The spring is the bearer of brighter weather, but of course we all know it also means a raft of new legislation is introduced that has us all doing a spring clean of our employment policies and procedures.
This year sees possibly one of the most far-reaching and complex regulation changes to date: shared parental leave and pay rules which offer greater flexibility for parents in how they share the care of their child during its first year. There are also changes to adoption leave and pay, extended rights for parents to take unpaid parental leave, new rates of various types of statutory pay, changes to employer National Insurance contributions and limits on tribunal awards will be introduced.
Here we take a brief look at each of the changes coming in this month. For further information or advice you should speak either to your bookkeepers or legal or HR advisers.
Shared Parental Leave and Pay
We wrote about this in detail at the beginning of this year and you can refresh your memory of the new laws and how to prepare for them here: Get Ready for the New Shared Parental Leave and Pay Rules. In a nutshell, The Shared Parental Leave Regulations 2014 permit employees to share up to a year’s leave between mother and father. It is available to couples with a baby due or placed for adoption on or after 5 April 2015. Mothers are still entitled to 52 weeks’ maternity leave and 39 weeks’ statutory maternity pay and fathers still have their two weeks’ ordinary paternity leave and pay. However, parents will now be able to share the mother’s maternity leave and pay as she will have the right to end her maternity leave and pay early and share the untaken balance with the father.
Adoption Leave and Pay
The Paternity and Adoption Leave (Amendment) Regulations 2014 come into force on 5 April 2015, bringing in significant changes to adoption leave. These include statutory adoption pay coming into line with statutory maternity pay at 90% of average weekly earnings for the first size weeks. New rights will apply for local authority foster parents who are intending to adopt. There is new protection for employees against discrimination or dismissal due to taking time off for adoption appointments. And parents who have a child through a surrogacy arrangement will also become eligible for adoption leave. These are just a few of the new rules under the banner of adoption leave and pay.
Unpaid Parental Leave
Parents of children under the age of 5, or 18 if the child is disabled, currently have the right to take unpaid parental leave. However, as of 5 April 2015, this right is extended to all parents with children under the age of 18.
New Rates of Statutory Pay
Statutory maternity, paternity pay and adoption pay increases from £138.18 per week to £139.58 per week from 5 April 2015. Statutory shared parental pay will also be set at the same rate of £139.58 per week. From 6 April 2015, the standard rate of statutory sick pay will rise from £87.55 per week to £88.45 per week.
National Insurance Contributions
In an aim to encourage the employment of younger people, from 6 April 2015, the Government is abolishing National Insurance contributions for employees under the age of 21 whose earnings stay below the upper earnings limit.
Tribunal Awards & Statutory Payments
The maximum award for unfair dismissal compensation will rise from £76,574 to £78,335 as of 6 April 2015. When calculating statutory redundancy pay and other awards, for example for unfair dismissal, the maximum amount of a week’s pay will increase from £464 to £475.
Now is the time to update your policies and procedures, and also to talk to your bookkeepers about any effects the new regulations will have on your cashflow and bottom line.