April – when spring has finally sprung, Easter eggs are gorged upon and national minimum wages inevitably increase. This year sees April also bringing a range of long awaited legislative changes which employers of all sizes need be aware of. So grab a creme egg whilst they’re still available and check out our snapshots of what’s to come.
Gender Pay Gap reporting – it’s time to crunch those numbers
The private sector gender pay gap information regulations come into force on 6 April 2017 and the official countdown to the reports being published begins. Private and voluntary sector organisations with 250 or more employees will need to produce their first report by 4 April 2018, which is to be based on a ‘snapshot’ of their pay gap on 5 April 2017.
Public sector employers will be subject to similar requirements although their ‘snapshot’ date will be 31 March each year.
You may be unaware of the gender pay gap in your business. Even if your organisation complies with equal pay legislation, a gender pay gap is likely to exist.
There are many ways in which we can assist you prepare for your first report, including helping you to prepare the figures, analyse the cause of any gender pay gap and put together an action plan of steps you can take to address the gap. What’s more any advice we give you will be covered by legal privilege, meaning you won’t be required to disclose what we say in future proceedings.
Apprenticeship levy – collection commences
Another one for the larger organisations across all industry sectors – the Apprenticeship levy comes into force on 6 April 2017. As part of its drive to boost employment and training opportunities to young workers, the Government wants to increase the apprenticeships in England to 3 million by 2020, but it needs funding to help achieve that goal.
Employers will receive an allowance of £15,000 to offset against the levy payment, resulting in any with a wage bill of more than £3million having to commit 0.5% of their wage bill (excluding payments such as benefits in kind) to the fund via PAYE.
However, group companies will only have one allowance between them so it’s important for smaller businesses to be aware of how the levy could affect them too.
The funding generated will be accessible via a new digital service, which is expected to be operational from 1 May 2017 and will distribute the funds raised for employers to use on apprenticeship training and assessment within their organisation. Separate arrangements for the funding will be applicable in Wales, Scotland and Northern Ireland.
If you are still unsure what your obligations are under the apprenticeship levy, or how you may be able to benefit from the levy funding, contact our team for advice here. We will be hosting an Apprenticeship Levy breakfast briefing - keep an eye on our Eventrbite profile to sign up for free.
New charge for Immigration skills – calling all Tier 2 sponsors
The Government has committed to reducing migration to the UK and announced a series of policy changes to the Tier 2 (General) migration route. As part of this, if your organisation is planning on sponsoring skilled workers under Tier 2 (General) of the points based system, as of 6 April 2017 you will need to pay the Government’s new Immigration Skills Charge (ISC). It is a flat rate of £1,000 per person per year of their sponsorship (£364 for small employers and charities).
The ISC is payable at the point a certificate of sponsorship (CoS) is assigned, although there are some exemptions. The ISC does not apply to CoS assigned prior to 6 April 2017 or to current Tier 2 workers already in the UK who wish to extend their stay or change their job or employer.
For those Tier 2 workers in education, social care and health sectors, the Government will also require them to obtain criminal records certificates from the countries the worker has lived in over the last 10 years.
Finally, the Tier 2 (General) salary threshold will be increasing from 6 April 2017 to £30,000 for migrants who are “experienced workers”.
If you would like more information about these changes, or general advice on the immigration points based system, contact Alex Christen here.
Government limits salary sacrifice tax advantages
As of 6 April 2017, the Government introduces a limit on the Income Tax and NIC advantages where benefits in kind are offered through salary sacrifice or where employees can choose between cash allowances and benefits in kind (BiK).
The taxable value of the benefit will be fixed at the higher of the current value or the cash forgone.
There are some exemptions and arrangements already in place are protected until April 2018, or April 2021 for certain benefits.
Money money money – NMW and statutory pay rates
And finally, an April update would not be complete without mentioning the increases to national minimum wages and statutory pay rates. These were covered in this month’s Newsbytes, which can be found here and include national minimum wage and national living wage increases, as well as statutory family pay rates.