An update on the changes in UK employment legislation that will take effect in April and May this year.

April 2018

Auto enrolment pension contribution rates

The minimum pension contributions set by the UK government for automatic enrolment will increase in April 2018. This increase will take the total minimum amount to 5% (with at least 2% from the employer). From April 2019, it’ll rise again – to a total of 8% (with at least 3% from the employer). This assumes that minimum pension contributions are being calculated on qualifying earnings.

Both employers and employees may need to contribute more than they currently do, unless more than the minimum contribution is already being paid. Employers should let employees know if they’ll be paying more.

Visit www.thepensionsregulator.gov.uk for more information.

Gender pay gap reporting

Under the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017, private and voluntary sector employers in England, Wales and Scotland with 250 employees or more will be required to publish information by 4 April, 2018 about the differences in pay between men and women in their workforce, based on a pay bill ‘snapshot’ date of 5 April, 2017. Provisions under the Northern Irish Employment Act 2016 mirror these, except they also include fines of up to £5,000 for non-compliance and a requirement to report on ethnicity and disability pay gaps, as well as gender pay gaps.

Visit www.gov.uk for more information.

Taxation of termination payments

From April 2018, the government plans to make changes to the taxation of termination payments, including:

· removing the distinction between contractual and non-contractual payments in lieu of notice (PILONs) so that all PILONs are taxable and subject to Class 1 NICs;

· ensuring that the first £30,000 of a termination payment remains exempt from income tax and that any payment paid to any employee that relates solely to the termination of employment continues to have an unlimited employee NICs exemption;

· aligning rules for income tax and employer NICs so that employer NICs will be payable on payments above £30,000 (currently only subject to income tax).

Visit www.gov.uk for more information.

Employment allowance restrictions for employing illegal workers

The government plans to introduce a further deterrent to the employment of illegal workers. From April 2018 employers will not be able to claim the Employment Allowance for one year if they have:

· hired an illegal worker;

· been penalised by the Home Office;

· exhausted all appeal rights against the penalty.

Visit www.gov.uk for more information.

May 2018

General Data Protection Regulation

The General Data Protection Regulation (GDPR) comes into effect on 25 May, 2018 (see The Mover January 2018, page 32). The new rules give individuals:

· easier access to their own data;

· a ‘right to be forgotten’;

· a right to know when their data has been hacked.

Organisations will benefit from having a single set of data protection rules across the EU (the UK is implementing GDPR despite Brexit) and a single supervisory authority, rather than 28. Companies may be liable for a fine of up to 4% of global turnover if they breach the regulation.

Visit www.ico.org.uk for more information.

Photo; Businesses with over 250 employees are required to publish information by 4 April, 2018 about the differences in pay between men and women in their workforce.