Employment law changes in 2019

It’s going to be a busy year for employers in 2019 as there are several key employment law changes occurring throughout the year that every employer should be aware of. Ross Pierrepont, a solicitor from Tallents Solicitors in Newark explains how these will affect anyone running a business with employees.

CEO and executive pay gap reporting

From 1st January 2019, regulations made under the Companies Act 2006 will require all UK listed companies with more than 250 UK employees to report annually on the pay gap between their chief executive and their average or ‘ordinary’ worker.

Ross says:

“Although the first set of data isn’t required to be published until 2020, the report will be based on the financial year beginning in 2019, so companies are being urged to give serious thought to this task now.

“There are also several other Pay Gap reporting requirements occurring in 2019 that employers will need to be aware of.”

Gender pay gap reporting

The second set of data on gender pay gap reporting is due no later than 4th April 2019 for companies with at least 250 employees, showing the position as at 5th April 2018.

Ross continues:

“The production of this second set of data is an opportunity for companies to show how they have introduced measures to successfully close any gender pay gap in the last 12 months, or show how they are working actively towards doing so.”

Ethnicity gap reporting

The government is currently undertaking a consultation regarding the possible introduction of mandatory ethnicity pay gap reporting. However, this is in the early stages of consultation and there are many questions still to be answered and issues to be resolved before it could be introduced. Employers should keep in mind that this may possibly be a requirement in the future though.

National Minimum Wage / National Living Wage

On 1st April 2019, the hourly National Minimum Wage (NMW) will increase to £8.21 for those aged 25 and over. Additional increases will apply to the other age brackets bringing their hourly wage up as follows:

  • 21 to 24 - £7.70,
  • 18 to 20 - £6.15,
  • Under 18 - £4.35,
  • Apprentice rate for workers under 19 or in first year of apprenticeship - £3.90.

Ross says:

“This increase to the NMW will apply to all workers falling into these age brackets and will also apply to holiday and auto-enrolment pension calculations too. All employers must ensure they pay these new rates, otherwise they risk a maximum fine of £20,000 per worker.”

Automatic enrolment pensions

From 6th April 2019, employers may be required to increase the amount of their contributions into their automatic enrolment pension.

Prior to April 2018, the auto enrolment total minimum contribution was 2%, with at least 1% being paid by the employer. In April 2018, this minimum increased to 5%, of which at least 2% must be paid by the employer. As of 6th April 2019, the minimum will rise to 8%, of which at least 3% must be paid by the employer.

Ross comments:

“Employers will need be keep on top of these changes and will need to plan their budgets accordingly.  It is also important that employers ensure that they inform their employees of any changes in advance of them being implemented.”

Changes to pay slips

From 6th April 2019, two key changes will affect employee’s pay slip information:

  • Payslips must be given to everyone, employees and ‘workers’.
  • The total number of hours worked where the pay varies according to the hours worked, e.g. under variable hours of zeros hour contracts.

Ross finishes:

“2019 is proving to be a very busy year on the employment law front. As we’ve seen, these are just some of the significant employment law changes occurring this year which employers must comply with.

“At Tallents Solicitors, we understand that this can be a confusing and complicated area of law for employers to stay aware of and remain compliant with. If any employers have concerns regarding the legal and regulatory areas raised in this article or any of the employment law changes occurring in 2019, then our employment law specialists at Tallents can advise and support you.”