about the differences in pay between men and women in their workforce, based on a pay bill ‘snapshot’ date of 5 April 2017, under the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017. The first reports should have been published by 4 April 2018.
Similar reporting requirements apply to larger public sector employers (see above) although the compliance dates are different.
For more information see our Guide to gender pay gap reporting.
Provisions under the Northern Irish Employment Act 2016 mirror these, except they also include fines of up to £5,000 for non-compliance, and a requirement to report on ethnicity and disability pay gaps, as well as gender.
The Equality and Human Rights Commission launched a consultation which closed on 2 February 2018, on proposals to enforce the reporting requirements (see above).
6 Apr 2018 - Compensation limits
Tribunal compensation limits increased from 6 April 2018. The new rates are:
- Limit on guaranteed payments – £28
- Limit on a week’s pay – £508
- Maximum basic award for unfair dismissal and statutory redundancy payment – £15,240
- Minimum basic award for unfair dismissal – £6,203
- Maximum compensatory award for unfair dismissal – £83,682
For more information and levels of other rates, see Statutory rates and compensation limits.
6 Apr 2018 - Family friendly payments and Statutory Sick Pay
Statutory maternity (SMP), paternity (SPP), adoption (SAP) and shared parental pay (ShPP) rose from £140.98 to £145.18 a week from 6 April.
Statutory sick pay (SSP) rose from £89.35 to £92.05.
The lower earnings limit rose from £113 to £116.
For more information, see Benefits and pension rates 2018 to 2019 on the GOV.UK website.
6 Apr 2018 – Taxation of PILONs and termination payments
The government has introduced this new measure to 'clarify and tighten' the tax treatment of termination payments. By introducing these changes, the government aims to:
Treat all payments in lieu of notice (PILONs) as earnings (subject to tax and class 1 NICs). Effectively, employers will be required to subject to tax an amount equivalent to the employee's basic pay if notice is not worked. This change took effect from 6 April 2018.
Subject all termination payments above the £30,000 threshold to class 1A NICs (employer liability only). Subjecting termination payments above the £30,000 to class 1A NICs will be implemented in a National Insurance Contributions Bill to be published in 2018. The change will take effect from 6 April 2019.
Permit HM Treasury to vary the £30,000 threshold by regulations.
For more information, see Income tax and NICs: treatment of termination payments on the HMRC website.
23 Apr 2018 - EU whistleblowing directive
The European Commission has proposed a new directive on protecting whistleblowers from dismissal, demotion and other forms of retaliation, while providing them with safe channels for reporting within organisations and to public authorities. The proposals set out minimum standards of protection in specific EU policy areas, such as financial services, product safety, privacy and data protection, and would extend to ‘gig economy’ workers and the self-employed, as well as employees.
Although the new legislation, if adopted by the EU, would only come into force after March 2019, the standards may underpin any post-Brexit EU-UK trade deals.
Apr 2018 – Restricting employment allowance for illegal working
The government has introduced a further deterrent to employing workers without the right to work in the UK.
From April 2018, employers that have received a Home Office fine for hiring workers illegally, and exhausted the process for appealing against the penalty, will be unable to claim Employment Allowance (which reduces their NI contributions) for one year afterwards.
The details are contained in an HMRC consultation document.
9 May 2018 - Agency workers consultation closes
The Taylor review suggested improving pay information for agency workers, and giving them the right to request a direct contract of employment when placed with the same hirer for 12 months.
The Government is considering a number of these changes, including requiring agencies to inform workers who they are actually employed by, who is responsible for paying them and how much they will be paid. The consultation also looks at improving the monitoring of umbrella companies and other intermediary companies in the supply of agency workers. Also under consideration is the ‘Swedish Derogation’, which allows UK agency workers to opt out of entitlements to equal pay with permanent staff.
The consultation closed on 9 May 2018.
16 May 2018 - Enforcing employment rights consultation closes
The Taylor review recommended making Statutory Sick Pay (SSP), like the National Minimum Wage, a day one right, with the pay level linked to length of service. The consultation considers whether HMRC should take over responsibility for enforcing SSP for the lowest paid workers.
