With 2020 well in the rear view mirror, now is the time to look forward. That’s not to say that there isn’t a lot for agencies to juggle in 2021!
Indeed, as well as the residual impact of the pandemic, there are several key new employment laws recruiters and employment businesses should be aware of.
Here are 6 of the most important to keep on your radar:
1. New EU immigration rules
As 2020 came to an end, so did the Brexit transition period, and with it freedom of movement in the EU.
From the 1st January 2021 a new immigration system came into effect for all EU citizens (excluding Irish citizens) arriving in the UK. New arrivals need to ensure they have a visa in advance. However, they have no legal obligation to provide a copy at this stage.
However from 30th June 2021, employers will have a responsibility to ensure and document that any worker has the appropriate Right to Work in the UK.
2. Off payroll working rules
Changes to the off-payroll tax legislation, IR35, which were due to be implemented in April 2020 were delayed by a year because of the coronavirus crisis.
This year there is no escape. From 6th April 2021, it will become the responsibility of medium and large businesses to determine the IR35 status of the limited company contractors they engage.
For every contract, end clients will have to communicate a “Status Determination Statement” down their supply chain.
Under the new rules it becomes the duty of the fee payer – the party paying the limited company – to deduct appropriate employment tax and NI if a contract is assessed as being inside IR35.
3. The end of furlough
If you currently have members of staff on furlough, be aware that the scheme is set to end on 30th April 2021.
Decide on the next steps in terms of whether you can afford to continue to pay staff without the scheme. If not, are there any alternatives to redundancies? These may include:
- Early retirement or voluntary redundancies
- Flexible working arrangements
- Temporary lay offs
- Reduced working hours
4. Extra redundancy protection for pregnant employees
If you do need to go down the redundancy route, first you need to consider if you can retain staff by offering them alternative roles. It has always been the case that staff on maternity leave should be the first to be offered any such opportunities.
At some point this year, new rules will change how long this protection lasts. The employee will be protected as soon as they announce their pregnancy, until 6 months after they return from maternity leave.
5. Changes to modern slavery statements
Last July, the government announced tougher plans to tackle modern slavery.
More companies will required to produce modern slavery statements, so you might need to publish one if you don’t already.
For example, public sector companies, not just the private sector, will have to create a statement if their turnover exceeds £36 million.
The structure of the modern slavery statement is also due to change.
Keep an eye out for these updates, and as soon as new government guidance is available we will share the detail, so watch this space.
6. Wage changes
Last, but certainly not least in our list are changes to the minimum and National Living Wage (NLW)
From 1st April there will be wage increases across all age groups. From the same date, the NLW will expand to include all workers aged 23 and over.
New hourly rates
|National Living Wage||£8.72 to £8.91 (2.2% increase)|
|Age 21-22||£8.20 to £8.36 (2.0% increase)|
|Age 18-20||£6.45 to £6.56 (1.7% increase)|
|Age 16-17||£4.55 to £4.62 (1.5% increase)|
|Apprentice rate||£4.15 to £4.30 (3.6% increase)|
Statutory pay changes
- From 6th April 2021, Statutory Sick Pay (SSP) will increase from £95.85 to £96.35 per week
- From 4th April 2021, parental pay will increase from £151.20 to £151.97 per week. This includes maternity, paternity, adoption, shared parental and parental bereavement pay.
As a large employer, both of contractors and local head office staff, we have extensive employment and tax law experience in-house.
Our Head of Operations, Joe Taffurelli, also sits on the board of the FCSA, so we have access to the latest updates, straight from the horse’s mouth.
If you have concerns about changes in legislation, please get in touch and we’ll do our best to help.