As we start the new year, the following is a round up of the key recent changes in employment law for employers, as well as a reminder of important upcoming changes.
UK Minimum Wage to increase in April 2025
Each year, the government sets minimum wage rates based on the recommendations of the Low Pay Commission (LPC), an independent advisory body. The LPC considers factors such as the cost of living, the impact on businesses, and the overall economy when making its recommendations.
The government tasked the LPC with reviewing its wage-setting process to ensure that new rates reflect the rising cost of living. The LPC determined that the 2024 rate of £11.44 fell short of achieving the goal of meeting two-thirds of median earnings, prompting this significant adjustment for 2025.
From April 2025, the national living wage for employees aged 21 and over will increase by 6.7%, rising from £11.44 to £12.21 per hour. This increase is three times higher than the current rate of inflation and reflects the government’s commitment to improving pay for adult workers.
For younger workers, the National Minimum Wage will see substantial raises, with the 18-20 age group rate increasing by 16.3% to £10.00 per hour, and the 16-17 age group and apprentice rates both going up by 18% to £7.55 per hour. The accommodation offset rate, an allowable deduction for employers providing accommodation, will also increase by 6.7% to £10.66 per day.
Changes to Statutory Sick Pay (SSP) in 2025
From April 2025, the weekly rate of Statutory Sick Pay (SSP) will increase from £116.75 to £118.75. This adjustment reflects the annual review of SSP rates to align with changes in living costs.
In a significant change, the earnings qualification criteria for SSP will be removed. This means that all employees, regardless of their pay level, will be eligible to claim SSP if they meet the necessary conditions.
Key changes in 2024
Flexible working
Under the Employment Rights (Flexible Working) Act 2023, employees can now make two rather than one request a year for flexible working, and the deadline for employers to respond to requests has been reduced from three to two months. Employees are able to make such requests from their first day of employment, without having to wait the 26-week qualifying period.
Employers also have to explain the reasons for denying any request, and employees no longer have to explain the impact of their request.
Equality laws
In 2024, changes to the Equality Act and wider equality laws were brought in to strengthen protections against workplace harassment, expand avenues for equal pay and discrimination claims, and provide clearer definitions for key terms such as disability.
Under the Equality Act's revised definition, a disability is now defined as a physical or mental impairment that has a substantial and long-term adverse effect on a person’s ability to carry out normal day-to-day activities. This change clarifies the scope of the law and ensures a broader understanding of disability in legal contexts.
The Act also now allows individuals who do not share a protected characteristic with a disadvantaged group to bring indirect discrimination claims. This change ensures that individuals affected by discriminatory policies or practices, even indirectly, can seek legal recourse for unfair treatment.
As of 26 October 2024, employers are legally required to take reasonable steps to prevent sexual harassment in the workplace. This new duty holds employers accountable, and failure to meet this standard can result in compensation for successful sexual harassment claims being increased by up to 25%. The Equality and Human Rights Commission (EHRC) is empowered to take enforcement action against organisations that do not comply with this requirement.
The scope of comparators in equal pay claims was also broadened. Employees can now compare themselves to a wider range of individuals, including members of the same union, rather than being limited to comparisons within their own organisation. This change makes it easier for employees to establish pay disparities and bring forward claims.
Redundancy Protection for Parents
Employees taking certain types of parental leave now have protection from redundancy for at least 18 months.Pregnant employees now have extended protection from redundancy. The protected period now begins as soon as they inform their employer of their pregnancy and lasts for 18 months. The same protection applies to employees on maternity, adoption or shared parental leave.
Employers who fail to provide appropriate priority protection to employees during the redundancy process risk having the dismissal deemed discriminatory and automatically unfair under employment law.
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