This article looks at the increased pressures on so-called EJams
(employers just about managing) as a result of the changes being
introduced in 2017.
For employers, 2017 will see increased pressure on
so-called EJams (employers just about managing). In terms of
financial pressure, April will see the annual minimum wage
increase, introduction of the apprenticeship levy and the
immigration skills charge. The pressure builds further due to the
increase in pension auto enrolment, whilst the current
advantages of salary sacrifice are being scaled back. Employers
will also have to contend with increased scrutiny of the gender pay
gap and a continued focus on board diversity. Although
positive for employees, employers will need to accommodate the
increase in the National Living Wage from £7.20 to
£7.50 an hour and the National Minimum Wage from
£6.95 to £7.05 an hour.
The apprenticeship levy will mean that all UK employers with
annual wage bills of more than £3million will have to pay 0.5
per cent of their annual wage bill towards the cost of
After the implementation of the immigration skills charge,
employers with migrant workers under tier 2 of the points
based system of immigration will be subject to a levy of
£1,000 per certificate of sponsorship per year.
Salary sacrifice tax and NIC advantages will also reduce. The
only benefits that will continue to enjoy tax and NIC relief
through a salary sacrifice arrangement are enhanced employer
pensions contributions, child care benefits, equipment
provided under the cycle to work scheme and ultra-low
emission cars. Arrangements in place before April 2017
will be protected until April 2018, and arrangements for cars,
accommodation and school fees will be protected until April
Parents should note the changes to childcare vouchers,
which will be removed in their current form. From early this
year, there will be introduced a new tax-free childcare scheme
under which qualifying working families will be able to claim
20 per cent of qualifying childcare costs for children under
five (and disabled children under 17) up to a cap of
£2,000 per child per year. The scheme will be available
for families in which the total household income of the parents is
at least £50 per week, but there are exceptions, including a
parent being an additional rate taxpayer.
The implementation of the Trade Union Act is
expected this year and will bring increased ballot thresholds,
introduce new information and timing requirements in relation to
industrial action and impose legal requirements on
unions for the supervision of picketing.
The gender pay gap must be published by UK employers with at
least 250 employees within one year of 5 April 2017,
including mean and median overall pay and bonuses for each gender.
The information will comprise a snapshot of gender pay data in
April 2017 and annually thereafter in April, to be published on the
employer's and a Government website by 4 April 2018, and
Whilst the Scottish Parliament has already committed
to removing tribunal fees (at a date yet to be confirmed), in
England and Wales, in March, the Supreme Court will determine
Unison's judicial review challenge of the fees regime. The
removal of fees would mean more claims, therefore, increased
defence costs (and, where a claim succeeds, awards) for employers
We also await the outcome of a Government Inquiry focussed on
the rapidly changing nature of work, the status and rights of
agency workers, the self-employed and those working in the gig
economy. This could bring about changes to the definitions of
agency workers, casual workers and the self-employed and their
categorisation for the purposes of tax, benefits and
Of course, Brexit will remain on our radar given that much of
the UK's employment legislation is derived from EU law.
Theresa May has made clear, however, that for so long as she
remains Prime Minister, existing workers' rights will
continue to be guaranteed.
here to see the original article in The Scotsman.
In our article published in HR Zone, we consider the introduction of the new rules on regulatory references which come into force on 7 March 2017 and the practical steps that employers must take to comply...
Most of us know the difference between being employed and being self-employed (or at least we think we do). And in everyday laymen's terms, the difference is relatively straightforward and obvious – if you are employed, you work for someone else and, if you are self-employed, you ‘work for yourself'.
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