The consultation also looks at a ‘name and shame’ scheme for employers that fail to pay employment tribunal compensation, and increasing the penalties for employers that commit an aggravated breach of employment law from £5,000 to £20,000 per worker.
The consultation closed 16 May 2018.
23 May 2018 - Transparency in the labour market consultation closes
The Government has accepted the need for greater clarity over employment rights recommended by the Taylor report and this consultation looks at whether employers should provide enhanced written statements of employment particulars to all workers, not just employees. The consultation also considers include changing the rules on breaks in continuous service to make it easier for casual workers to claim redundancy payments or unfair dismissal compensation.
This consultation also looks at extending the holiday pay reference period for zero hours workers from 12 to 52 weeks, and at other ways that workers without fixed hours might receive holiday pay more flexibly.
The consultation closed on 23 May 2018.
25 May 2018 – General Data Protection Regulation and Data Protection Act 2018
The General Data Protection Regulation (GDPR) applies to all EU Member States, including the UK, from 25 May 2018.
The GDPR strengthens existing data protection rules through a number of measures, including:
- an expansion of individual data protection rights, including the right to be forgotten
- toughening the rules on individual consent to processing sensitive data
- shortening the time scale for responding to ‘subject access requests’ from 40 days to one month, and removing the £10 fee
- requiring organisations to report any data breaches which ‘risk the rights and freedoms of the individual’ to the regulatory authority and, where there’s a high risk of this, to the individual affected as well.
Breaches of the GDPR may lead to fines of up to 20 million Euros or 4 per cent of global turnover, whichever is the greater. Enforcement of the new rules in the UK rests with the Information Commissioner’s Office (ICO).
On 13 September 2017, the government introduced a new Data Protection Bill to:
- set new standards for protecting general data in accordance with the GDPR, while retaining certain UK exemptions
- replace the UK’s existing Data Protection Act 1998
- implement the EU’s law enforcement directive (concerned with the prevention, detection and prosecution of criminal offences).
The Bill received Royal Assent on 23 May to become the Data Protection Act 2018 which became law on 25 May.
The ICO has a range of information and resources especially designed for organisations. CIPD members can also see our Data protection, surveillance and privacy at work law Q&As.
1 Jun 2018 – Employment status consultation closes
The Taylor report suggested renaming those eligible for worker (rather than employee) rights as ‘dependent contractors’ and providing this category of worker with additional employment protections, including the right to a written statement of particulars, minimum pay rights, and the right to rolled-up holiday pay. The report also recommended enhancing self-employed rights to include pension provision and parental leave.
The Government has agreed there should be greater clarity over employment status, and this consultation seeks views on a range of options including new legislation to incorporate existing case law guidance on the gig economy, and aligning the tests for employment status and tax purposes.
The consultation closed on 1 June 2018.
17 Jul 2018 – Executive pay gap reporting regulations
New regulations under the Companies Act 2006, made on 17 July 2018, require UK listed companies with more than 250 UK employees to report annually on the pay gap between their chief executive and their average UK worker, from 2020 onwards.
Around 900 businesses will have to state, in their directors’ remuneration report, the pay gap between their CEO and a representative employee from the:
- 25th pay percentile
- median pay band
- 75th pay percentile.
Companies can choose between three options for calculating the pay gap, but must account for their choice in the report. They must also say, in their annual reports, what action they’ve taken to improve employee engagement and consultation.
The new regulations come in to force on 1 January 2019.
23 Jul 2018 - Caste discrimination legislation dropped
In a response to a consultation that took place in 2017, the government has decided not to go ahead with an option to add caste to the definition of race as a ‘protected characteristic’ under the Equality Act 2010. A provision allowing for the amendment, inserted into the Act in 2013, will be repealed.
