April may signal the start of the new tax year but it’s also when a series of new laws will kick in and we wanted to give you a brief overview.
This month a number of announcements that the Chancellor put forward in last year’s budget will take effect, these changes include:
National Minimum Wage
National minimum wage (NMW) rates are scheduled to increase for all pay periods which start on or after 6 April 2019.
It will be important for employers to review and amend their pay practices ahead of time to ensure NMW staff continue to receive the correct rate for their age:
£8.21 25 and over
£7.70 21 – 24
£6.15 18 – 20
£4.35 Under 18
Statutory Sick Pay
Statutory Sick Pay is a legal entitlement that covers all employees, including agency, casual, part time and fixed-term workers – providing you aren’t self-employed.
The qualifying criteria for statutory sick pay (SSP) will change from 6 April 2019, as well as the amount of money employees will be entitled to earn each week.
SSP is currently £92.05 a week for up to 28 weeks – and is paid by the employer in the same way as your normal wages, with tax and national insurance deducted on top.
Individuals will need to earn at least £118 per week in order to qualify for weekly payments of the new amount of £94.25.
Similarly, the rate of pay for maternity, paternity, adoption and shared parental pay will increase to £148.68 per week from the 7 April 2019, which may mean employers have to amend their policies accordingly.
Many employees are currently unsure of how much they’re paying in national insurance, tax and pensions because of a law that doesn’t guarantee them written proof of their pay.
However, the Government has now ruled that from April, statutory new laws will require all employers to:
- Provide payslips to all workers
- Show hours on payslips where the pay varies by the amount of time worked.
Employers will have to rethink their pay slip process from 6 April 2019 as both ‘employees’ and ‘workers’ will be entitled to receive itemised pay statements from this day onwards.
Payslips will also need to include the total number of hours worked, where these influences pay, meaning payroll and HR departments will need to work in unison to ensure relevant staff receive their payslips in accordance with these new requirements.
When auto enrolment was introduced back in 2012, contributions were small at 1%. The idea was to ease people into saving without millions opting out.
Since then they’ve been rising slowly – but this is the biggest jump in contributions by far. Employers are increasing what they’re paying towards your pension to 3% and Employees are being asked to increase their contribution to 5%.
So far, around nine in 10 people who have been automatically enrolled have kept the plan going – but there are concerns this jump in contributions will see people leave in bigger numbers.
For more information on any of these changes, please click on the links below to make sure you are abiding by the new laws.
ACAS – Click Here
Direct Gov NMW – Click Here
Direct Gov SSP – Click Here
The Pensions Regulator – Click Here
Payslips – Click Here