April 2014
Pensions automatic enrolment:
Automatic enrolment is the main employer duty under the new laws on workplace pensions. It’s called automatic enrolment because employers will need to enrol certain staff into a pension scheme ‘automatically’, without those staff having to do anything.

You must automatically enrol everyone working for you:

• who is aged between 22 and state pension age
• who works in the UK
• for whom you deduct income tax and National Insurance contributions from their wages
• who is likely to have gross earnings over £10,000 in a year

Automatic enrolment duties come into force for you from your ‘staging date’. You can find out your staging date by entering your PAYE reference into this tool.

Time period of auto-enrolling eligible employees into pension schemes increases (from 1st April 2014):

• An increased grace period from one month to six weeks available for employers to auto-enrol employees into a qualifying pension scheme

Statutory pay rate increases (from 6th April 2014): 

• The rate of statutory maternity pay, ordinary and additional statutory paternity pay and statutory adoption pay will increase to £138.18
• Statutory sick pay increases from £86.70 per week to £87.55 per week
• The standard rate of statutory redundancy pay will be capped at £464

The Enterprise and Regulatory Reform Act 2013 will implement the following (from April 2014):

• Tribunals will be given the power to impose financial penalties on employers that have been found to have breached employment rights where the breach has one or more aggravating features (conditions which worsen the breach of rights in some way). While there is no specific definition provided, it will be more likely considered to be aggravating feature where:

1. the action was deliberate or committed with malice;
2. the employer was an organisation with a dedicated human resources team; or
3. where the employer had repeatedly breached the employment right concerned

The employment tribunal may be less likely to find that the employer’s behaviour in breaching the law had aggravating features where:

• an employer has been in operation for only a short period of time;
• is a micro business;
• has only a limited human resources function; or
• the breach was a genuine mistake

Penalties for aggravating features will vary from £100 up to a maximum of £5,000.

• A requirement for employment tribunal claimants to inform ACAS details of their claim, to allow ACAS to offer them the services of a conciliation officer. A conciliation officer is an appointed neutral third party, who attempts to bring together the two parties and attempts to reconcile their differences. If conciliation is unsuccessful within the set period the claimant can proceed to lodge a tribunal claim. (from 6th April 2014)
• The questionnaire procedure that enables an individual who thinks that he or she has been discriminated against to gather information from his or her employer to be used as evidence in a tribunal- this will be abolished (from 6th April 2014)

Yearly Employment Allowance for National Insurance Contributions (1st April 2014):

• The National Insurance Contributions Bill has entitled every business and charity to a £2,000 reduction in employer national insurance contributions (NICs) bills each year

Tax and thresholds changes (from 6 April 2014):

• The income tax personal allowance will increase to £10,000

The Children and Families Bill gives flexible parental leave for parents of children born or matched for adoption (from 5th April 2014):

• Parents will be able to choose how they share childcare during the first year after birth. Mothers will still take at least the initial two weeks following the birth off work, and can opt to share the remaining leave as parental leave.
• This also allows the husband, civil partner or partner of the pregnant woman the right to unpaid time off to attend two ante-natal appointments

June 2014
The Children and Families Bill extends the right to flexible working (from 30 June 2014):

• All employees will have the right to request flexible working (not just those with parental responsibility for a child, or caring responsibilities for an adult)
• The statutory process for considering requests is to “deal with the application in a reasonable manner”
• The employer is required to notify the employee of its decision within a period of 3 months (or longer if agreed)

October 2014
Employment Tribunals given power to order an Equal Pay Audit (October 2014):

• In cases where equal pay provisions have been breached under the Equality Act 2010, employment tribunals are given the power to order an equal pay audit, except in prescribed circumstances (October 2014)

So what might all these changes mean for your business?

• Some of the details in your staff handbook as well as company policies may need updating (flexible working and auto-enrolment for pension schemes)
• Amendments to payroll calculations will need to now include the revisions to statutory sick pay, and increases to state pensions and statutory maternity, paternity and adoption pay
• Employers may expect financial penalties as a result of a breach of employment rights

Other changes which may be implemented during 2014-15 – dates indicated by the government but are yet to be confirmed: 

• Health and Work Service to be introduced by the Government, a free service provided to employees, employers and GPs for assessing the health of employees who have had four or more weeks off sick (To be confirmed)
• National minimum wage rise subject to economic conditions (October 2014)
• Surrogate parents will be eligible for adoption leave (2015)
• School leaving age will rise to 18 (2015)

Look out for our employment law updates throughout the year for advice on how these changes may impact your business.

If you would like advice regarding any of the information listed or would like to make a comment about this newsletter please email us at info@peoplebusiness.co.uk or call us on 01932 874 944.