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National Minimum Wage increase – April 2019

by | Mar 4, 2019 | Newsletter

The legal minimum hourly rates for workers will increase as follows from 1 April 2019 (to be applied to the employee’s next pay reference period after that date):
  • from £7.83 to £8.21 for workers aged 25 and over (the National Living Wage)
  • from £7.38 to £7.70 for 21-24 year olds
  • from £5.90 to £6.15 for 18-20 year olds
  • from £4.20 to £4.35 for 16-17 year olds
  • from £3.70 to £3.90 for apprentices aged under 19 or in the first year of their apprenticeship.

Extending Maternity Rights Consultation

by | Feb 28, 2019 | Newsletter

The Department for Business, Energy & Industrial Strategy (BEIS) has opened a consultation seeking views on proposals to extend the redundancy protection of new mothers from the date they notify their employer in writing of their pregnancy to six months after their return from maternity leave. 

The consultation document deals with the proposals to extend the time limit to bring an employment tribunal claim in pregnancy and maternity discrimination cases from three to six months.  Although the consultation does not ask any questions relating to extending the tribunal time limit, it does state that the Government has committed to consult to explore the evidence for changing employment tribunal time limits for claims relating to discrimination, harassment and victimisation, including on grounds of pregnancy and maternity.  

Watch this space!

Supermarket Iceland being pursued for £21 million by HRMC

by | Feb 26, 2019 | Newsletter

Iceland offered employees the chance to pay into a Christmas Club scheme, where they could put money aside over the course of the year towards Christmas expenses. £3.7 million of wages were saved this way. 

However, because the cash was deducted before it reached staff, it pushed some staff below the minimum wage threshold. 

Iceland are not the first business to be named and shamed for failing to pay the minimum wage. Wagamama, had the largest underpayment, which they blamed on rules regarding employees uniform.  Debenhams was fined £63,000 for minimum wage breaches in 2017.

If you have any questions about how benefits or schemes could affect the minimum wage then please contact us now.

Supermarket Iceland being pursued for £21 million by HRMC

by | Feb 20, 2019 | Newsletter

Iceland offered employees the chance to pay into a Christmas Club scheme, where they could put money aside over the course of the year towards Christmas expenses. £3.7 million of wages were saved this way. 

However, because the cash was deducted before it reached staff, it pushed some staff below the minimum wage threshold. 

Iceland are not the first business to be named and shamed for failing to pay the minimum wage. Wagamama, had the largest underpayment, which they blamed on rules regarding employees uniform.  Debenhams was fined £63,000 for minimum wage breaches in 2017.

If you have any questions about how benefits or schemes could affect the minimum wage then please contact us now.

Employment Status in the “gig economy”

by | Feb 5, 2019 | Newsletter

There have been a number of recent legal rulings finding that individuals who are categorised by businesses as self-employed contractors are, in reality, workers or employees who are entitled to minimum worker benefits, such as the National Minimum Wage, statutory paid holiday and sick pay. 

The trend has been for more and more individuals working for businesses, where the work they do is largely controlled by the business but they do not enjoy employee or workers’ rights, to be recognised by the tribunals as workers.  Unfortunately, determining the employment status of individuals is a complex task for businesses.  There have been calls to simply the law in this area. 

In 2016, the Government commissioned an independent report on modern working practices and the employment status of contractors working within the “gig economy”. The Government finished consulting with businesses and other interested parties on this report in June 2018. The Government have introduced draft legislation to Parliament.  The new legislation, which is scheduled to come into force in April 2020, includes:
  • closing a loophole by repealing the Swedish derogation – which currently allows agency workers to be employed on cheaper rates than permanent counterparts
  • extending the right to a day one written statement of rights to workers, going further to include detail on rights such as eligibility for sick leave and pay and details of other types of paid leave, such as maternity and paternity leave
  • increasing the maximum employment tribunal fines for employers who are demonstrated to have shown malice, spite or gross oversight from £5,000 to £20,000
  • extending the holiday pay reference period from 12 to 52 weeks, ensuring those in seasonal or atypical roles get the paid time off they are entitled to
  • lowering the threshold required for a request to set up Information and Consultation arrangements from 10% to 2%
Additional proposals set out in the Government’s response, for which the Government has not yet introduced legislation or a timetable of reforms include:
  • Empowering the Employment Agency Standards Inspectorate to monitor the role of the umbrella companies and to ensure that agency workers are receiving adequate pay without inappropriate deductions being made.
  • Introducing a new single labour market enforcement agency to support workers and advise them of their rights.
  • Clarifying the employment status test and aligning the employment status frameworks for employment and tax purposes in order to reduce any differences between the two systems.
  • Introducing a right for “zero hour” or “casual hour” workers to request a more predictable and stable working pattern after 26 weeks of service.
  • Extending the time required to break a period of continuous service between contracts from one clear week to four clear weeks to make it easier for employees to access their statutory rights, which are based on length of service.
  • Prohibiting deductions from staff tips.
To clarify, there are no plans to end the use of “zero hour” contracts.  The Government has made clear that it recognises the varied ways of working, wants to ensure the workforce remains flexible, but whilst guaranteeing key protections for workers which the above proposals and legislation is designed to address.