April is the busiest time of the year for changes to employment law taking effect. Here is an overview of the major changes that employers need to be aware of.

Gender pay gap reporting

A new law introduced on 6th April will require private sector employers with 250 or more employees to report on their gender pay gap each year. Employers are required to take a data snapshot of their pay data on the 5th April 2017 and report on specific calculations by the 4th April 2018. The report needs to be published on the company’s website and uploaded to a government website.

Similar provisions are being introduced for public sector employers with a snapshot date of the 31st March each year.

Apprenticeship levy

From the 6th April, large employers with an annual paybill of more than £3 million are required to pay an apprenticeship levy. This is set at a value of 0.5% of the total paybill with a £15,000 allowance from the government to offset against the payment.

The levy will be paid in to a digital apprenticeship account on a monthly basis with employers having two years to spend the money on apprentice training.

Increase to minimum pay

On the 1st April, the National Living Wage will increase from £7.20 to £7.50 per hour for workers aged 25 and over. All other National Minimum Wage rates will also increase from the same date to: £7.05 per hour for 21-24 year olds; £5.60 per hour for 18-20 year olds; £4.05 per hour for those over compulsory school age but under 18; and £3.50 per hour for those on the apprentice rate.

Increase to statutory payments

The weekly amount of statutory maternity pay, statutory paternity pay, statutory adoption pay and statutory shared parental pay will increase for the first time in two years from £139.58 to £140.98 from the 2nd April.

In addition, the rate of statutory sick pay will increase from £88.45 to £89.35 per week from the 6th April. The amount an employee has to earn to receive the statutory payments will also increase from £112 to £113 per week.

Tribunal compensation limits 

Employers who are being taken to tribunal from April will see their compensation awards increase as new limits come in to force on the 6th April. From this date, the maximum amount of a week’s pay will increase from £479 to £489 and the maximum basic award for unfair dismissal will increase to £14,670.

The maximum compensatory award for unfair dismissal will also increase from £78,962 to £80,541. This means that the total basic and compensatory award for unfair dismissal has now gone over £95,000 for the first time.

Changes to foreign worker rules

Further to changes made in the autumn of 2016, the Tier 2 minimum salary threshold will be increasing to £30,000 per year although certain roles will remain exempt until July 2019. An Immigration Skills Charge will be introduced to be paid by all Tier 2 sponsors from 6th April.

This will cost £1,000 per year for each Certificate of Sponsorship, with a reduced rate of £364 to be paid by small and charitable sponsors.

Salary sacrifice tax changes

From the 6th April, changes to salary sacrifice tax rules means that income tax and class 1A employer’s national insurance contributions will be paid on the greater of the amount of salary sacrificed or the cash equivalent of the benefit.

These changes do not apply to schemes for employer provided pensions, childcare vouchers, cycle to work schemes and ultra-low emission vehicles.

Alan Price is employment law and HR director of Peninsula.