1 April 2021 – NLW/NMW increases
Chancellor Rishi Sunak announced on November 2020 that from April 2021, the National Minimum Wage will rise to £8.91 an hour (an increase of 2.2%) and will be extended to 23 and 24 year olds for the first time (previously the NLW applied only to 25 year olds and older). All other NMW rates will increase at the same time in line with Low Pay Commission recommendations.
For a full breakdown of the rates go to the CIPD’s Statutory Rates page.
4 April 2021 – Gender pay gap reports (private and voluntary sectors)
Private and voluntary sector employers in England, Wales and Scotland with at least 250 employees are required to publish information about the differences in pay and bonuses between men and women in their workforce, based on a ‘snapshot’ date of 5 April each year. Provisions are not yet in force in Northern Ireland.
COVID-19: the government announced a suspension of enforcement measures on gender pay gap reporting for 2019/20, in view of the unprecedented pressures on business caused by the pandemic. Employers have until October 2021 to report their 2020/21 figures before enforcement measures are taken but are encouraged to report by the usual reporting deadlines.
For more information visit the CIPD’s Gender pay gap reporting topic page.
6 April 2021 – Extension of IR35 to the private sector
The IR35 rules prevent contractors who are performing similar roles to employees, and working through Personal Service Companies (PCS), from paying less tax and NICs than if they were permanently employed by the client organisation. In April 2017, responsibility for deciding whether contractors’ working in the public sector were caught by IR35 switched from them to their end users, which also became liable for deducting the right amount of tax and NICs.
From 6 April 2021, deciding whether IR35 applies becomes the responsibility of all private sector employers that in a tax year have:
- more than 50 employees
- an annual turnover over £10.2 million
- a balance sheet worth over £5.1 million.
COVID-19: The extension of the rules to the private sector was due to take effect from 6 April 2020 but was delayed due to the pandemic.
HMRC has published guidance on the new rules, Prepare for changes to the off-payroll working rules (IR35), a statement on the outcome of its consultation, Off-payroll working rules from April 2021 and further guidance in February 2021, saying that it would take a ‘light touch’ to compliance in the first year.
No date – Extending pregnancy protection from redundancy
An employee at risk of redundancy while on maternity, adoption, or shared parental leave has the right to be offered any suitable alternative vacancy that is available.
The government is proposing to extend this protection to:
- pregnant employees, once they have told their employer of their pregnancy
- employees returning from maternity or adoption leave within the previous six months
- parents returning from shared parental leave (although how the limits on this right will operate is still to be worked out).
The proposals are in response to a consultation earlier in the year on pregnancy and maternity discrimination. The government has said that legislation will be brought forward when Parliamentary time allows.
Expected 2023 – Neonatal leave and pay
The Good work plan contained a commitment to introduce extra statutory leave and pay for all parents of premature babies needing specialist care in a neonatal unit. In March 2020, the government confirmed its intention to introduce 12 weeks’ paid leave for parents in this position to avoid them having to choose between returning to work and taking care of their newborn. Announcements prior to the Budget indicated the premature baby leave would be in addition to existing maternity and paternity pay provisions. Although details on how it will work are yet to be released, the leave is expected to be taken after maternity/paternity leave, in blocks of one or more weeks, and paid at the statutory rate for those employees with 26 weeks’ service.
There was also a Budget 2020 commitment to consult on a new ‘in-work entitlement’ for employees with unpaid caring responsibilities, such as for a family member or a dependant.