We’re merely a few weeks into the new year and already the news pages have been filled with the announcements of changes in legislation that have many businesses scratching their heads.
Unfortunately for start-ups and small companies, law is an overwhelming part of business, and it’s no surprise with the changes that we see year on year.
Only in 2015 we saw a number of dramatic laws being set in place including Shared Parental Leave, Zero Hours exclusivity, and Flexible Working.
As law is ever changing it’s imperative that employers are well educated in any new legislation as it can dramatically impact the way they do business.
There were a large number of changes and legal cases which offered new interpretations on law last year, and this year is set to be no different.
Whilst some are set in stone and others still in draft, if you aren’t familiar with the pending legislation arriving in 2016 we would highly recommend keeping you’re eyes open on these updates.
The government spent 3.5 million on their “I’m in” ad campaign featuring entrepreneurs Karen Brady and Theo Pathitis, encouraging small businesses to act upon the auto-enrolment guidelines.
Part of the Workplace Pension Reforms, it requires every UK business to automatically enrol employees into a workplace pension scheme if the employee earns more than £10,00 for the tax year 2014/2015 and is aged between 22 and the state pension age.
As an incentive for business owners to become legally responsible in helping their staff save for retirement, it’s surprising to find a number of businesses who have still not enrolled despite the April deadline.
It doesn’t matter if you even have one soul employee, you will still need to register them, as failing to enrol will leave you facing fines and penalties that could be costly to your business.
If you don’t know what to do or where to start the Government website has clear guidelines for you to follow.
Regulations are to be introduced this year requiring companies with 250 or more employees to carry out an equal pay review and publish any pay gaps.
Whilst this may not be currently directed at small businesses, the overall prediction is that once rolled out by the large corporations and businesses, start-ups and SME’s will follow closely.
The Equality Act 2010 contains the power for the government to make regulations mandatory surrounding pay gaps, so it’s advisable to begin equal pay procedures as soon as possible.
Proposed penalties for non-compliance with the measures is £5,000 fine, which may be small change to big businesses, but if implemented for small businesses this can be extremely damaging to the financial stability, let alone the reputational damage and negative publicity it may inhibit.
The biggest legal furore in 2016 seems to have already taken place, as the news coverage that Employers are now legally allowed to read private messages sent via Facebook, WhatsApp and iMessenger during working hours, has caused many employers to adjust employees contracts of employment and begin implementing policies and procedures to deter personal messaging on company devices.
Applying to every country that has ratified the European Convention on Human Rights, including Great Britain, employers cannot check personal mobiles but do have the right to check computers and company mobiles.
This is a significant step in more digital business laws, and it’s advisable that employers set clear guidelines to their staff.
National Living Wage
Last year the government announced a new National Living Wage for employees 25 and over. This will come into force in April, and will be set at £7.20 per hour, so small businesses may want to look at their current payroll to ensure that they can meet the legislation.
The governments aim is to raise this new Living Wage to £9 per hour by 2020, however many experts have warned that this could be potentially harmful for start-ups and SME’s.
If you feel that your current pay structure may leave you vulnerable it may be worthwhile to seek financial guidance to ensure you keep meet the expectations required of you.
These laws may overwhelm you, but there are many businesses feeling the same.
Seek guidance as there are many experts who will be able to help you implement these changes without the headache.
By Luke Hutchings, Head of Employment, Taylor Rose TTKW