As well as the annual increases to the National Living Wage and National Minimum Wage (on 1 April) and the rise in statutory maternity pay, paternity pay, shared parental pay and adoption pay, and statutory sick pay (on 6 April), employers need to be aware of a few pieces of new legislation.
The Parental Bereavement Leave and Pay Regulations
The Parental Bereavement Leave Regulations 2020 and the Statutory Parental Bereavement Pay (General) Regulations 2020 have been made. These implement new pay and leave entitlements to bereaved parents in respect of children whose date of death is on or after 6 April 2020.
The regulations give all employees who lose a child under the age of 18, or suffer a stillbirth after 24 weeks of pregnancy, an entitlement to two weeks' statutory leave to be taken in one block or as two separate blocks of a week. Employees with at least 26 weeks' service, and who meet minimum earnings criteria, will also qualify for statutory parental bereavement pay. This will be payable at the same rate as statutory paternity pay.
All termination payments above the £30,000 threshold will be subject to class 1A National Insurance contributions (employer liability only)
From 6 April 2020 employer NICs will be payable on termination payments above £30,000. This was initially scheduled to take place in 2019 but was pushed back to 2020.
All workers have the right to a written statement of terms of employment
The Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018 (the Regulations) provide that a written statement of terms must be given to workers as well as employees, on or before the first day of employment. It will apply to all new joiners on or after 6 April 2020.
An increase to reference period for determining an average week's pay (for the purposes of calculating holiday pay).
The reference period for determining an average week's pay, for the purposes of calculating holiday pay for those working irregular hours, will increase from 12 weeks to 52 weeks under the Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018. This will ensure that workers who do not have a regular working pattern throughout the year are not disadvantaged by having to take their holiday at a quiet time of year when their weekly pay may be lower.
The changes to the holiday pay reference period will apply to periods of holiday from 6 April 2020 onwards.
An amendment to the National Minimum Wage Regulations allowing salaried hours workers to be paid in additional equal instalments.
The amended Regulations will allow salaried hours workers to be paid in additional equal instalments, such as fortnightly or weekly. This will provide employers with additional flexibility in relation to the frequency with which they can make equal payments to salaried workers.
Employers will be able to choose a calculation year for their workers (currently salaried hours workers have their NMW entitlement calculated according to the average monthly hours worked in the "calculation year" which is identified by taking into account the start date of the worker's employment, whether they are paid weekly or monthly, and, if monthly, whether they commenced employment on the first day of the month). By enabling employers to specify a calculation year, and even to specify different calculation years for different workers, the government hopes that employers and workers will be able to monitor the basic hours worked more easily.
Where a calculation year is not specified by the employer then the current provision will remain the default.