Employment Law Change 2017: What you need to know - Mitrefinch


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Employment Law Change 2017: What you need to know

Published: February 9, 2017

The requirement to comply with employment law goes without saying, so it’s of paramount importance that your business is ticking all the boxes. This year is set to see a number of significant changes come into place, from data protection to employing foreign workers – some of which will result in increased costs, while non-compliance with others could result in hefty fines, so businesses beware!

Here’s a quick overview of six major changes that are set to keep HR departments busy in 2017.

Gender pay gap reporting

Over the last few years, the light being shined on the gender pay gap has become brighter, culminating in the 2017 requirement for employers with 250 employees or more in the private, voluntary and public sectors to report gender pay gap information for the first time.

With the first report deadline expected in April 2018, organisations that meet these criteria will be required to publish employee pay and bonus pay information, along with numbers of men and women in each pay bracket, relating to data from 2016/17.

Prepare to protect

Data protection will be big news in 2017, due to the implementation of the EU General Data Protection Regulation (GDPR). While the regulations don’t actually take effect until May 2018, the preparation required is expected to dominate employers’ agendas over the next 12 months.

Such preparation will include auditing the personal data of employees kept on file to make sure it’s compliant with the GDPR’s employee consent conditions, as well as creating or amending policies and processes relating to data breach responses, subject access requests and privacy notices.

Failure to comply could cost you; as the regulations will be introduced in May 2018 – before the UK leaves the EU – those businesses not following procedures by that date risk being fined up to €20 million, or four per cent of annual worldwide turnover, whichever is higher.

National minimum wage

Increases to the national minimum wage continue to bump up many businesses’ payroll figures and the next round of changes will take place on 1 April 2017. This includes the national living wage, which for staff aged 25 or over will increase to £7.50 an hour.

Foreign worker charges

From April 2017, organisations paying for general (tier 2) visas to facilitate the employment of foreign workers will be obliged to pay an immigration skills charge of £1,000 per worker (£364 for small employers and charities) on top of fees for visa applications.

At the same time, the minimum salary threshold for ‘experienced workers’ applying for these visas will be increased to £30,000. There will be some exemptions to this until 2019, though, namely in the health and education sectors.

Apprenticeship levy

From 6 April 2017, employers with an annual payroll of over £3 million will have to pay a 0.5 per cent levy on their total pay bill. The levied amounts – as well as an additional 10 per cent from the Government – will be accessible by large employers to use for apprenticeship schemes provided by accredited training providers.

Smaller businesses’ training and development programmes will also benefit from the changes. Those small enough to be exempt from the levy will also be able to receive funding for accredited apprenticeships by contributing 10 per cent towards its cost, with the Government paying the rest.

Restrictions to salary sacrifice schemes

From 6 April 2017, tax savings made possible by many salary sacrifice arrangements will be abolished, leaving employers to reconsider the benefits they offer their employees. Luckily, schemes relating to pension savings, childcare, ultra-low emission cars and cycling to work – which covers off most businesses’ benefits arrangements – will remain unaffected. And, as long as they were in place before April 2017, those schemes not covered by this will also be protected until April 2018, apart from transport, accommodation and school fee schemes which will be granted protection until April 2021.

With these being just a few of the top priorities this year, 2017 looks set to significantly alter the employment landscape in the UK. Is your business ready?

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