Employment Law Changes 2017

Topics: employment law | WEU

Posted by admin on 28 December 2016

Eight Priorities for HR

By Qian Mou from Personnel Today

Significant employment law changes are anticipated for 2017, amid the ongoing uncertainty resulting from the Brexit referendum.

Large compliance projects for data protection and gender pay gap reporting will dominate the HR agenda in 2017. Employers are likely to see costs increase as the apprenticeship levy and additional fees for sponsoring foreign workers are introduced, and tax savings for employee benefits are significantly reduced.

Employers will also continue to deal with the implementation of restraints on public-sector exit payments and new trade union balloting rules in 2017.

More GDPR Resources

Podcast: Introduction to the General Data Protection Regulation

General Data Protection Regulation Compliance Efforts Underway

1. General Data Protection Regulation Compliance Efforts Underway

Although the EU General Data Protection Regulation (GDPR) does not come into force until May 2018, the scope of the changes under the new regulation means that preparing for GDPR will be a high priority for employers in 2017.

Employers will need to carry out audits of employee personal data that they collect and process to ensure it meets GDPR conditions for employee consent.

New governance and record-keeping requirements mean that employers will also have to create or amend policies and processes on privacy notices, data breach response and subject access requests.

As GDPR will come into effect before the UK exits the EU, organisations that are not compliant by May 2018 risk fines of up to €20 million or 4% of annual worldwide turnover, whichever is higher.

2. Gender Pay Gap Reporting Begins

Webinar: Preparing for Gender Pay Gap Reporting
How to Measure and Report a Gender Pay Gap

Private-sector, voluntary-sector and public-sector organisations with 250 employees or more will be required to publish gender pay gap information for the first time.

Employers must release information relating to employee pay and bonus pay, as well as details on the number of men and women in each quartile of the organisation’s pay distribution.

Gender pay gap regulations for private and voluntary sector employers are still in draft form, but the deadline for the first report is expected to be 4 April 2018, based on pay and bonus data from 2016/17.

Reporting requirements for public-sector employers are expected to mirror private-sector timelines and requirements.

3. Apprenticeship Levy on Large Employers Introduced

Employers with an annual payroll of more than £3 million will be required to pay a 0.5% levy on their total pay bill starting on 6 April 2017.

Large employers will be able to access levied amounts, plus a government top-up of 10%, to fund apprenticeships from accredited training providers.

Apprenticeship levy: 2016 survey – How do employers expect the apprenticeship levy to affect their use of apprentices?

Smaller organisations that are not required to pay the levy will also be able to receive funding for accredited apprenticeships by contributing 10% towards the cost, with the government covering the remaining cost.

4. Salary-Sacrifice Schemes Significantly Restricted

Employers may need to reconsider their benefit offerings as tax savings through many salary-sacrifice schemes will be abolished from 6 April 2017.

Schemes related to pension savings (including pensions advice), childcare, cycle-to-work and ultra-low emission cars will not be affected.

Schemes in place prior to April 2017 will be protected until April 2018, while arrangements related to cars, accommodation and school fees will be protected until April 2021.

5. Changes to Rules for Employing Foreign Workers

Employers sponsoring foreign workers with a Tier 2 visa will be required to pay an immigration skills charge of £1,000 per worker (£364 for small employers and charities) beginning in April 2017. The charge is in addition to current visa application fees.

In April 2017, the minimum salary threshold for “experienced workers” applying for a Tier 2 visa will also increase to £30,000. New market entrants and certain health and education staff will be exempt until 2019.

6. Restraints on Public-Sector Exit Payments Still Expected

Redundancy rights
Transfer of undertakings

Restrictions on public-sector exit payments, expected to come into force in 2016, are still anticipated although implementation dates remain unconfirmed.

Exit payments will be capped at £95,000 when public-sector employees leave their roles, including due to redundancy or voluntary exit.

Employees earning over £80,000 will also be required to repay exit payments if they return to a public-sector role within 12 months.

7. National Minimum Wage Changes Aligned

Cycles for national minimum wage increases — including the national living wage — will be aligned, with the next round of changes taking effect on 1 April 2017.

The next increase will see the national living wage for staff aged 25 or over rising to £7.50.

8. Trade Union Balloting Changes to Be Implemented

Employers await the implementation date for new balloting requirements under the Trade Union Act 2016.

Under the rules, a successful vote for strike action requires a minimum 50% turnout and a majority in favour. Industrial action in key public services will require a strike vote from at least 40% of all eligible voters.