April 2020 – Key Employment Law Changes
Many employers will have spent recent weeks grappling with the new concept of “furlough leave” or attempting to manage the economic impact that the outbreak of COVID-19 has had on their businesses.
It is therefore understandable that many may have overlooked several other key employment law changes that have come into effect this month. I summarise the key changes below.
- Increase to national minimum wage From 1 April 2020 the following increases to national minimum wage rates came into effect:
- for workers aged 25 – from £8.21 to £8.72 per hour
- for workers aged 21 to 24 – from £7.70 to £8.20 per hour
- for workers aged 18-20 – from £6.15 to £6.45 per hour
- for workers aged 16-27 – from £4.35 to £4.55 per hour
- New compensation limits
New compensation limits come into force from 6 April 2020. The figures apply to dismissals where the effective date of termination is on or after 6 April 2020. There will be an increase to the limit on:
The maximum basic award will increase from £15,750 to £16,140
The maximum compensatory award will increase from £86,444 to £88,519
A week’s pay calculation
A week’s pay for the purposes of calculating statutory redundancy payments and the basic award for unfair dismissal will increase from £525 to £538
With effect from 6 April 2020:
The statutory sick pay weekly rate increases from £94.25 to £95.85
Statutory maternity, adoption, paternity and shared parental pay will increase from £148.68 to £151.20
- Changes to written statements of terms and conditions
From 6 April 2020, the requirement to provide a written statement of terms and conditions extends to workers and not just employees. There is no longer a minimum length of service requirement and therefore all workers are entitled to a statement on their first day of work.
In addition there are changes to the information that must be contained in the written statement. See my previous blog for more details.
- A new right to parental bereavement leave and pay
From 6 April 2020 bereaved parents of a child who dies on or after 6 April 2020 have a new right to take up to two weeks’ parental bereavement leave with pay at the statutory minimum rate. This right will also apply to those parents who suffer a still birth occurring after 24 weeks of pregnancy.
Employers should review their policies to ensure that they include time off for bereaved parents.
- Holiday pay calculations for those with irregular hours
On 6 April 2020 the holiday pay reference period for those individuals who do not have normal working hours or who receive variable remuneration increases from 12 weeks to 52 weeks.
Employers will need to adjust how they calculate holiday pay and may need to update their holiday policy if it refers to the holiday pay reference period.
- Agency workers – equal pay
From 6 April 2020 employers must ensure that any agency workers, who have at least 12 weeks’ continuous service, are paid the same amount as any direct employee.
Finally there are a couple of other consequences of the outbreak of COVID-19:
- Changes to the off-payroll working (IR35) rules which were due to come into effect on 6 April 2020 have been delayed until April 2021.
- The government announced that it was suspending enforcement of gender pay gap reporting requirements this year; however those organisations who have all of their data ready are urged to publish their reports once the coronavirus outbreak has passed.