April Employment Law Update

Important April employment law changes, and why gender pay reporting may just be the start of corporate governance reforms

Statutory Pay Rates

The national living wage for workers aged 25 and over went up to £7.50 an hour on 1 April and the national minimum wage for workers between the ages of 21 and 24 rose to £7.05 an hour. Statutory maternity, paternity, adoption and shared parental pay rose to £140.98 on 2 April.

On 6 April statutory sick pay increased to £89.35 a week, the limit on a week’s pay rose to £113, and the cap on tribunal compensation for unfair dismissal went up to £80,541. Also in force from this date is the new apprenticeship levy, and new IR35 rules governing the taxation of off-payroll workers supplied by intermediary companies to public sector organisations.

This month the government also introduced an immigration skills charge of £1,000 a year per sponsored migrant worker under the Tier 2 (General) category (this applies to organisations with more than 250 employees), and applied an immigration health surcharge to the Tier 2 (intra company transfers) visa for the first time.

Gender pay gap reporting

The gender pay gap reporting rules are now in force, and private and voluntary sector organisations with 250 or more employees should already have taken a ‘snapshot’ of their payroll data on 5 April (31 of March for public sector organisations that meet the threshold) with a view to publishing a report on the gap by 4 April next year (30 March for the public sector).

Corporate governance

Profound changes in the way companies are regulated came a step closer this month with the publication of a report on corporate governance from the select committee of the Business, Energy and Industrial Strategy Department. The report calls for tighter controls on executive pay, greater accountability for remuneration committees, annual reporting of pay ratios, and a target of 50 per cent female appointments to executive management positions by 2020.

A government white paper on proposed reforms is expected later this year.

Case round-up

The Court of Justice of the European Union (CJEU) has reached a decision on two Islamic headscarf cases, Achbita v G4S and Bougnaoui v Metropole.

In Achbita, the CJEU decided that a dress code banning the wearing of the hijab at work, which was aimed at political and religious neutrality, could be justified provided the means of upholding it were appropriate and necessary. In the Bougnaoui case, the court thought that preventing Muslim female employees from wearing a hijab could be legitimate if it was also proportionate.

Lawyers have warned employers from following such a policy in the UK, where case law has tended to favour the rights of Muslim women to dress in accordance with their religion, unless this posed a health and safety risk or actually prevented them doing their job.  

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