What changes are coming in 2021?
This year there appears to be very few changes in terms of employment law. We do, however, wish to bring these to your attention now in order to give you ample time to make any required changes. We will, as we always do, send you our legislation updates and key facts document towards the end of March.
IR35 rolled out to include the private sector from 06 April 2021
The off-payroll working rules can apply if a worker (sometimes known as a contractor) provides their services through their own limited company or another type of intermediary to the client. Reforms to the IR35 rules on off-payroll working in the private sector have been delayed by a year due to the coronavirus crisis. These changes have been made to reduce tax avoidance for contractors employed via personal service companies.
In short from 06 April 2021, an employer who engages a contractor is responsible for determining the contractor’s employment status and assessing whether or not IR35 applies. If IR35 does apply, the organisation that pays the individual’s fees is deemed to be their employer for tax and national insurance purposes.
It is important that if you do use contractors that you review their contracts, review the service agreements, assess employment statues and put in place the necessary procedures to ensure compliance. For more information on this please click here.
Changes to the National Minimum Wage from 01 April 2021
The National Living Wage will increase by 2.2% from £8.72 to £8.91.
From April 2021, the National Living Wage (NLW) will be the statutory minimum wage for workers aged 23 and over. It currently only applies to workers aged 25 and over.
Different minimum wage rates apply to younger age groups: 21-22 year olds (from 1 April 2021), 18-20 year olds, 16-17 year olds and to apprentices aged under 19 or in the first year of an apprenticeship.
If you would like to know more about how the changes affect your organisation, or need additional help in supporting your staff then advohr is here to help. Email us on firstname.lastname@example.org to start a conversation.