Employment Law – 5 changes you need to know about in April 2021

April is always a busy month for employment law – we highlight the key changes taking place this month that employers will need to take note of:

1 April: National Living Wage/National Minimum Wage

The new rates will come in from 1 April 2021 and will see a drop in age at which employees become entitled to the National Living Wage from 25 to 23 years. The new rates will be:

  • NLW will increase from £8.72 per hour to £8.91 per hour (for those aged 23 and over)
  • NMW 21 to 22 year old rate will increase to £8.36 per hour
  • NMW 18 to 20 year old rate will increase to £6.56 per hour
  • NMW 16 to 17 year old rate will increase to £4.62 per hour
  • NMW apprentice rate for those aged under 19 or in their first year of an apprenticeship will increase to £4.30 per hour

4 April: Statutory Benefits

 From 4 April 2021 rates of Statutory Maternity Pay, Statutory Paternity Pay, Statutory Adoption Pay, Statutory Shared Parental Pay and Statutory Parental Bereavement Pay will increase to from £151.20 to £151.97 (or 90% of an employee’s average weekly earnings, whichever is lower).

Statutory Sick Pay (SSP) also increases from £95.85 to £96.35 per week.

4 April: Gender Pay Gap Reporting

 Each year, employers with 250 or more employees are legally required to report on the difference in earnings between men and women. This exercise helps organisations to understand the size and causes of pay disparity and provides HR with insight it can use to identify strategies which will narrow the gap.

Most public authority employers were originally expected to publish their gender pay gap information by 30 March 2021, and private, voluntary, and all other public authority employers by 4 April 2021. However, due to the ongoing complications caused by coronavirus, employers have been given a six-month reprieve, with the deadline now extended until 5 October for all employers.

6 April: IR35

 Changes to the IR35 in the private sector – also delayed by 12 months as a consequence of Covid-19 – will come into force on 6 April 2021.

This ‘anti-avoidance tax legislation’ is designed to ensure those who are employed in all but name are taxed at a rate similar to employed individuals. This will effectively shift the burden onto employers to prove that workers are in fact self-employed.

30 April: Coronavirus Job Retention Scheme

 The Coronavirus Job Retention Scheme was due to close on 30 April 2021, but the Spring Budget on 3 March confirmed that it has been extended until 30 September 2021, and the level of grant available to employers under the scheme will stay the same until 30 June 2021.

From 1 July 2021 the level of grant will be reduced, and the employer will be required to contribute 10% to wages for unworked hours and in August and September that contribution increases to 20%. The employer remains responsible for the full costs of wages for worked hours.

For more advice on any of the issues mentioned in this article, contact our Employment Team on 01603 677077.