Preparing for employment law changes

Looking ahead employment law is likely to change in several ways this year. Here is our guide to help steer you and your business through
those changes:

1. Increase to National Minimum and Living Wage

Both the National Living Wage (NLW) and National Minimum Wage (NMW) rates increase in April 2019. Under the NLW, the minimum hourly rate that workers aged 25 and over are entitled to will increase from £7.83 to £8.21.

The NMW rate for workers aged between 21-24 increases from £7.38 to £7.70 an hour; the rate for 18-20 year olds will increase from £5.90 to £6.15 an hour and those over compulsory school age, but not yet 18 will experience an hourly increase from £4.20 to £4.35.

The minimum rate for apprentices will also increase from £3.70 an hour to £3.90 an hour, providing the apprentice is under the age of 19, or 19 and over but in the first year of their
current apprenticeship.

2. Settled Status for EU nationals

European workers currently living in the UK will be able to apply for settled status in 2019, allowing them to remain indefinitely in the UK following the end of the Brexit transition period in 2021.

To be granted settled status individuals must be able to prove they have been living in the UK for five years by the date of application. Those who do not meet this requirement can apply for temporary status, allowing them to remain until they have accrued enough residency to be granted settled status.

3. Auto-enrolment for pension contributions

From April 2019 the minimum contributions for auto-enrolment pension schemes will increase for both employers and employees. Currently, automatic enrolment requirements mean employers must contribute a minimum of 2% of an eligible worker’s pre-tax salary to their pension pot, with the individual contributing 3% themselves. However, under the new requirements, employers and employees will
now have to contribute a minimum of 3% and 5% respectively.

4. Payslip changes

Changes to the way employers issue payslips come into force on 6th April 2019, as the legal right to a payslip will be extended to include those who are recognised as ‘workers’. Employers will also be obliged to include the total number of hours worked on payslips for employees whose wages vary depending on how much time they have worked.

5. National Minimum Wage for sleep-ins

Following the Court of Appeal decision on Mencap v Tomlinson Blake, a precedent was set that individuals working on sleep-in shifts, such as nurses and care workers, would not be entitled to the NMW for time spent asleep where they were ‘available for work’ and not ‘actually working’. A request to appeal this decision was lodged with the Supreme Court by Unison and a decision is expected this year as to whether this case will be analysed further. Any ruling will be important in defining the rights of thousands of staff currently working sleep-in shifts.

6. Gender Pay Gap Reporting

Private organisations with 250 or more employees will again be required to publish their gender pay gap figures on the 4th April 2019. Figures are expected to be scrutinised to determine whether efforts to address any significant pay disparity highlighted in 2018
have been successful.

7. CEO pay gap reporting

New legislation will also come into force this year that requires companies with more than 250 employees to publish their executive pay gap. Although the first reports are not expected until 2020, businesses should be calculating the necessary figures throughout 2019 to show the gap between the total amount paid to their CEO and the average pay for an employee.

8. Non-disclosure agreement

The Government have brought forward a review into the use of non-disclosure agreements in the workplace, with a response expected this year. These agreements were originally used to protect intellectual property when employees moved from one company to another. However, recent media coverage has highlighted the fact that they are often used to silence claims of harassment and bullying. Whilst these agreements remain legal, the Government’s response may go some way to deciding how they can be used in the future.

9. Supermarket Equal Pay claims

The decisions in separate tribunal cases on the issue of equal pay which involve Tesco, Asda, Morrisons and Sainsbury’s is expected this year. This will provide more clarity on the issue of equal pay and may pave the way for further claims from staff working in other sectors

10. Brexit

We can be certain that there will continue to be more uncertainty around this issue. We are therefore urging clients to get in touch, to find out how Brexit may affect the arrangements for their employees and workers.

Amanda Finn can be contacted at a.finn@gullands.com