The government has instead decided to rely on case law to reinforce its position that caste discrimination is unacceptable, following an Employment Appeal Tribunal decision in the case Tirkey v Chandhok (2015). The EAT decided that the Act’s definition of race discrimination already covers caste where this relates to ethnic origin. The case is binding on tribunals, and the government has said it will support a case on caste in a higher court, if appropriate.
(Members can read more on the Tirkey case by going to our Case law on race discrimination page.)
30 Jul 2018 – Enquiry into sex discrimination
The House of Commons Women and Equalities Committee is collecting evidence on how well the Equality Act 2010 is working.
The committee has already made a number of recommendations, following enquiries into pregnancy and maternity, transgender and older worker discrimination, workplace sexual harassment, and other issues covered by the Act. These include:
- extending time limits for pregnancy/maternity and sexual harassment claims
- increasing the use of the EHRC’s enforcement powers
- increasing regulators’ involvement in tackling discrimination in regulated organisations.
The deadline for submissions to the current enquiry is 5 October 2018.
2 Aug 2018 – Extending gender pay gap reporting to SMEs
The House of Commons Business, Energy and Industrial Strategy select committee has recommended that gender pay gap reporting should be extended to companies with 50 or more employees from 2020.
Its report, published on 2 August, also recommends:
- making narrative reporting and action plans mandatory rather than optional extras
- including partner salaries in the pay gap calculation
- revising government guidance on current ambiguities (such as how bonuses should be calculated)
- providing specific fines as part of the Equalities and Human Rights Commission enforcement powers.
10 Aug 2018 – IR35 private sector consultation closes
The IR35 rules, introduced in 2000, are aimed at reducing tax avoidance for people working off-payroll through personal service companies (PSCs). HMRC estimates that only 10 per cent of the PSCs that should be applying the rules actually do so. To address this, the government switched responsibility for deciding whether IR35 applied from contractors to end-users in April 2017, but only for PSCs operating in the public sector.
Chancellor Philip Hammond confirmed in the Spring Statement 2018 that the government was considering extending the rule change to the private sector.
On 18 May an HMRC consultation opened, proposing to make private sector employers responsible for accounting for tax and employer NI contributions for workers engaged through intermediaries. The consultation closed on 10 August.
23 Aug 2018 - Workplace rights in a ‘no-deal’ Brexit
Government guidance, published on this date, confirms there will be no overall changes to workplace rights in the event of a ‘no deal’ Brexit.
The technical notices specify that rights derived from EU law – such as annual paid leave and other working time rights, family friendly rights, protection from discrimination, harassment and victimisation, and from less favourable treatment for agency, part-time and fixed-term workers – will continue to apply after 29 March 2019.
There are only two areas of change specified: employees working for a UK employer outside of the UK may not be protected in the event of their employer becoming insolvent, and no new requests may be made to set up a European Works Council in the UK after that date.
For more on the implications of Brexit for employers, visit our Brexit hub.
13 Sep 2018 – Extension to gender pay gap reporting postponed
The government confirmed on this date that it had no immediate plans to extend the gender pay gap reporting regulations, but would review and evaluate their effectiveness in five years’ time.
The government was responding to a report from the Commons Treasury select committee which recommended extending the regulations to include equity partners, and company subsidiaries with fewer than 250 employees.
Earlier in the summer (2 August 2018), a Business, Energy and Industrial Strategy committee report proposed, among other suggested reforms, extending the regulations to organisations with 50 employees or more from 2020, making it compulsory to publish a narrative and action plan alongside the figures, and giving the Equality and Human Rights Commission specific powers to fine organisations for non-compliance.
The Government Equalities Office, which collects the pay gap data, has published a ‘What works’ guide to closing pay disparities.
26 Sep 2018 – Consultation on employment tribunals
The Law Commission, a statutory body which is independent of government, issued a consultation on this date, highlighting some aspects of the employment tribunal system that may be in need of reform.
The consultation asks a number of questions, including:
- whether the time limits for bringing a claim (generally three months) should be extended, and a legal test introduced for tribunals to use when deciding if an extension is justified
- whether tribunals should be able to hear breach of contract claims before employment has ended, and whether the current £25,000 cap on awards should be increased
- whether respondents to a discrimination claim should be able share liability with, or be entitled to a contribution from, a co-respondent in the case (including, potentially, any employee for whose actions the respondent is vicariously liable).
