Employment law in 2016

The New Year is well underway and your 2016 business plans are probably firing on all cylinders.  But did your plans take into account the forthcoming employment law changes due for 2016. 

While this list is not exhaustive, it does give an overview on some of the most significant changes*:


  • Employer NICs abolished for apprentices under the age of 25: From 6 April employers who employ apprentices under the age of 25 will no longer have to pay Class 1 national insurance contributions (NICs) on earnings up to the upper earnings limit.
  • State Pension Regulations 2015: A single-tier, flat-rate will affect people who reach State Pension age from 6th April 2016 onwards who have contributed at least 35 qualifying years of national insurance contributions.
  • Salary requirement for Tier 2 workers: From 6 April UK migrant workers who apply to settle here under the Tier 2 general and sportsperson categories will be required to earn at least £35,000.
  • The National Living Wage: Due to be introduced in April all workers who are at least 25 years old will be entitled to a minimum ‘living wage’ of £7.20 per hour.
  • Small Business, Enterprise and Employment Act: Due to be introduced in April all organisations will be required to maintain and keep open for public inspection a register listing of persons having significant control (PSC). Individuals that are identified as PSCs will be required to provide relevant information to the company.
  • Childcare Bill: From April parents of 3-4 year old children will be entitled to up to 30 hours of free childcare a week as long as one of the parents is employed.
  • Immigration Bill: From April this bill intends to introduce new penalties for illegal workers and employers that knowingly hire illegal workers. In addition, measures will be put into place to bar illegal migrants from accessing housing, driving licences and bank accounts.
  • Compulsory gender pay reporting (2016): All employers, including private companies and voluntary sector organisations, that employ at least 250 individuals—will be required to publish information showing whether or not there are differences in gender pay.
  • Childcare Payments Act 2014 (2016): This new benefit scheme will allow working parents to claim 20 per cent of their childcare costs (up to a maximum of £2,000 per child) annually

Forewarned is forearmed by taking the time to understand what legislation is coming into force and when, you can properly assess the impact it will have on your business and what changes you need to implement. Writing new policies and implementing new procedures can feel like a tiresome task. But when compared with the cost of failing to implement the legislation, it’s time well spent.

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* Zywave Commercial Insurance Pro-file November 2015

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