Key Employment law update for 2021

Key Employment law update for 2021

Right to Work in the UK

The Freedom of Movement that allowed EU citizens to live and work in the UK ended on 31 December 2020. EU citizens living in the UK before 31 December 2020 may apply under the EU Settlement Scheme for settled or pre-settled status to continue living and working in the UK. The submission deadline for the scheme is 30 June 2021.

A new immigration points-based system was introduced on 1 January 2021 that requires EU and non-EU citizens to meet a specific set of requirements to live and work in the UK. However, this does not apply when hiring EU citizens or Irish citizens eligible for the EU Settlement Scheme. Employers will need to apply for a ‘sponsor licence’ from the Home office to hire non-UK citizens that are ineligible for the EU Settlement Scheme. This is a significant change for employers recruiting from outside the UK

IR35 to be extended to the private sector  

Reforms to the way IR35 that is intended to identify contractors and companies will be implemented in the private sector on 6 April 2021. The UK tax legislation was previously delayed due to the coronavirus pandemic. The key change is that the end client will be responsible to determine the employment status of contractors.

  1. National living wage and national minimum wage increase

The national living wage (NLW) and national minimum wage (NMW) will increase on 1 April 2021.

For the first time NLW will be extended to the 23 and 24 year olds. The new rates are detailed as follows:

  • 23 years old and over – £8.91 per hour
  • 21 and 22 years old – £8.36 per hour
  • 18 to 20 years old – £6.56 per hour
  • Under 18 years old – £4.62 per hour
  • Apprentice rate – £4.30 per hour

End of the Job Coronavirus Retention Scheme

The Job Coronavirus Retention Scheme was extended until 30 April 30 2021 due to the second wave of the coronavirus pandemic. The government has not announced whether a further extension will be available. 

Gender pay gap reporting resumes 

The Gender Pay Gap Regulations require employers with 250 or more employees to publish data on their gender pay gap each year. The gender pay gap report was suspended in 2020 as a result of the coronavirus pandemic but will resume on this year. The submission deadline for public sector organisations is 31 March 2021 and 4 April 2021 for private companies and charities. 

Job retention bonus scheme 

The Job Retention Bonus is a one-off £1,000 payment to employers, for each furloughed worker who has remained in continuous employment until 31 January 2021. Eligible employers will be able to claim the bonus between 15 February 2021 and 31 March 2021. The bonus is taxable but it does not have to be repaid.  

A member of our team will review the information that has been submitted for approval. You will receive details about our decision very soon. Please contact us if you have any questions. Thank you.

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