The consultation closes on 11 January 2019.
4 Oct 2018 – Abolition of childcare vouchers
The workplace childcare voucher system, and the directly contracted childcare scheme (childcare provided by the employer), are closed to new entrants from 4 October 2018. The schemes’ closure, due on 5 April 2018, was delayed by six months, following a vote in Parliament.
The abolition is among changes made as part of the rollout of universal credit. The employer-backed vouchers are to be replaced by a new system of tax-free childcare, entitling families to claim up to £2,000 per child.
11 Oct 2018 – Consultation on ethnicity pay gap reporting
The government has launched a consultation on introducing pay gap reporting based on ethnicity, as a result of its Race Disparity Audit conducted during 2017. The audit found significant disparities in the pay and progression of employees from black and ethnic minority (BAME) backgrounds compared to their white colleagues.
The consultation proposes a number of different approaches to calculating the pay gap, and asks whether organisations should be required to publish narrative information alongside the figures, or whether this should remain voluntary, as in gender pay gap reporting. The suggested reporting threshold - 250 employees – mirrors these regulations.
The consultation closes on 11 January 2019. Its publication coincides with the launch of a ‘Race at Work Charter’, committing organisations that sign up to a set of principles and actions on encouraging the recruitment and progression of BAME employees. Read our comment.
26 Oct 2018 – Bill on definition of 'worker’
Scottish MP Chris Stephens has introduced a Workers (Definition and Rights) Bill under the Parliamentary private members’ 10-minute rule in 2017. The Bill would ban zero hours contracts, except where their use was agreed with the individual’s trade union, and clarify the definition of ‘worker’ in the light of recent case law from the Supreme Court. The bill is due to pass to the second stage in the Parliamentary procedure in October 2018.
Private Members’ Bills usually need the backing of the government to become law.
13 Nov 2018 – Non-disclosure agreements enquiry
The Parliamentary Women and Equalities Committee has launched an enquiry into the use of non-disclosure agreements (NDAs) in cases involving any form of harassment or other discrimination, including pregnancy or maternity discrimination, or racist abuse. The committee has already recommended a review of how NDAs are being used in sexual harassment cases.
Written evidence is requested on a number of issues, including whether NDAs (sometimes referred to as ‘gagging clauses’) should be banned, or safeguards introduced to prevent misuse, and whether organisations should be required to disclose the number and types of NDAs they enter into.
The enquiry closes on 28 November 2018.
17 Dec 2018 – ‘Good work plan’ on employment rights
The government published a policy paper on this date, re-confirming its commitment to strengthening existing employment rights, following the Taylor review into ‘Good work’ in July 2017.
Among the planned or proposed reforms in the Good work plan are measures to:
- give zero hours workers the right to request a more stable contract
- give all workers a day one right to a statement of their terms and conditions
- produce new legislation on defining employment status
- lengthen the reference period for calculating holiday pay from 12 weeks to 52 weeks
- abolish the Swedish derogation on paying agency workers between assignments
- allow casual workers a four-week gap between assignments without losing continuity of employment (currently broken after one week).
The policy paper does not contain draft legislation, or a timetable for the reforms, but new regulations have been produced for those changes which the government committed to earlier in the year (see entries for 2019 and 2020).
Read our response to the reforms.
18 Dec 2018 – Code of practice on sexual harassment
The government stated on this date its intention to introduce a new statutory code of practice on dealing with workplace sexual harassment, which would include what actions employers need to take to prevent it and how staff can report it.
The code, which will be developed by the Equality and Human Rights Commission, was among a package of 12 measures designed to tackle sexual harassment at work. They included consultations on:
- strengthening the law with regard to non-disclosure agreements
- introducing a new legal duty for employers to prevent sexual harassment (including from third parties)
- protecting interns and volunteers from all forms of discrimination
- extending the three-month time limit for bringing a discrimination claim.
