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Autumn Statement - November 2016

Autumn Statement November 2016 – Changes to Employment Law

The Chancellor’s Autumn Statement on 23rd November included some important changes to Employment Law.

National Living Wage & National Minimum Wage Rises

From 1st April 2017 the National Living Wage for all workers aged 25 or over will rise to £7.50 per hour.

From the same date, the National Minimum Wage for other workers will be increased as follows:-

  • £7.05 per hour for 21 to 24 year olds

  • £5.60 per hour for 18 to 20 year olds

  • £4.05 per hour for 16 to 17 year olds

  • £3.50 per  hour for apprentices

The government has also announced that it will be putting more resources into Minimum Wage enforcement. Employers who pay under the Minimum Wage can face a penalty of up to £20,000.00 per worker.

Restriction of Employee Salary Sacrifice Schemes

From April 2017 the Income Tax and National Insurance advantages of employees’ salary sacrifice Schemes will be restricted to: child care benefits; cycles and cyclists’ safety equipment; ultra-low emission cars and enhanced employer pension contributions to registered pension schemes.

Termination Payments

The exemption from Income Tax and National Insurance contributions for Termination Payments up to £30,000.00 will remain in place. However, from April 2018 employer National Insurance contributions will be payable on termination payments above £30,000.00.

Alex Green

Head of Employment Law

[email protected]

Written By: Alex Green

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