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Miller Samuel Hill Brown Solicitors Blog

From time to time we will post news articles and announcements relating to the firm and to various legal issues that may be of interest to you.

Employment Law in 2018

The start of a new year is a time for looking ahead and planning for what is to come in the next 12 months. To assist, this is the first of two blogs we will be posting this week considering what is going to be happening in the world of employment law in 2018.

This blog highlights the legislative changes presently scheduled to take place this year; our second blog which will be posted at the end of this week will look at some of the more important cases which will be decided this year and which are likely going to have implications for employers and how they operate on a day to day basis.

Immigration – January 2018

The first reading of the new Immigration Bill is expected in January 2018. The bill is expected to cover the whole of the UK and will establish a new national policy on immigration, including new powers concerning the immigration status of European Economic Area (EEA) nationals. While not amounting to a legislative change directed at employment law per se, the Bill will allow the government to repeal EU law on immigration, primarily free movement, which otherwise would have been saved and converted into UK law by the Repeal Bill. The migration of EU nationals and their family members will be made subject to relevant UK law after Brexit.

Gender Pay Gap (Public Sector) – March 2018

Under the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017, public sector employers in England, Wales and Scotland with 250 or more employees must publish reports setting out the pay differences between men and women employed by them. First reports must be published before 30th March 2018 with the relevant information provided being based on a snapshot date of 31st March 2017.

The report must be accompanied by a signed statement from the employer that the information that has been provided is accurate and correct. The results detailed in the report are required to remain on the employer’s website for a period of at least 3 years.

The results that are published need to have been based on the calculations below:

  • Salary quartiles – the proportions of male and female full pay relevant employees in the lower, lower middle, upper middle and upper quartile pay bands.
  • The mean gender pay gap – the difference between the mean hourly rate of pay of male full pay relevant employees and that of female full pay relevant employees.
  • The median gender pay gap – the difference between the median hourly rate of pay of male full pay relevant employees and that of female full pay relevant employees.
  • The mean gender bonus gap – the difference between the mean bonus pay paid to male relevant employee and that paid to female relevant employees.
  • The median gender bonus gap – the difference between the median bonus pay paid to male relevant employees and that paid to female relevant employees.
  • The proportion of men and women who received bonuses – the proportions of male and female relevant employees who were paid bonus pay during the relevant period.

From April 2018, figures will have to be reported annually.

Gender Pay Gap (Private and Voluntary Sector) – April 2018

Private and voluntary sector employers that have at least 250 employees will also be required to publish reports under the terms of the Gender Pay Gap regulations setting out the pay differential between men and women. These reports must be published by 4 April 2018 and should be based on information as at a snapshot date of 5 April 2017.

The details that require to be included in these reports mirror those that public sector employers require to provide, as set out above.

Statutory Rates – April 2018

  • The National Living Wage for workers aged 25 and over will increase to £7.83 per hour.
  • The National Minimum Wage for workers aged at least 21 but under 25 will increase to £7.39 per hour.
  • The National Minimum Wage for workers who are aged at least 18 but under 21 will increase to £5.90 per hour and for those aged 16 or 17 it will be increased to £4.20 per hour. The rate for apprentices will be £3.70 per hour.
  • Statutory Sick Pay will increase to £92.05 per week.
  • Statutory Maternity Pay, Statutory Paternity Pay, Shared Parental Pay and Statutory Adoption Pay will increase to £145.18 per week.

All of these increases will apply from 6th April 2018.

Income Tax Thresholds – April 2018

As declared in Autumn Budget 2017, the personal income tax allowance will be increased to £11,850 and the higher rate tax threshold will be £46,350 as from 6th April 2018.

Employer Contribution for Pensions – April 2018

The Employers’ (Implementation) Regulations 2010 (SI 2010/4) as amended by the Employers’ Duties (Implementation) (Amendment) Regulations 2016 (SI 2016/719), implement a scheduled increase in the minimum percentage that an employer pays into a pension auto-enrolment scheme. The planned increase is 1% to 2%.