19 Dec 2018 – Immigration white paper
The government published its long awaited white paper on immigration arrangements that will apply when free movement of EU workers ends following Brexit.
The proposals for a new skills-based immigration system, that will apply both to EU migrants and those from elsewhere, follow the recommendations of the Migration Advisory Committee and include:
- removing the annual cap on the number of work visas that can be issued
- widening the skills threshold to include migrants with A-level equivalent qualifications
- ending the labour market test for employers wishing to sponsor a worker.
The government is to consult on what would be an appropriate salary threshold (currently £30,000 a year) for the skilled migrant route. There is also to be a new 12-month temporary work visa for workers of any skill level.
2019 and beyond
1 Jan 2019 – Executive pay gap reporting in force
From this date, regulations made under the Companies Act 2006 require UK listed companies with more than 250 UK employees to report annually on the pay gap between their chief executive and their average UK worker.
The first reports are due in 2020.
See 17 July 2018 - Executive pay gap reporting regulations for more details.
29 Mar 2019 - Brexit
The UK gave notice of its intention to quit the EU on 29 March 2017. There is a two-year timeframe for negotiating the terms of a member state’s departure under the Lisbon Treaty, making 29 March 2019 the UK’s leaving date, although this period can be extended by agreement.
Both sides agreed in March 2018 to a transitional phrase, lasting from 29 March 2019 until 31 December 2020, during which:
- free movement of EU citizens will continue
- the UK will stay bound by EU trade arrangements while negotiating its own international trade deals.
The need to avoid a hard border between Northern Ireland and the Republic of Ireland as a result of Brexit is proving a major problem in the negotiations.
For more information and resources on Brexit and employment, visit our Brexit hub.
30 Mar 2019 – Gender pay gap reports (public sector)
‘Specified public authorities’, including government departments, the armed forces, local authorities, the NHS and state schools, with 250 or more employees, are required to publish their gender pay gap reports by this date, based on data gathered on 31 March each year.
The requirements for the reports, under the Equality Act 2010 (Specific Duties and Public Authorities) Regulations 2017, are largely the same as those that apply to private and voluntary sector organisations of the same size (see below).
1 Apr 2019 – National Minimum Wage and National Living Wage
Chancellor Philip Hammond announced in the Budget 2018 new National Minimum/Living Wage from 1 April 2019 as:
- Workers aged 25 and over - £8.21 an hour (National Living Wage)
- Workers aged 21-24 - £7.70 an hour
- Development rate for workers aged 18-20 - £6.15 an hour
- Young workers rate for workers aged 16-17 - £4.35 an hour
- Apprentice rate (workers under 19 or in first year of apprenticeship) - £3.90 an hour.
More information is available on the GOV.UK website.
1 Apr 2019 – Government Equalities Office move
Minister for Women Penny Mordaunt announced on 16 November 2018 that the Government Equalities Office would move to the Cabinet Office on 1 April 2019. The move is intended to give the Office “more influence and leverage within government, working with the Race Disparity Unit, and the Office of Disability Issues, to drive meaningful progress on equalities,” Mordaunt said in a ministerial statement.
The minister has also announced a change in focus for the government’s gender equality strategy, away from women on boards in larger organisations, towards lower paid and part-time women in smaller businesses.
4 Apr 2019 – Gender pay gap reports (private and voluntary sectors)
Private and voluntary sector employers in England, Wales and Scotland with at least 250 employees are required to publish information about the differences in pay and bonuses between men and women in their workforce, based on a ‘snapshot’ date of 5 April each year, under the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017. The first set of reports was published in 2018, and the second reports are due by 4 April 2019.
Similar reporting requirements apply to larger public sector employers (see above).
Provisions under the Northern Irish Employment Act 2016 mirror these, except they include fines of up to £5,000 for non-compliance, and a requirement to report on ethnicity and disability pay gaps, as well as gender.
For more information on gender pay gap reporting, see our topic page.
