What changes will affect your organisation in the coming year? Martin Hamilton reports
Public Sector Exit Payment Regulations
A new cap of £95,000 on public sector exit payments is expected to be introduced on 1 April 2017, under the Public Sector Exit Payment Regulations.
The government has also published a public sector exit payment framework that limits exit payments further. The limitations are:
Maximum tariff of three weeks’ pay per year of service
Maximum 15 months’ salary
Maximum £80,000 salary on which exit payments can be based
Tapering of lump sum approaching retirement
Action to limit or end employer-funded early access to pension as an exit term
We expect further guidance on the framework to be issued by the government in due course.
Repayment of Public Sector Exit Payments Regulations
These regulations require the recovery of exit payments made to public sector employees where the employee earns £80,000 or more and where they return to any part of the public sector up to 12 months from the date of termination of their previous employment.
Having been expected to come into force in 2016, it is now the government’s intention that these regulations will be introduced in early 2017, although the exact date is yet to be confirmed.
Where individuals work through their own personal services company (PSC) for a public sector end user, but they would be employed by the end user (under the IR35 rules) were it not for the PSC, from 6 April 2017 the end user (or the agency that supplies the individual to the end user) will need to deduct employment taxes and NICs from payments made to the PSC, as if they were employment earnings.
Public sector bodies will be responsible for identifying and reviewing the employment status of all workers engaged through PSCs, including those provided via an agency. This legislation, which has been introduced to prevent those who are effectively workers from avoiding tax, is likely to create a significant burden for public sector organisations, particularly where there are several third parties in the supply chain. It is also likely to lead to claims for employment rights from individuals who are newly subject to PAYE.
Gender pay gap reporting regulations
These regulations come into force on 6 April 2017, subject to parliamentary approval, and require private sector employers with 250 or more employees to publish data annually regarding the remuneration of the male and female workforce. The first information is due to be published on 5 April 2018.
Although the regulations do not apply to public sector organisations, the government intends to introduce separate regulations that impose the same obligations on public sector employers. The public sector regulations are expected to be published shortly and the intention is that they will also come into force on 6 April 2017.
Story via – http://www2.cipd.co.uk/pm/peoplemanagement/b/weblog/archive/2017/02/02/employment-law-and-the-public-sector-in-2017.aspx