Solicitors outline complex challenges for employers in the year ahead


Tuesday 21 February 2017



Businesses are facing a frontline challenge during the year ahead when it comes to changes in employment law – say legal experts from Buckles Solicitors LLP.

For employers, 2017 has started with a high-profile case where a courier has won her action to be treated as a worker, not a self-employed contractor.

And there are more changes on the way. Buckles partner and head of employment Giles Betts explains: “The Government is moving to crack down on unscrupulous employers to stamp out exploitation in the workplace, after several companies hit the headlines for poor practices in recent months, including reports that workers at Sports Direct were receiving less than the national minimum wage and being subjected to humiliating working practices.

“Together with other employment legislation already announced for introduction this year, bringing further significant changes and new requirements, businesses need to make sure they are up to date with their practices and terms of employment. Some of these changes are complex and may present some challenges for employers.”

Up and coming legislation includes:
The Equality Act 2010 (Gender Pay Gap Information) Regulations are set to come into force on 6 April 2017 meaning all private sector organisations with at least 250 employees must publish details of their gender pay gap, for both basic pay and any bonus payments. The first reporting will be due no later than 4 April 2018, and annually after that.

Apprentice levy: Also due on 6 April is the annual apprenticeship levy, under the Finance Act 2016 (part 6). The levy must be paid by all private and public sector employers in the UK with a pay bill of £3 million and above. The income will be used to fund a new system of post-16 apprenticeships, which will be available to those employers falling below the £3m threshold.

Salary sacrifice schemes: As announced in the Autumn Statement, the Finance Bill 2017 will set out changes to the tax status of salary sacrifice benefits with effect from April 2017. The changes will see an end to the tax saving benefits of most salary sacrifice schemes, which will become subject to the same taxation as cash income. Any arrangements in place before 6 April 2017 will be protected for one year, or four years in the case of cars, accommodation or school fees. The extension will apply until the arrangement ends, is renewed or otherwise modified. Remaining exempt from tax will be pensions and related advice, cycle-to-work and ultra-low emission cars.

Tax-free childcare: Also retaining its taxation benefits will be existing employer-supported childcare voucher schemes. These can remain open to new entrants until April 2018 with childcare vouchers and all associated tax savings available for the life of the scheme. However, the Government is expected to launch a new, alternative tax-free childcare scheme, which will allow working families satisfying a minimum/maximum income requirement to claim 20 per cent of childcare costs for children under 12, or under 17 where children have a disability, capped at £2,000 per year.

Holiday pay: An appeal by British Gas to the Supreme Court will challenge last year’s ruling by the Court of Appeal that holiday pay should be ‘normal pay’ and include contractual results-based commission. The appeal is expected to be heard in March 2017 but in the meantime the ruling stands and employers need to look at irregular payments made to employees and establish which are to be included within ‘normal’ pay and so be included in any calculation for holiday pay.




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