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What the Autumn Statement means for Employment

Following Chancellor Philip Hammond’s Autumn statement Alex Pearce, an employment law specialist, looks at those measures relevant to employers and employees.

From April 2017 employees participating in salary sacrifice schemes, in which an employee gives up part of their salary for a non-cash benefit with both the company and worker paying less tax, will be abolished. Most medium and large organisation offer salary sacrifice schemes, which may include gym memberships and mobile phone deals. This is likely to affect lower paid workers the most. Child care, ultra-low emission cars and cycling to work will not be affected. There is some limited comfort with any arrangement in place before April 2017 being protected until April 2018.

Mr Hammond also announced changes to the income tax threshold, which will increase to £11,500 in April 2017. The government will increase the higher rate income tax threshold to £50,000 by the end of the Parliament.

The National Living Wage to rise will increase from £7.20 an hour to £7.50 from April 2017.

Employer and employer NI thresholds will be equalised at £157 per week from April 2017.

Employers are advised to contact their accountant to discuss how these changes will affect their business in advance of the changes. You are also advised to speak to your employment lawyer regarding updates to employment contracts to reflect any changes to salary sacrifice schemes.

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Changes to new minimum wage rates

Alex Pearce, employment law solicitor, reminds us that the new minimum wage rate comes into effect today.

From 1st October 2016 the new minimum wage rate increase comes into effect. The increases now mean that those aged over 21 years will benefit from a 4% pay rise:

21-24 year olds increases from £6.70 to £6.95
18-20 year olds increases from £5.30 to £5.55
16-17 year olds increases from £3.87 to £4.00
Apprentice rate increases from £3.30 to £3.40

(From 25 years you are entitled to the national living wage. This did not change on 1 October)

'New To work' guidance

ACAS has also published new guidance for young people who are starting work for the first time, setting out what their rights and obligations are. The guidance provides essential advice on legal issues that young people may face at work, including special employment rights for 16 and 17 year olds, information on apprenticeships and the national minimum wage.

Read more here 

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Tougher penalties for employing illegal immigrants

Alex Pearce, our employment law solicitor, advises on how employers can avoid illegal working traps.

On 12 July 2016 changes to illegal working offences in the Immigration Act 2016 came into force, introducing tougher penalties for employers found to be flouting the rules.

As the government is keen to crack down on employers who turn a blind eye to employing illegal migrants, with fines of up to £20,000 per illegal worker and possible disqualification for directors, it is more vital than ever for employers to make sure employees have the correct right to work documents. The Home Office also names and shames employers found employing an illegal worker, so your business reputation could be on the line too.

Alex Pearce, employment law specialist at Pinney Talfourd in Essex, advises on how employers can avoid illegal working traps.

Checking workers’ status

Under current law, employers can only legally employ an individual who has permission to live and work in the UK.

To stay on the right side of the law, you will need to ensure that your existing procedures for checking that all new workers have the legal right to work in the UK are being complied with before they start work. Also, you should ask to see the documentation of existing workers and diarise reminders to check the paperwork again when their documents are near to expiry. As long as you make these checks, and take action where necessary, there will be nothing to fear.

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