Every April we see a number of new employment laws released or changes published. Toni Trevett, Director of CompleteHR, outlines the key employment law changes for 2016 so far and examines their impact on businesses.
National Living Wage
The National Living Wage (NLW) will be implemented through the National Minimum Wage Regulations. The first NLW is to be set at £7.20 and will apply to workers aged 25 and over from April 2016.
This is not to be confused with the Living Wage. Whereas the NLW is a statutory entitlement, its rate effectively set by the Government, the voluntary Living Wage is maintained by campaign group the Living Wage Foundation. The Living Wage rate is currently £7.85 per hour and £9.15 in London. More than 1,500 employers voluntarily choose to pay the Living Wage.
The government has also confirmed the increases to the national minimum wage rates in October 2016: the rate for workers aged 21 to 24 is to increase from £6.70 to £6.95 an hour. The rate for those aged 25 and over (the NLW) will not increase in October 2016, but all of the rates will then be uprated in parallel from April 2017.
National minimum wage penalties
Penalties for non-payment of the national minimum wage will increase from 1 April 2016. Employers paying below the minimum wage currently face a fine equal to 100% of the underpayment owed to each worker, but this will double to 200% of the arrears owed if the debt is not cleared within 14 days.
The maximum penalty will remain at £20,000 per worker (previously the entire fine was capped at £20,000). The enforcement rule is the same for non-payment of the NLW.
Draft legislation has been published which would require employers to pay an annual apprenticeship levy...
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