Companies warned to prepare for key Employment Law changes in April

2017 is set to be a very significant year from an employment law perspective, with a number of key changes taking place in April. 

Hannah Ball, Employment Law expert with Howes Percival comments: "April is always an important month for changes in employment law, and the two key obligations for larger organisations this year are the introduction of the Apprenticeship Levy and Gender Pay Gap Reporting." 

Apprenticeship Levy

From 6 April 2017, all businesses with a wage bill of more than £3 million will be liable to pay the levy at a rate of 0.5% of payroll (subject to a £15,000 annual allowance). The Government will apply a top up of 10% to the levy funds for spending on apprenticeship training in England i.e. for every £1.00 the business pays, it will get £1.10.   

The funds will be accessible through the Digital Apprenticeship Service which has been set up by the Government so that businesses can choose which apprenticeships they want to run. However, funds will expire 24 months after they enter the account.

Gender Pay Gap Reporting

From 6 April 2017 (31 March for the public sector), Gender Pay Gap Reporting regulations come into force for employers with 250 or more employees. The report has to set out the following information:  

  • Difference in mean and median hourly pay between male and female employees;
  • Difference in mean and median bonus pay between male and female employees;
  • Proportion of male and female employees who received bonuses; and
  • Proportion of male and female employees in each of 4 pay quartiles.

Private sector employers must publish their report by 4 April 2018 (and every year thereafter) and public sector employers must publish their report by 30 March each year. The Report has to be published on the employer's website for 3 years and uploaded to a designated Government website.

Salary Sacrifice Schemes

From 6 April 2017, the Government will limit the tax and National Insurance advantages available to employees through a salary sacrifice arrangement to the following benefits: 

  • Contributions to a registered pension scheme;
  • Employer provided pension advice;
  • Childcare vouchers;
  • Cycle to work schemes; and
  • Ultra-low emission cars.

Existing arrangements in place before 6 April 2017 will continue until 6 April 2018, or until 6 April 2021 for cars, accommodation and school fees.

Posted by: Howes Percival

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