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.
MORE INFORMATION For more advice on employing migrant workers, or to update your recruitment policies and documents, reviewing your employment policies or any other employment law matter, contact Alex Pearce, in our Employment Law Department on firstname.lastname@example.org or call 01708 229444. This article was written by Alex Pearce our Employment Law Associate at Pinney Talfourd Solicitors. The contents of this article are for the purposes of general awareness only. They do not purport to constitute legal or professional advice. Specific legal advice should be taken on each individual matter. The law may have changed since this article was published. This article is based on the law as at September 2016.