What's in store for employment law in 2016?

13 January 2016

Katie Davies, partner and employment law expert, takes a look at the employment law changes planned for 2016 and their likely impact on business.

As always, a new year heralds a raft of new and revised employment law legislation. The key changes are summarised below, and will provide you with a good overview of what to expect.

Whistleblowing provisions
Under The Small Business, Enterprise and Employment Act 2015 (SBEE) from 1 January 2016 there are new provisions requiring prescribed persons to report annually on whistleblowing disclosures.

Public section payments
The SBEE also permits the government to require the repayment of certain public sector exit payments and from 1 April 2016 employees in the public sector with annual earnings of £100k plus will be required to repay exit payments where they return to work in the public sector within one year of leaving.

Exclusivity Terms in Zero Hours
In addition to exclusivity clauses in zero hours contracts now being unenforceable, on 11 January new regulations came into effect which provide a remedy to zero hours workers. These regulations make provision in relation to the right for eligible individuals on zero hours contracts not to be unfairly dismissed or subjected to a detriment because they have breached a provision of the contract which prohibits them from doing any other work.

In practice, these regulations mean that a worker will be entitled to bring a claim for detriment, and an employee will be entitled to bring a claim for automatic unfair dismissal, where the reason for the detriment or dismissal is that the worker or employee has breached an unenforceable exclusivity term in a zero hours contract i.e. worked somewhere else.

Family friendly rates and sick pay
Rates for these will be frozen and will not increase in 2016. These include statutory maternity pay, statutory paternity pay, statutory adoption pay and statutory parental leave.

National Living Wage
These regulations come into effect on 1 April 2016. Firstly, they amend the provisions dealing with financial penalties for failing to comply with the national minimum wage. The amendment increases the percentage figure from 100% to 200% of the underpayment in relation to pay reference periods which begin on or after 1 April 2016. Secondly, and more importantly, they introduce the new national living wage rate of £7.20 per hour for adult workers aged 25 and over.

Employer’s National Insurance Contributions (NIC) for apprentices
From 6 April 2016, employers' NICs for apprentices under the age of 25 has been abolished.

Directors
From October 2016 companies will be banned from having corporate directors. As such, from this date, all directors must be natural persons.

Watch out for...

  • A £95k cap on exit payments to public sector employees is also to be introduced, but as yet there is no implementation date, and
  • New grandparental leave (similar to shared parental leave) to be introduced in 2018

Naturally, if you're unsure about any element of employment law legislation we recommend that you seek professional legal advice. Simply contact any of our employment law experts, and they will be happy to help.


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