The Brexit referendum has created ongoing uncertainty and as a result there has been significant employment law changes anticipated for 2017.
In 2017 the HR agenda will be dominated by large compliance projects for data protection and gender pay gap reporting. It is likely that employers will see costs increase with the introduction of apprenticeship levy and additional fees for sponsoring foreign workers, as well as tax savings for employee benefits being significantly reduced.
- Apprenticeship levy on large employers introduced
All employers that have an annual payroll of more than £3 million will be required to pay a 0.5% levy on their total pay bill, this will start on 6 April 2017. To help fund apprenticeships form accredited training providers large employers will be able to access levied amounts, plus a government top-up of 10%.
- Gender pay gap reporting begins
Organisations with 250 employees or more in the private sector, voluntary sector and public sector will be required, for the first time, to publish gender pay gap information.
- National minimum wage changes aligned
Cycles for national minimum wage increases, including the national living wage, will be bought together with the next round of changes taking effect on 1 April 2017. The national living wage for staff ages 25 or over will be the next increase, rising to £7.50 per hour.
- Changes to rules for employing foreign workers
From April 2017 employers sponsoring foreign workers with a tier 2 visa will be required to pay an immigration skills charge of £1,000 per worker, however, for small employers and charities the charge will be £364. The immigration skills charge will be in addition to current fees for visa applications. Also, for ‘experienced workers’ the minimum salary threshold applying for a tier 2 visa will also increase to £30,000. New entrants to the job market, as well as some health and education staff will be exempted from the salary threshold until 2019.
- Trade union balloting changes to be implemented
There will be new balloting requirements under the Trade Union Act 2016, yet employers are awaiting the implantation date for this. Under the rules, a successful vote for strike action will require a 50% minimum turnout and a majority vote in favour of industrial action. In important public services, industrial action will require a strike vote of 40% of all eligible voters.
- General Data Protection Regulation compliance efforts underway
May 2018 is when we will see the EU General Data Protection Regulations (GDPR) come into force, however, this will already be a high priority for employers in 2017 to prepare for the scope of changes that will be made under the new Regulation. Employers will need to carry out audits of employee personal data that they collect and process to make sure that it meets GDPR conditions for employee consent. Employers will also have to create or amend policies and process on privacy notices, subject access requests and data breach responses. These changes are unlikely to be abolished by Brexit as they constitute many human rights characteristics.
- Restraints on public-sector exit payments still expected
It is still anticipated that there will be restrictions on public-sector exit payments, although this was expected to come into force in 2016. Exit payments could be capped at £95,000 when public-sector employees leave their roles, including as a result of redundancy or voluntary exit. Also, employees that are earning over £80,000 will be required to repay exit payments if they return to any public-sector role within 12 months.
- Salary-sacrifice schemes significantly restricted
In April 2017 many salary-sacrifice schemes will be abolished, therefore employers may need to reconsider their benefit offerings. Schemes in place before April 2017 will be protected until April 2018 and arrangements related to cars, school fees and accommodation will be protected until April 2021. Schemes related to pension savings and pension advice, cycle-to-work, childcare and ultra-low emission cars are likely to remain unaffected.
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