Taxation of Termination Payments – April 2018

From April 2018, the exemption from income tax and National Insurance Contributions (NICs) for termination payments up to the current threshold of £30,000 will be retained. However, employer NICs will be payable on payments above £30,000: this will have financial implications for employers who provide termination packages in excess of £30,000.

Restricting Employment Allowance – April 2018

From April 2018, the Employment Allowance will be removed for a period of one year for those who receive civil penalties from the Home Office for employing illegal workers and have exhausted their Home Office appeal rights in relation to that civil penalty. This new exclusion is to be introduced under the Employment Allowance (Disqualified Persons) Regulations 2017.

General Data Protection Regulation – 25 May 2018

The General Data Protection Regulation will apply in all Member States from 25 May 2018. Some of the key changes being made by the GDPR are the following:

  • Increased territorial scope – it applies to all companies that are processing the personal data of data subjects residing in the EU. It applies to the processing of personal data by controllers and processors in the EU, regardless of whether the processing takes place within the EU or not.
  • Tougher penalties – a breach of the GDPR could result in tougher financial penalties, being a fine equating to the higher of 4% of annual worldwide turnover of the data controller or €20,000,000. Breaches may include breaches of the principles for processing, international transfer restrictions, data subjects’ rights etc.
  • Right to claim compensation – the GDPR makes it significantly easier for individuals to bring private claims against data controllers and processors.
  • Consent – a company will now have to request consent (where this is their basis for processing the data) in an intelligible and easily accessible form, using language that is basic and plain. It has to be simple for individuals to withdraw their consent.
  • Investigations and Corrective Powers – it will be possible for the supervisory authorities to carry out on-site data protection audits. They will also have the power to issue public warnings and give orders to companies to carry out activities to remedy certain breaches.
  • Data Protection Officers – organisations must appoint a data protection officer if (1) they are a public authority, (2) they are controllers or processors whose core activities consist of processing operations which by virtue of their nature, scope or purposes require regular and systematic monitoring of data subjects of a large scale, (3) they are controllers or processors whose core activities consist of processing sensitive personal data on a large scale. Data protection officers need to have expert knowledge of data protection law and have to be involved properly and in a timely manner in all issues which relate to the protection of personal data.

Trade Secrets Directive – 9th June 2018

The Trade Secrets Directive (2016/943/EU) introduces an EU-wide definition of “trade secret”: any information that is secret, has commercial value because it is secret, and has been subject to reasonable steps by the holder of the information to keep it secret.

Member states have until 9th June 2018 to transpose the Directive into their national law.

Other Forthcoming Legislative Changes in 2018

Grandparental Leave - The Government intends to bring legislation into force in 2018 to extend Shared Parental Leave to include grandparents. If the scheme is extended then it is likely that mothers will be able to share leave with grandparents in the same way that they can currently share it with fathers/partners. However, a consultation on the final implementation of this proposal has yet to take place.

Brexit Implications

While Brexit is likely to loom large by the time we reach the end of 2018, it seems very unlikely that the UK Government will take steps to materially alter existing employment laws which currently implement EU minimum requirements as a result of this. A significant amount of EU employment law has been brought into force in the UK by way of UK legislation and so this will remain effective after Brexit unless it is amended. Another reason why there is cause to suspect only limited changes will flow from Britain’s exit from the EU is that a lot of EU rights were already legislated for on a UK basis, prior to the introduction of relevant EU law.

In an effort to give workers and employers some legal certainty, the government has established that questions relating to the interpretation of preserved EU-derived law will be determined in UK courts in relation to the case law of the Court of Justice of the European Union, as it stands on the day that the UK leaves the EU. Whether this proves to be an acceptable basis to deal with matters is something only time will tell.

If you would like further information on any of the topics below, or have any other employment law related query, then please do not hesitate to contact us.

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