6 Apr 2019 – Good work plan: employer penalties for breaches
The government’s ‘Good work plan’, published in December 2018, made a commitment to increase the penalties for employers that repeatedly breach their employment law obligations. Tribunals have the power to impose a £5,000 ‘aggravated breach’ penalty on employers losing cases, and from 6 April 2019, the maximum limit on these penalties will rise to £20,000.
The change is contained in Part 1 of the Employment Rights (Miscellaneous Amendments) Regulations 2019.
6 Apr 2019 - Pay slip changes
Two important changes to the Employment Rights Act 1996, affecting pay slip information, will come into force on 6 April:
- Employers must include the total number of hours worked where the pay varies according the hours worked, for example under variable hours or zero hours contracts.
- Payslips must be given to ‘workers’ and not just employees.
For more information, CIPD members can also see our Terms and conditions of employment law Q&As.
Apr 2019 - Tax on termination payments
The government’s plans to make any part of a termination payment over the sum of £30,000 subject to employer NICs is due to become law on this date. This change was delayed from April 2018 (see 'Apr 2018 - Taxation of PILONs and termination payments' above).
6 Apr 2020 – Good work plan: agency workers
In the ‘Good work plan’, published in December 2018, the government made a commitment to abolish what had become known as the ‘Swedish derogation’ in the rules governing the use of agency workers. This allowed businesses to opt out of equal pay requirements that govern pay-between-assignment arrangements for their permanent staff when using agency workers instead.
The opt-out will cease on 6 April 2020 when the Agency Workers (Amendment) Regulations 2019 come into force.
6 Apr 2020 – Good work plan: annual leave
The ‘Good work plan’, published in December 2018, makes a commitment to improving the holiday pay arrangements for seasonal workers, who tend to lose out over the way it is currently calculated.
To correct this, the government is lengthening the reference period for determining an average week’s pay from 12 weeks to 52 weeks from 6 April 2020 - see the Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018.
6 Apr 2020 – Good work plan: statement of terms
Under the ‘Good work plan’, published in December 2018, the entitlement to a statement of ‘written particulars’ (the basic terms and conditions of an employment) is extended to include workers as well as employees (see Part 2 of Employment Rights (Miscellaneous Amendments) Regulations 2019). This will also become a day one right. Currently employers have up to two months to issue the statement to any employee working for them for more than a month.
April 2020 – extension of IR35 to private sector
Chancellor Philip Hammond announced in the Budget on 29 October 2018 that the IR35 tax rules would be extended to the private sector in April 2020. It had been expected that the change would come in to effect in April 2019, following a consultation earlier this year.
The rules are aimed at reducing tax avoidance for off-payroll contractors working through personal service companies (PSC). Since April 2017 (see above), public sector employers have been responsible for deciding whether IR35 applies, and for deducting tax and NICs from contractors’ fees paid through PSCs when it does not.
The extension will only apply to large and medium-sized organisations. A further consultation is expected in the summer of 2019.
2020 – Executive pay gap reports published
2020 - Parental bereavement provision
In October 2017, the government confirmed its backing for a private members’ bill, the Parental Bereavement (Leave and Pay) Bill. The Bill, which became the Parental Bereavement (Leave and Pay) Act on 13 September 2018, will entitle employees who lose a child under the age of 18, or suffer a stillbirth from the 24th week of pregnancy, to two weeks’ unpaid leave, as a right from day one of their employment.
The leave will be paid at the statutory rate (see our Statutory rates and compensation limits) if the employee has 26 weeks’ service. The government is aiming for the new law to be in force in 2020.
Employed parents are already entitled to take a reasonable amount of unpaid time off to deal with an emergency involving a dependant, including dealing with a dependant’s death, as a day one right.
Currently on hold – Grandparental leave
A landmark proposal by David Cameron’s 2015 government to introduce grandparental leave through an extension to shared parent leave (SPL) has been put on hold. The decision has been made whilst the present government carries out an evaluation of SPL, the findings of which are expected to be published early 2019.
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