There are still a number of proposed legislative changes for which we are anticipating further consultations or awaiting a Government response, and for which we have no confirmed implementation dates. It seems highly likely that most of these changes will be pushed back to 2022 and beyond. In the meantime, a summary of what to look out for in 2021 follows:
|1 January 2021
New Immigration Rules
The end of the transition period on 31 December 2020 meant the end of free movement between the UK and EU with effect from
1 January 2021.
Non-UK citizens without settled status will now have to meet the requirements of the new points-based immigration system, which was introduced on 1 December 2020. Those employers seeking to recruit non UK workers must have a sponsor licence. EU citizens who were already living and working in the UK by 31 December 2020 have until 30 June 2021 to apply for settled or pre-settled status.
For more information on retaining your EU workforce, read our previous article.
Statutory pay rates increase (date to be confirmed)
Increases to Statutory Sick Pay (SSP): £96.35 per week
Increases to family leave pay (including SMP): £151.97 per week
|4 April 2021
Gender pay gap reporting
Businesses with 250 or more employees must report their gender pay gap by 4 April 2021, based on the ‘snapshot date’ of 5 April 2020. For public sector employers, the deadline is 30 March, based on a snapshot date of 31 March 2020.
The report must be submitted to the Government’s online portal and the information published on a publically accessible website. Note, the requirement to report on an organisation’s gender pay gap was suspended in 2020.
Further guidance is available on the Government website.
|6 April 2021
National Minimum Wage
Confirmed increases to the current hourly rates of national minimum wage and the national living wage, in line with recommendations of the low pay commission will take effect on 6 April 2021:
Apprentice rate: £4.30
Age 16-17: £4.62
Age 18-20: £6.56
Age 21-22: £8.36
Age 23+: £8.91 (national living wage)
|6 April 2021
Significant changes to existing rules relating to the taxation of off-payroll workers, known as ‘IR35’, were due to take effect on 6 April 2020. These were postponed due to the COVID-19 pandemic, and are now due to take effect on 6 April 2021.
The new rules will shift responsibility for determining the tax status of contractors working through intermediaries, from the intermediary (commonly a personal service company, or PSC) to the end user organisation. The end user or ‘client’ organisation will be responsible for deciding whether the IR35 rules apply, meaning that the individual contractor should be taxed as an employee. The ‘fee payer’ responsible for paying the intermediary will be required to deduct PAYE and National Insurance contributions from the fees paid for the contractor’s services, if they are deemed an employee for tax purposes.
For more information, read our previous article.
|30 April 2021
Furlough Scheme ends
The Government has extended its Coronavirus Job Retention Scheme to 30 April 2021, and will continue to pay up to 80% of the wages of furloughed employees until then (less for those who are furloughed for only part of their normal hours). Employers still have to pay National Insurance contributions and pension contributions in respect of their furloughed employees.
The Government’s previously announced Job Retention Bonus will no longer be payable as originally intended in February and the Job Support Scheme (announced in September 2020) will not be introduced for the time being.
For further information on the extended scheme see our previous article (note, the Scheme has been extended to 30 April 2021 since this article was published).
|Date not known
The Queen’s speech back in December 2019 outlined the Government’s plans to introduce an Employment Bill, to cover a number of proposed reforms:
- a new right for carers to take an additional period of one week’s unpaid leave per year
- a right for new parents of babies requiring neonatal care to take up to 12 weeks additional neonatal leave, paid at the statutory rate for eligible employees
- enhancing redundancy protection for female employees during pregnancy and after return from maternity leave
- making flexible working available by default, unless the employer has a good reason for not allowing it
- various changes arising out of the Government’s Good Work Plan, including a right for workers to request fixed working hours after a qualifying period of 26 weeks, a ban on deductions from staff tips and the introduction of a single labour market enforcement agency.
Some of these proposals have already been the subject of consultations; others still need to be consulted on by the Government. A timescale for the introduction of these reforms has not been confirmed, although it is rumoured that a draft Bill might be published mid to late 2021.
These articles are from the January 2021 issue of Employment and Immigration Law Update, our monthly newsletter for HR professionals. To download the latest issue, please visit the newsletter section of our website. For further information please contact Liz Stevens or another member of Birketts' Employment Law Team.
The content of this article is for general information only. It is not, and should not be taken as, legal advice. If you require any further information in relation to this article please contact the author in the first instance. Law covered as at January 2021.