All change in April 2018….

Increases in compensation limits

From 6 April 2018, compensation limits and minimum awards that are payable under various employment legislation will increase as follows:

• The maximum compensatory award for unfair dismissal will rise from £80,541 to £83,682.
  
  
• The limit on a week's pay for the purposes of calculating (among other things) statutory redundancy payments and the basic award for unfair dismissal will increase from £489 to £508.
  
  
• Guarantee pay will increase from £27 to £28 per day.
  
  
• The minimum basic award in cases where a dismissal is unfair by virtue of health and safety, employee representative, trade union, or occupational pension trustee reasons will increase from £5,970 to £6,203.

Remember that these new rates will apply where the “appropriate date” for the particular claim (for example, the termination date in an unfair dismissal claim) falls on or after 6 April 2018. If the appropriate date is before 6 April 2018, the old limits will still apply, regardless of the date on which compensation is awarded.

Increases to National Living Wage and National Minimum Wage

From April, the rates will increase as follows:

• Age 25 and over - £7.83
• Age 21 to 24 - £7.38
• Age 18 to 20 - £5.90
• Under 18 - £4.20
• Apprentice - £3.70

New rules on employment allowance for employers hiring illegal workers expected

Between November 2016 and January 2017, HMRC consulted about draft regulations designed to exclude employers who are penalised for employing illegal workers from the NICs employment allowance. The new rules (announced in the 2016 budget) will impose a one-year loss of NICs employment allowance on employers that have received a civil penalty for employing illegal workers. The new rules are expected to take effect from April 2018.

Gender pay gap reporting: private and voluntary sector reports due

Large private and voluntary sector employers (namely, those with 250 or more employees on 5 April 2017) must publish their first gender pay gap report by 4 April 2018.

Childcare voucher scheme closed to new entrants from April 2018

The current childcare voucher scheme will be closed to new entrants from April 2018.

Salary sacrifice - end of transitional arrangements

Since April 2017, the only benefits that have continued to benefit from tax and NICs relief if provided through a salary sacrifice arrangement have been enhanced employer pension contributions, childcare benefits, cycle to work and ultra-low emission car benefits.

Other salary sacrifice arrangements entered into before April 2017 were protected under transitional arrangements. These expire on 5 April 2018, save for salary sacrifice arrangements for cars, accommodation and school fees, which will continue to be protected until 6 April 2021.

These notes have been prepared for the purpose of articles only. They should not be regarded as a substitute for taking legal advice.