Bills & proposals
Upcoming changes to be aware of
Consultation concludes on 9th October
HMRC has launched a new consultation as it seeks views on some draft regulations in relation to salary advances. There are two draft amendments proposed: one for income tax and the other for National Insurance.
As it stands, salary advances need to be reported to HMRC via RTI when they are processed and then the usual contractual payments also reported. The proposed amendments would change this requirement meaning only the contractual, main payment would need to be reported in full.
The aim of these amendments is to reduce administrative burden, reduce the number of RTI submissions needed and assisting with HMRC processes such as PAYE coding and universal credit errors.
Effective by January 2024
The Government has confirmed that it will be reinstating equal pay protection legislation after a raft of EU law is repealed at the end of 2023.
Under the Retained EU Law (Revocation and Reform) Act 2023, which received Royal Assent in June, these protections would have been removed.
These EU-derived protections close the gap further from UK equality law, which states that men and women must be paid the same unless any disparities can be justified. However, an EU provision known as the single source test, which helps lower-paid women take action against their employer over pay, will be replicated in our domestic legal framework.
Under the Equality Act 2010, a claimant and comparator must be employed by the same employer or associated employers, either at the same site or elsewhere if the same contract terms apply.
EU legislation, meanwhile, is more expansive. Article 157 of the Treaty on the Functioning of the European Union (TFEU) allows comparisons to be made without the necessity of claimant and comparator to be employed by the same employer or even associated employers
Effective 24 July 2023
The Protection from Redundancy (Pregnancy and Family Leave) Act extends the previous period of protection against redundancy for pregnant workers to six months following their return to work.
Under the current law, those on maternity leave, shared parental leave or adoption leave have special protection in a redundancy situation for the duration of their pregnancy only. They have the right to be offered a suitable alternative vacancy, if one is available, before being made redundant. This gives employees on these types of leave priority access to redeployment opportunities over other redundant employees.
The Protection from Redundancy (Pregnancy and Family Leave) Act 2023 extends the priority status to pregnant employees and those who have recently returned from maternity leave and shared parental leave.
Who will be protected?
In addition to those on maternity leave, the Act extends protection to:
A pregnant employee who is in “a protected period of pregnancy”
An employee who has recently suffered a miscarriage
Maternity returners
Adoption leave returners
Shared parental leave returners
Draft legislation was announced on 19 July for changes to HMRC data collection.
This measure will require employers to provide more detailed information on employee hours worked via Real Time Information PAYE reporting. Secondly, shareholders in owner-managed businesses will be required to provide the amount of dividend income received from their own companies separately to other dividend income, and the percentage share they hold in their own companies via their Self-Assessment return. Finally, the self-employed will be required to provide information on start and end dates of self-employment via their Self-Assessment return.
The measure will have effect from no earlier than the start of the tax year 2025 to 2026.
A bill which would extend auto-enrolment to those aged 18 and over has been delayed until after parliamentary recess in September.
The auto-enrolment bill passed its second reading in the House of Lords on 14 July.
It permits two extensions to automatic enrolment – abolishing the Lower Earnings Limit (LEL) for contributions and reducing the age for being automatically enrolled to 18 years old.
The Bill was debated in parliament on 14 July and Baroness Altmann expressed that the measures could benefit 600,000 18 to 21-year-olds working in the private sector, saying:
‘‘The Bill provides regulation-making powers to amend the automatic enrolment framework set out in the Pensions Act 2008. The Secretary of State for Work and Pensions will be required to carry out a public consultation on the proposed use of these powers to lower the minimum age and abolish the lower earnings limit, with the findings having to be reported to Parliament before regulations are made. It is promised, I believe, that the consultation will be later this year, so I do not think that we will have to wait too long. All noble Lords will therefore be able to consider and vote on the detail of the proposals for secondary legislation before they become law. I hope that noble Lords will therefore be able to support these enabling measures in the Bill today.
"As the Government have promised, this measure will be in place—or the intention is that it will be in place—by the mid-2020s. Of course, there is more to do, including extending auto-enrolment to workers with earnings in any one job below £10,000 as well, but that can be covered elsewhere, and to the self-employed. However, these measures are an important start. I welcome the improvements, and I hope that noble Lords across the House will do so. I commend the Bill to noble Lords.’’
A date is yet to be announced for the committee stage, which is a line-by-line consideration of the detail of the bill.
