HM Insights

The Shetland blog: what does the law hold for employers this year?

Ewan Stafford is an employment law specialist at Harper Macleod.

It's never an exact science to predict what will happen in the world of employment law, but there are two main themes that we see developments falling into over the rest of this year, the increasing financial squeeze on employers and an increase in rights of the individual.

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Financial squeeze on employers

  • Pensions auto enrolment: on 6 April there will be an increase to minimum auto enrolment pension contributions for both employers and employees. As it stands, the current minimum contribution for both parties is 1% but this will increase to 2% employer contribution and 3% employee contribution in April. There is then a further increase scheduled in 2019 for a 3% employer contribution and 5% employee contribution.
  • Living and minimum wages: alongside this, there will be the usual increase to living and minimum wage rates on 1 April, with the national living wage for workers aged 25 and over to be increased to £7.83 (from the current rate of £7.50).
  • Taxing termination payments: one change to look out for when dealing with Settlement Agreements is the change in April 2018 to the treatment of taxation of termination payments in respect of payments in lieu of notice. All such payments will be subject to income tax and National Insurance deductions, whether contractual or not.
  • Holiday pay: appropriate calculation of holiday pay has been a headache over the past few years, and with recent cases such as the European Court of Justice case of King v Sash Windows, there may be further developments. Although the King case turned very much on its facts, it may offer scope for challenges to settled cases, therefore there is a possibility holiday pay entitlements may need re-calculated.

Increase to individual rights

The second theme we expect to see is an increase to, and enforcement of, individual rights.

  • Data protection: the General Data Protection Regulation (GDPR) will be coming into force in May and will offer increased rights and protection to individuals in respect of their personal data. Combined with these enhanced individual rights, there are robust sanctions for non-compliance. In light of the recent case involving Morrisons supermarket (where an employer was vicariously liable for a disgruntled employee's data breach of personal details of almost 100,000 employees), it is quite possible that we will find individuals (and solicitors) more keen to pursue enforcement of these rights and seek financial recompense for breaches.
  • Tribunal access: lastly, and predictably, given the abolition of the fees regime, there will be many more claims brought in the employment tribunal.

Get in touch

Ewan Stafford is regularly in Shetland. If you would like to speak with him about these or any other employment law and HR matters, please get in touch.

This article originally appeared in the Shetland Times