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April 2016 employment law changes
There are several key changes to employment law coming into force in April 2016, including the following:
National Living Wage. The National Minimum Wage (Amendment) Regulations 2016 (SI 2016/68) will come into force on 1 April 2016. The new National Living Wage will apply to workers aged 25 and over at a rate of £7.20 an hour.
Financial penalties for unpaid tribunal awards and settlements. The Small Business, Enterprise and Employment Act 2015 (Commencement No 4) Regulations 2016 (SI 2016/321) will come into force on 6 April 2016. The regulations introduce a new scheme for penalising employers who fail to pay tribunal awards or settlement sums payable under an ACAS COT3 settlement agreement.
Abolition of contracting-out on a salary related basis. On 6 April 2016, the government National Insurance Contribution rebates for contracting out of the Additional State Pension will be removed and employers and employees will have to contribute in full.
Tribunal compensation limits. The Employment Rights (Increase of Limits) Order 2016 (SI 2016/268) will come into force on 6 April 2016. The maximum compensatory award for unfair dismissal will rise from £78,335 to £78,962. The maximum amount of a week's pay, used to calculate statutory redundancy payments and various awards including the basic and additional awards for unfair dismissal, also rises from £475 to £479.