Increase in National Living Wage and Minimum Wage
Both the National Living Wage (NLW) and National Minimum Wage (NMW) will increase in April 2019. NLW is the minimum hourly rate that workers aged 25 and over are entitled to and that will increase from £7.83 to £8.21. The minimum hourly pay rate for those aged between 21-24 will increase from £7.38 to £7.70 an hour.
The changes will also see an increase in the rate for 18-20 year olds to £6.15 an hour and those over compulsory school age but not yet 18 will see their hourly pay increase to £4.35. The minimum rate for apprentices will also increases to £3.90 an hour (the apprentice must be under the age of 19, or 19 and over but in the first year of their current apprenticeship)
Auto-enrolment Pension Contributions
Currently employers must contribute a minimum of 2% of an eligible worker’s pre-tax salary to their pension with the individual contributing 3%. From April 2019 the minimum contributions for auto-enrolment pension schemes will increase for both employers and employees to 3% and 5% respectively.
From 6th April 2019 the legal right to a payslip will be extended to include those who are recognised as ‘workers’. Employers will also need to include the total number of hours worked on payslips for employees whose wages vary depending on the hours they work.
Gender Pay Gap Reporting and CEO Pay Gap Reporting
Private organisations with 250 or more employees are required to publish their gender pay gap figures on the 4th April 2019. New legislation also comes into force in 2019 that requires companies with more than 250 employees to publish their executive pay gap. Businesses should start calculating their figures in 2019 in readiness for reporting in 2020. Businesses need to report the difference between the amount paid to their CEO and the average pay to their employees.
Settled Status for European Workers
European workers currently living in the UK will be able to apply for settled status in 2019. To be granted settled status individuals must be able to prove they have been living in the UK for 5 years which will allow them to remain in the UK after the end of the Brexit transition period in 2021. Anyone who hasn’t been living here for 5 years can apply for temporary status.