It is not too early to start planning for forthcoming changes to the HR landscape that we can expect in 2018 and beyond. Wirehouse look at five of the most pertinent, which includes getting ready for GDPR.
Termination payments
The Finance Bill, due to become law on 6 April 2018, is to introduce a number of changes to the tax treatment of termination payments. Employers should note their new liability for National Insurance Contributions on termination payments exceeding £30,000 that are already liable for income tax. Another change will remove the distinction between contractual and non-contractual notice payments. This will mean that all PILONs are taxable and subject to Class 1 National Insurance Contributions.
Replacement of the Data Protection Directive with the General Data Protection Regulation (GDPR)
On 25 May 2018, the General Data Protection Regulation (2016/679 EU) will replace the existing Directive. The main thrust of the change is the harmonisation of data protection across the EU and, crucially, its extension to all foreign companies that process the personal data of EU residents. Breaches of the Regulation risk a fine of 4% of a business’ global turnover or €20 million, whichever is greater. Special categories of information, which currently include religious belief, political opinion and trade union membership will be extended to cover health information. Brexit is unlikely to put a spoke in this particular wheel for two reasons. First, the UK remains an EU member state and will be until March 2019, if not later. Secondly, the UK Government has already introduced a Data Protection Bill, which will repeal the Data Protection Act 1998 and ensure that the UK’s data protection rules accord with those prescribed by the GDPR. The Information Commissioner has published a document detailing 12 steps employers can take now in order to prepare themselves for the new legislation, and also guidance on what to expect and when in terms of future changes to data protection.
Shared parental leave may be extended to grandparents
Although grandparents are already able to request flexible working arrangements, they currently have no legal right to paid or unpaid leave in order to care for grandchildren. This may be set to change in 2018, following a 2015 Government announcement that shared parental leave may be extended to include grandparents. An expected consultation on the matter has not yet taken place, probably as a result of Parliamentary focus being elsewhere, but employers should not ignore the issue. If, at some point, as seems likely, the shared parental leave system is extended to grandparents, employers can expect a greater number of individuals to be eligible to take up to a maximum of 50 weeks out of work. Businesses employing higher numbers of grandparents are obviously more likely to be affected, and this should be factored into succession planning.
Gender pay gap
2017 was the year in which organisations with 250 or more employees were required to publish their gender pay gap information. The information gathered must include the proportion of men and women who received a bonus, the gender bonus pay gaps, and overall mean and median gender pay gaps during the twelve month period prior to the pay period that includes 5 April 2017. By April 2018, the resulting report must be published on a website that is accessible both to the company’s employees and the general public. It must remain there for three years and must be accompanied by a written statement, signed by a director, vouching for its accuracy.
Parental bereavement
Looking further ahead, to 2020, the Parental Bereavement (Leave and Pay) Bill is expected to become law. It will provide for a minimum of two weeks’ leave for any employee who suffers the loss of a child under the age of 18. Employees with less than 26 weeks’ continuous service will be entitled only to unpaid leave; those with a minimum of 26 weeks’ continuous service will receive pay at a minimum statutory level. It will, of course, be open to an employer to pay the employee’s full contractual rate and to offer a longer period away from work, as many already do in such situations.
