April, famous for showers, pranks… and employment law changes

Fortunately 2021’s April employment law update is far more routine than last April’s furlough and Covid madness, for which I am very grateful. 

So, what do you need to know? By date:

1 April 2021

Shielding officially ends. 

A huge relief for some, and the source of considerable anxiety for others. Those previously shielding should work from home if they can and otherwise can now return to the office. Employers need to work with these employees and workers to ensure the workplace is Covid secure and to support their mental health during what may be a tricky transition. Note that employers can still allow these employees to remain on furlough if they agree.

National Minimum Wage rises – AND THE AGE BANDINGS CHANGE

The national living wage (highest NMW band) increases to £8.91 per hour. This will now apply to 23 and 24 year olds, previously it only applied to those 25 and over. Don’t be caught out by this!

Other NMW rate rises are £8.36 for workers aged 21 and 22,  £6.56 for workers aged 18 to 20 and  £4.62 for workers aged 16 and 17.

4 April 2021

The weekly rate of statutory maternity, paternity, adoption, shared parental and parental bereavement pay increases to £151.97.

Public sector bodies and private sector employers would have been required to submit their gender pay gap reports by 30 March and 4 April respectively. However the Equality and Human Rights Commission (EHRC) has confirmed that gender pay gap enforcement action for the reporting year 2020-21 will be suspended until 5 October 2021.

 6 April 2021

IR35/OFF Payroll Working – the big change for many

The new off payroll working rules for private sector organisations take effect on 6 April 2021, delayed from last year. Designed to counter non-compliance with IR35, the rules on off -payroll working in the private sector will come into effect from 6 April 2021 and contractors and medium and large sized organisations who engage them need to be aware of this.

The measures shift the compliance burden from the worker’s personal service company to the medium and large “client” organisations that they work for, by treating the client organisation as an employer for income tax and NICs purposes. This means greater analysis of the contract before it commences and various other obligations, including checking status for tax before the engagement starts and sharing that status determination with others in the ‘employing’ chain.

Rate rises:

  1. Rate rises for dismissals on or after 6 April 2021:
  • Statutory Sick pay rises to £96.35 per week
  • A week’s pay for redundancy is capped at £544
  • The unfair dismissal compensatory award rises to the lower of one year’s gross pay or £89,493

2. For cases presented on or after 6 April 2021 the Vento bandings for compensation discrimination cases increase as follows:

  • £900 to £9,100 (lower band) for less serious cases;
  • £9,100 to £27,400 (middle band) for cases that do not merit an award in the upper band;
  • 27,400 to £45,600  (upper band) for the most serious cases,
  • with the most exceptional cases capable of exceeding £45,600.

Three significant cases:

Finally, judgments in three significant and long awaited cases were handed down in the last month or so, of which those in HR should be aware:

  1. Uber – After a full analysis the Supreme Court has determined that Uber drivers in the UK are workers, not self-employed contractors, giving them the rights to the national minimum wage, sick pay and paid holidays, amongst other rights. This throws further light on the confusing issue of employment status in the gig economy which is likely to rumble on for decades. Only this morning it has been reported that Deliveroo’s shares have plummeted after a number of major UK investors expressed concerns about its gig economy worker model (Deliveroo’s drivers are engaged as self-employed contractors).
  2. Asda – In a class action on behalf of 35,000 claimants, the Supreme Court has held that lower paid shop staff, who are mostly female, can compare themselves with higher paid workers in the distribution depots, who are mainly male, for the purposes of equal pay claims. The employment tribunal had found that the distribution employees would have been employed on substantially the same terms if they had been employed at the claimants’ site. Despite having overcome this preliminary hurdle, the claimants must still go on to show that they performed work of equal value to win their claims. Asda have indicated that they would defend such claims on the basis retail and distribution are very different sectors with their own distinct skill sets and pay rates. The potentially huge costs and implications of this case (the BBC suggested £8bn collectively if ASDA and similar retailers were to lose such claims) highlight the need for larger organisations in particular to carry out job evaluation scheme which can can assist an employer achieve a non-discriminatory pay system throughout its workforce .
  3. Mencap – A significant case regarding carers who are required to ‘sleep in’. Here the carer’s sleep-in shift lasted nine hours, for which Mencap paid a flat rate of £29.05. The carer had her own room and could sleep during the shift, but was required to keep “a listening ear” during the night and provide support or respond to emergencies where needed. The lower courts had found that the carer had been working throughout her sleep-in shift and should have been entitled to the national minimum wage for the entire shift. However, the Court of Appeal ruled that she was only entitled to the national minimum wage when she was actually carrying out her duties – such as helping a patient or doing other work – and not when she was sleeping or resting. The cost implications of this case for the care sector are huge.

Please do contact me or any of the @DraperLangLLP team if you would like any further information about any of these points, or employment law generally. Happy Easter!