InsightsInsight - Employment & HR - POSTED: May 21 2021
Employment law update: April 2021
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Although the employment landscape has been dominated by Brexit and the coronavirus pandemic over the past couple years, changes to employment laws are still taking place.
Employers should be aware of these changes and take care not to overlook these.
In this article we review the latest employment law changes and issues that have recently come into effect and other key issues that employers should be aware of.
1 April 2021
National living and minimum wage
From 1 April 2021, the national living wage increased from £8.72 to £8.91 per hour. From April 2021 this rate applies to workers aged 23 and over.
The rates for workers aged 21-22 has increased to £8.36 per hour, and for 18-20 year olds is now £6.56 per hour.
The young workers rate (for those aged 16-17) has increased to £4.62 per hour and the apprentice rate increased by 15p per hour, to £4.30.
The record keeping period for national minimum wage purposes has also increased from three, to six years.
4 April 2021
From 4 April 2021, the prescribed rate for family related pay (statutory maternity, paternity, adoption, shared parental leave and maternity allowance) increased to £151.97 per week.
Statutory Sick Pay
The rate of Statutory Sick Pay (SSP) has increased to £96.35 per week.
6 April 2021
Increase to tribunal awards
For dismissals taking place since 6 April, the maximum compensatory award for unfair dismissal has increased to £89,493 (or 52 weeks’ pay, whichever is the lower).
The statutory limit on a gross weeks’ pay has also increased to £544. This means that the maximum statutory redundancy payment is now £16,320.
The bands of awards for injury to feelings in discrimination cases (known as the Vento bands) have also increased for claims presented on or after 6 April 2021.
The lower band for less serious cases is now £900 – £9,100, the middle band for cases that do not merit an award in the upper band is £9,100 – £27,400. The upper band for the most serious cases is £27,400 – £45,600. Only the most exceptional cases will be capable of exceeding £45,600.
Changes to the off-payroll working rules (or IR35) came into effect on 6 April 2021, having been postponed from April 2020. The changes apply to medium and large clients in the private sector who engage contractors via an intermediary, most commonly a personal service company. In brief, the impact of the changes means that the responsibility for determining whether the individual worker is an employee for tax purposes, has shifted from the intermediary to the engaging entity. If they determine that the individual would be an employee for tax purposes, they will be responsible for deducting income tax and national insurance contributions as the deemed employer.
The current employment law landscape
The Coronavirus Job Retention Scheme has been formally extended to 30 September 2021. After 30 June, employers will be required to contribute to wages for hours not worked at a rate of 10% from July 2021, and 20% for August and September, as well as employer national insurance and pension contributions.
Following new Public Health shielding guidance in place from 1 April, those classified as extremely clinically vulnerable are no longer advised to shield and are no longer eligible for SSP as a result of being advised to shield.
Brexit and immigration
Since 1 January 2021, a new, points-based immigration system has applied to non-EU and EU nationals who move to the UK to live and work.
All non-British and Irish nationals coming to the UK to work must qualify under one the of the categories specified in the UK immigration rules.
Applications under the EU Settlement Scheme are still open to EU citizens and their families who arrived in the UK before 11pm on 31 December 2020, although the scheme will close on 30 June 2021.
The two main work visa options are either the skilled worker, or intra-company route. Migrants without settled or pre-settled status must be sponsored by an employer before they can apply for permission to enter or remain in the UK.
Under the skilled worker route, job offers must meet a skills threshold and a minimum salary threshold, as well as minimum English language requirements.
The Presidents of the Employment Tribunals in England and Wales have recently released a roadmap, which sets out the arrangements for listing new cases over the next few years in the employment tribunals.
The roadmap confirms that the majority of cases will continue to be heard remotely as the default position, although this will vary from region to region and depending on the type of claim.
A new ‘virtual region’ will also be created in England and Wales to hear cases generated across all regions to deal with a backlog of cases.
Other measures being introduced by the tribunal are the appointment of 16 new legal officers, who are authorised to deal with matters falling within delegated powers, and the introduction of a new case management system to increase efficiency.
Acas early conciliation
There have been some changes to the Acas early conciliation process. From 1 December 2020, the standard early conciliation period has been extended from one month, to six weeks.
The rules have also been amended to allow Acas conciliators to contact claimants to correct any errors on the early conciliation form during the conciliation period.
Health and Safety Detriment extended to workers
S.44 (1) (d) and (e) Employment Rights Act 1996 will be extended to give workers protection against detrimental treatment on health and safety grounds.
Currently only employees have this protection. This will apply to detriments taking place on or after 31 May 2021.
Gender pay gap reporting
The gender pay gap reporting deadline for the 2020/2021 reporting period has been extended to 5 October 2021 for qualifying employers in the private sector.
Future expected developments
A government consultation on the future of restrictive covenants has recently ended. Possible reforms could include introducing mandatory compensation payable by the employer to the employee for the duration of the restricted period, or even the complete ban of non-compete clauses. The possibility of legislating non-compete clauses has also been raised.
We will have to wait and see what comes out of the consultation and review any developments. Financial compensation for the restraint period is common in many European countries, and may be the direction of travel in this area.
Pregnancy and Maternity Redundancy Protection Bill
The Bill is currently waiting for its second reading before the House of Commons. The Bill proposes the prohibition of redundancy during pregnancy and maternity leave and for the six months following the end of the pregnancy or maternity leave, except in specified circumstances.
Women who experience a miscarriage would be protected for six months after their pregnancy ends or six months after the end of any leave they were entitled to.
Please be aware that this is the top line information relating to the latest employment law developments. For more in-depth guidance or support around the issues covered in this article, book a free 30-minute consultation with our Employment team today.
You can also view a recording of our recent Brachers Bitesize webinar which focusses on the latest employment law updates covered in this article.
To check on the updates to employment law from last year, read our article employment law changes – preparing for April 2020.
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