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2017 employment law changes – what you need to know

The new year brings about changes to employment law that all HR professionals and employers need to be aware of. With the ongoing uncertainty following the Brexit referendum, significant changes to employment law will be rolled out this year.

In 2017 the HR agenda will be dominated by large compliance projects for data protection and gender pay gap reporting. It is likely that employers will see costs increase with the introduction of apprenticeship levy and additional fees for sponsoring foreign workers, as well as tax savings for employee benefits being dramatically reduced.

Here are the 8 employment law changes HR need to prioritise:


  1. Gender pay gap reporting begins

For the first time, organisations with 250 employees or more in the private sector, public sector and voluntary sector will be required to publish gender pay gap information.

Employers will be obliged to release information relating to employee pay and bonus pay, as well as information on the number of men and women in each quartile of the organisation’s pay distribution.

The deadline for the first report is expected to be 4 April 2018, based on pay and bonus data from 2016/17.

  1. General Data Protection Regulation compliance efforts underway

May 2018 is when we will see the EU General Data Protection Regulations (GDPR) come into force, however, this will already be a high priority for employers in 2017 to prepare for the array of changes that will be made under the new Regulation.

Employers will need to conduct audits of employee personal data that they obtain and process to ensure that it meets GDPR conditions for employee consent. Employers will also be obliged to create or amend policies and process on privacy notices, subject access requests and data breach responses. The proposed changes are unlikely to be affected by Brexit as they constitute many human rights characteristics.

  1. Apprenticeship levy on large employers introduced

All employers with an annual payroll of more than £3 million will be required to pay a 0.5% levy on their total pay bill starting on 6 April 2017.

To help fund apprenticeships form, accredited training providers and large employers will be able to access levied amounts, plus a government top-up of 10%.

  1. National minimum wage changes aligned

Cycles for national minimum wage increases, including the national living wage, will be bought together with the next bout of changes taking effect at the beginning of April 2017. The national living wage for staff aged 25 and above will be the next increase, rising to £7.50 per hour.

  1. Changes to rules for employing foreign workers

From April 2017, employers sponsoring foreign workers with a tier 2 visa will be required to pay an immigration skills charge of £1,000 per worker, however, for small employers and charities the charge will only be £364. The immigration skills charge will be in addition to current fees for visa applications.

Also, for ‘experienced workers’ the minimum salary threshold applying for a tier 2 visa will also increase to £30,000. New entrants to the job market, as well as some health and education staff will be exempted from the salary threshold until later in 2019.

  1. Trade union balloting changes to be implemented 

Employers must wait for the new balloting requirements under the Trade Union Act 2016 – date to be announced soon. Under the rules, a successful vote for strike action will require a 50% minimum turnout and a majority vote in favour of industrial action. In important public services, industrial action will require a strike vote of 40% of all eligible voters.

  1. Restraints on public-sector exit payments still expected

It is still anticipated that there will be restrictions on public-sector exit payments, although this was expected to come into force last year. Exit payments could be capped at £95,000 when public-sector employees leave their roles, due to redundancy or voluntary exit. It has also been raised that employees earning over £80,000 will be required to repay exit payments if they return to any public-sector role within 12 months.

  1. Salary-sacrifice schemes significantly restricted

As of 6 April 2017, employers may need to reconsider their benefit offerings as tax savings through most salary-sacrifice schemes will be removed. Schemes in place before April 2017 will be protected until April 2018 and arrangements related to cars, accommodation and school fees will be in force until April 2021. Further schemes related to pension savings (including pensions advice), childcare, cycle-to-work and ultra-lowemission cars will not be affected.

With the significant scope of employment law changes anticipated for 2017, as highlighted above, HR will need to prioritise to ensure the smooth implementation of each rollout is successful. If you need further advice about employment law changes, please contact us today.