Changes in 2021 employment law you should be aware of

Authored by ARAG

Whilst we don’t really know what the rest of the year has in mind for us, we can certainly point you in the direction of the changes within employment law 2021 that we do know about.

What is the latest on the Coronavirus Job Retention Scheme?

The Coronavirus Job Retention Scheme (CJRS) has now been extended. The CJRS (also known as the furlough scheme) has been extended until 30 September 2021 and the level of grant available to employers under the scheme will stay the same until 30 June 2021. If the vaccine rollout goes according to plan, the Government will be under significant pressure to end the CJRS. It’s been suggested that support will begin to be phased out from 1 July 2021.

What about the off-payroll working rules (IR35)?

The off-payroll working rules (IR35) will be extended to large and medium-sized companies in the private sector, effective 6 April 2021. Businesses will be obliged to determine the employment status of individuals with whom they engage. HMRC released an updated version of their online checking tool (known as ‘CEST’) and businesses are encouraged to use this to obtain a determination.

Is there a change to the National Minimum Wage?

Many workers will receive a pay increase from April 2021 following a rise in the highest level National Minimum Wage (NMW) to £8.91 per hour. Eligibility for the National Living Wage has also been increased as more young people will qualify with as those aged 24 and 25 to 23 now being entitled to receive it.

Other national minimum wage rates also increased, with hourly rates rising to £8.36 for workers aged 21 and 22, to £6.56 for workers aged 18 to 20 and to £4.62 for workers aged 16 and 17.

What happens if you are made redundant?

If you are made redundant on or after 6 April 2021, your weekly pay for the purposes of redundancy calculations will be capped at £544. and the maximum statutory redundancy compensation you can receive is £16,140, excluding notice pay.

Any payment calculations will be based on your actual salary not any lesser sums you may have been receiving as a result of being furloughed.

Is there an increase in Family Related Payments?

If you are off work for a family absence, maternity, paternity, adoption or shared parental leave the statutory payment for these absences has increased to £151.97 with effect from 4th April.

Is there a change to Statutory Sick Pay (SSP)?

If you are absent from work due to illness, and qualify for SSP, this will be increasing to £96.35 a week with effect from 6th April.