Employment law crib sheet

As the summer holiday season draws to a close, the inevitable back-to-school feeling grips even the biggest kids among us as we prepare to get back to work and buckle down to business.

As small businesses owners start to get back up to speed after what is traditionally a quiet time for most businesses, one important area to catch up on is the planned changes to employment rules and regulations, many of which comes in at the start of October. This might tend to be at the bottom of your priorities, but failing to get up to speed with any changes could prove costly.

Below is a guide to the key changes that you should be aware of in the next few weeks and what should be on your radar for the coming months.

Summary of the key regulation changes for the second half of 2014

National minimum wage changes (October 2014)

From 1st October, the national minimum wage rates go up.

The new rates are:

  • Aged 21 and over – increase from £6.31 to £6.50 per hour
  • Aged 18 to 20 – increase from £5.03 to £5.13 per hour
  • Aged 16 to 17 – increase from £3.72 to £3.79 per hour
  • Apprenticeship rate – increase from £2.68 to £2.73 per hour.

Remember that the government has raised the penalties for non-payment with a £20,000 penalty in place for businesses that don’t pay the correct rates and the embarrassment of being publicly named and shamed!

Shared parental leave and antenatal appointments from October

The big change coming in from October is the right to shared parental leave following the birth of a child on or after 1st April 2015. From October, fathers will also have the right to take unpaid leave to attend two antenatal appointments.

Commission during holiday
One potential law change that has been making its way in through the European Court of Justice (ECJ) means that you will have to include average commission payments in an employee’s holiday pay.

This case involved an employee whose salary was part basic and part commission but his holiday leave entitlement was calculated only on his basic salary.

The ECJ found that not including commission when calculating holiday pay could deter the employee from actually taking annual leave, which goes against the objective of the Working Time Directive.

This is now back with the Employment Tribunal to determine how the Working Time Regulations should be determined following this decision. Whilst the final outcome is still in the balance it does seem likely that employees who earn additional amounts through overtime and commission will have to have their holiday pay averaged out.

Employers may therefore review their annual leave arrangements to ensure that commission or other relevant variable payments are factored into holiday pay calculations. You may also want to look at existing pay structures, contracts and commission policies to consider if these need reviewing in light of recent developments.

Sickness and absence – advice service

The government announced the launch a new Health and Work Service with the aim of getting employees on long-term sickness back to their jobs. This followed the recommendations of a task force assigned to look at ways to tackle the issue. The agency will launch in autumn but will be fully operational by April 2015.

Another recommendation that the government has introduced from this year is the scrapping of the Percentage Threshold Scheme. This was quietly removed from April this year and previously allowed employers to claim back a percentage of SSP for employees on long term sick leave. The deadline for any PTS claims for the 2013/14 financial year is 1st April 2016.

Things to keep on your radar

• Pensions
You may be sick of hearing about it, but the pensions auto enrolment wagon just keeps rolling on, with less than 12-months to go for businesses with 30-49 employees. So if you’ve not already, you need to find out your staging date and what to do next.

• Flexible working
During the summer, changes came in that mean all employees now have the right to make flexible working requests. If you are not up to speed already it is worth making sure that you know how to handle such requests and in what timescales.

• Food labelling regulations

If you run a business that prepares and serves food, you need to be aware of new allergen labelling laws coming in from December.

Remember that it is a good idea to seek advice ahead of taking any action. As well as providing regular updates, the Forum’s business advice team can give advice on all employment-related issues. For further information visit www.fpb.org or call 0845 130 1722.

Image: Employment via Shutterstock

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