Ringing the employment law changes in 2016

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With 2016 set to deliver a number of changes in employment legislation, we look ahead and summarise the key elements so you can ensure your business is prepared. For more in depth coverage on the Modern Slavery Act, look out for our practical seminar.

National Living Wage

The new National Living Wage (NLW) will apply from 1 April 2016. This is effectively a premium on the National Minimum Wage (NMW) for workers aged 25 or older. The first NLW rate will be £7.20 per hour, which is 50p per hour more than the NMW. The NLW is separate to the living wage, which is a voluntary, recommended rate used by the Living Wage Foundation. We will be focussing on the NLW in our Spring Employment Law Updates.

Modern Slavery Act

The Modern Slavery Act 2015 requires commercial organisations with a total global turnover of £36 million or more (which includes the turnover of the organisation's subsidiaries) to publish an annual ‘slavery and human trafficking statement’. The first modern slavery and human trafficking statements will be due from businesses with a financial year end of 31st March 2016 or after. There is no legislative time frame for publishing these statements, but Home Office guidance envisages statements will be published as soon as is reasonably practicable after the organisation’s applicable year end, and certainly within six months of this date. Click here for more information on the reporting provisions of the Modern Slavery Act and here for details of EEF’s Modern Slavery Business Transparency Seminars.

Gender pay reporting

This year, regulations will be introduced which provide long awaited detail about the requirement for organisations with 250 or more employees to report on their gender pay gap. We anticipate that the regulations will come into force in October 2016, though we expect there to be some lead time before the first reports have to be published.

Zero hours contracts

Exclusivity clauses in zero hours contracts were prohibited last year. Regulations which give employees the power to complain to an employment tribunal where they have been dismissed or subjected to a detriment following breach of an exclusivity clause have just come into force.

Data protection

The European Parliament and the Council has reached agreement on the EU data protection reform package, which includes the General Data Protection Regulation. The new regulation is expected to apply to the UK in early 2018. With the introduction of a potential sanction of up to 4% of global turnover for breaches of data protection law, data protection compliance is set to become a priority for business. We will keep you informed of developments and will run a National Seminar in Autumn 2016 to help you prepare.

Industrial action

The Trade Union Bill is continuing its passage through Parliament. Amongst other things, this Bill proposes more stringent requirements in relation to balloting for industrial action, picketing during industrial action and allowing employers to employ agency workers during disputes.

Employing illegal workers

The Immigration Bill, which is also still being debated by Parliament, will make it easier to prosecute employers who deliberately‘turn a blind eye’ to employing illegal workers and will make sanctions tougher.

Statutory parental pay rates and sick pay

There will be no annual increase in the weekly rate of statutory sick pay and statutory maternity pay, statutory paternity pay, statutory adoption pay and statutory shared parental pay in 2016.

Termination payments

Last year, the Government consulted on the simplification of the tax and NICs treatment of termination payments, but are yet to publish their response to the consultation. They are proposing the removal of the £30,000 tax free element, replacing it with a tax exemption based on length of service.

Grandparents and volunteers

The government has plans to extend shared parental leave and pay to working grandparents by 2018 and has indicated that it will consult on this in the first half of the year. It has also committed to giving workers up to three days off a year to do voluntary work, but no date has yet been given for consulting on this.

EEF will continue to update you on the latest developments throughout the year. For more in-depth coverage take look at our programme of seminars & events which are ideal for keeping on top of an evolving employment law agenda. Dates for our popular Spring Employment law update will be released soon.


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Principal Legal Adviser

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