Employment Law Update: April 2021

Accessing useful information about any employment law changes and how they affect you can be difficult -the good news is that we at People Puzzles have experts on hand with our sister business My Inhouse Lawyer.

Employment law specialist Jonathan Waters highlights some of the ‘must know’ updates to employment law in April 2021.

1. Statutory Payments

It’s that time of the year when the annual increases to various statutory compensation limits are announced. Some of the more important changes are:

With effect from 6 April 2021, the following have been increased:

• The maximum amount of a week’s pay, used for the calculation of a statutory redundancy payment, is increased to £544 per week.
• The maximum compensatory award for unfair dismissals, where the dismissal is on, or after, 6 April 2021 is increased to £89,493.
• The weekly rates for statutory maternity, paternity, adoption and shared parental leave are increased to £151.97 and the weekly rate of SSP to £96.35.
• The ‘headline’ National Minimum Wage for those aged 23 or over has increased to £8.91.

2. Gender Pay Reporting

Following on from the subject of money, private sector employers with 250 or more employees are legally required to publish information about differences in pay and bonuses as between their male and female employees.

The deadline for publication is normally 4 April for private sector employers.

However, due to Coronavirus, the Equality and Human Rights Commission has recently announced that the reporting duty for 2020/2021 will be delayed by 6 months to 5 October 2021.

Please note, that this does not excuse a business from reporting–it simply delays it by 6 months.

3. IR35

Reforms to IR35 for the private sector came into force on 6 April 2021, having been delayed due to Coronavirus.

Under the rules, a business which engages a contractor is responsible for determining their employment status and assessing whether IR35 applies. If it does, there will be tax implications across the supply chain including for the deemed employer and contractor.

Determining a contractor’s ‘true’ legal status is not an easy task, although many on-line tools are available.

To ensure IR35 compliance, it is important that ‘contractor contracts’ are carefully checked.

Not all businesses will be caught by IR35 and there is, for example, an exemption for those businesses which fall within the definition of a ‘small company’–namely, a company which meets 2 of the following 3 conditions: less than 50 employees, an annual turnover of less than £10.2m and a balance sheet of less than £5.1m.

To read more about these or other updates on Employment Status and Immigration and Brexit, you can view the full update from My Inhouse Lawyer here.

If you need any help to work your way through what any of this means, please drop us an email or call us on 02032393307.