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Employment Law Changes

Employment Law Changes - April 2009

Early April saw a raft of new regulations affecting employment law, employers and employees. The most important of these changes are detailed below:

The new ACAS code applies from 6 April

• What's new?  The revised ACAS Code of Practice replaces the statutory dispute resolution procedures and will become the keystone of disciplinary and grievance matters. The emphasis is on resolving issues in the workplace. The Code is not legally binding and a failure to follow it will not make any dismissal arising out of a disciplinary matter automatically unfair, as was previously the case.
• Actions: Employers should review their existing disciplinary and grievance policies and brief their people managers on the impact of the new regime.
• Be aware: Where there has been an unreasonable failure to follow the Code (by employer or employee), a tribunal can adjust any compensation awarded by up to 25% if it considers it just and equitable to do so in all the circumstances.

Increase in annual statutory holiday entitlement from 1 April

• What's new?  On 1 April, the annual statutory holiday entitlement increased from 4.8 weeks, or 24 days, to a minimum of 5.6 weeks or, for a full-time worker, 28 days - public holidays may be included.
• Actions: Employers who currently offer fewer than 28 days holiday per year, including public holidays, need to increase employee holiday entitlement or risk employment tribunal claims. For employers whose holiday year does not run 31 March-1 April, an online calculator is available at businesslink.gov.uk to assist calculating pro-rata entitlement.
• Be aware: The 28 days statutory holiday entitlement may not be replaced by a payment in lieu, except on termination. Employers need to consider, in particular, the holiday entitlement of part-time workers who may not work on public holidays.

Increases to statutory maternity, paternity and adoption pay from 5 April

• What's new?  The prescribed weekly rates of statutory maternity pay, (SMP), statutory paternity pay (SPP), and statutory adoption pay (SAP) will be increased with effect from 5 April. The prescribed weekly rate of SMP, SPP and SAP will be £123.06 (up from £117.18).
• Actions: Ensure the new rates are paid as appropriate.
• Be Aware:  Failure to pay the appropriate rates may result in employment tribunal claims. 

Increased penalties for failure to pay the national minimum wage (NMW) apply from 6 April

• What's new?  Where employers have failed to pay the NMW, they will face a penalty of 50% of the amount of the underpayment, which may be enforced by HMRC, which also gains powers to remove wage records for inspection, and to use search and seize powers when investigating criminal offences relating to the NMW.
• Actions: Employers should ensure that the NMW is paid to all qualifying employees, and that no deductions are made that could take the worker's average pay below the NMW. Employers should also ensure that accurate records are kept.
• Be Aware: Even though there are only a limited number of NMW compliance officers at HMRC, employers should note that individual employees may still enforce the NMW themselves, by claiming in a court or employment tribunal.

Rises in Statutory Sick Pay (SSP) from 6 April

• What's new?  SSP rises to £79.15 per week.
• Actions: Employers who operate a non-contractual sick pay scheme will need to amend their records and any commercial payroll software to reflect this change. In addition, written policies that detail the level of SSP payable will also need to be updated.
• Be Aware: To avoid any HMRC trouble, make sure to pay the amended rate with immediate effect and to record this in all tax documentation. Otherwise, your ability to reclaim SSP under the Percentage Threshold Scheme could be affected.