The new year brings new employment law updates for 2020. We have summarised the changes to help you gain an understanding of what will come into force over the next 12 months.
As usual, April is set to be the busiest month. If you are unsure of what you need to do to remain compliant with the law, we are happy to help.
National Minimum Wage and Living Wage – 1 April 2020
The rates from 1 April 2020 are:
• £8.72 per hour – 25 yrs old and over (the living wage)
• £8.20 per hour – 21-24 yrs old
• £6.45 per hour – 18-20 yrs old
• £4.55 per hour – 16-17 yrs old
• £4.15 for apprentices under 19 or 19 or over who are in the first year of
Increase in Statutory Maternity, Paternity, Adoption and Shared Parental Leave Pay – 5 April 2020
Rate of Statutory Maternity, Paternity, Adoption and Shared Parental Leave will increase from £148.68 to £151.20 per week.
Increase in Statutory Sick Pay – 6 April 2020
Rate of statutory sick pay will increase from £94.25 to £95.85 per week.
Changes in tax for termination payments above £30,000 – 6 April 2020
Employers will be liable to pay Class 1A national insurance contributions on termination payments above £30,000 that are subject to income tax by the employee. The new measure will be introduced in the National Insurance Contributions Bill.
Right to receive a written statement of terms and conditions from Day One – 6 April 2020
A new law making a written statement of main terms and conditions a day-one right for workers and employees to be introduced.
Amendment to mandatory information in written statements – 6 April 2020
Amendments to mandatory information required within a written statement of main terms and conditions to be introduced. There are significant changes, if you contact us we can provide you with a list of the changes set out in the Employment Rights Act 1996. This will mean that many companies now need to update their main statement of terms and conditions document, more commonly referred to by Employers as the Contract of Employment.
Holiday Pay reference period change – 6 April 2020
New law extending the holiday pay reference period from 12 to 52 weeks to be introduced.
Abolition of the Swedish Derogation relating to pay for Agency Workers – 6 April 2020
The Agency Workers (Amendment) Regulations 2019 (SI 2019/724) abolish the Swedish derogation. So, what do you need to be aware of? This affects the contract for agency workers who currently have a Swedish Derogation in their contract. By no later than 30 April 2020, agencies must give these agency workers a written statement that this derogation no longer applies.
Parental Bereavement Leave Rights – April 2020
The Parental Bereavement (Leave and Pay) Bill provides at least two weeks leave for employees following the loss of a child under the age of 18. Employees with 26 weeks continuous service will be entitled to paid leave at the statutory rate and other employees will be entitled to unpaid leave.
IR35 Changes – 6th April 2021
IR35 was set to come into forace as of April 2020, this has however been pushed back unti April 2021.
IR35 is a set of complex rules that affect an individual’s tax and National Insurance Contributions (NICs) if he or she is contracted to work for an intermediary. Its stated aim is to prevent workers using limited companies, through which they effectively work as employees, without paying the relevant tax.
From April 2021, eligible large and medium-sized organisations engaging contractors through intermediary companies will be responsible for assessing the employment status of those contractors. Under the new rules, where workers are engaged through their own companies, the responsibility to apply IR35, and to pay any associated tax and National Insurance contributions, will fall to the private company, agency or other third party paying the worker’s company. See our IR35 blog on this subject for further details.
Employee Information and Consultation – 6 April 2020
A new Law lowering the threshold for employers required to set up Employee Information and Consultation arrangements from 10% of employees to 2%.
1 January 2021 – New Immigration Scheme
The new immigration scheme comes into force for all applicants regardless of their nationality.
We appreciate that this needs a full understanding of your business and how it will apply. We are here to help you identify and understand the impact on your business of these latest Employment Law updates. Please feel free to contact us for advice and support. You can also read our articles on How Brexit will Impact Health and Safety and how to Get HR Ready for Brexit. We can help you make sense of it all and take the appropriate actions to ensure you are compliant with the latest updates to the law. Request a conversation with Park City.