Tue 05 Jan 2021

January - what else is happening in employment law?

We look at what is happening in employment law away from the COVID-19 pandemic.

The UK Government has announced an increase in the National Living Wage (NLW) and National Minimum Wage (NMW) which will come into effect from April 2021. The NLW has increased from £8.72 to £8.91 and it has been extended so that it will apply to 23 and 24 year olds for the first time - something for employers to be aware of next April.

The new rates with effect from April 2021:-

  • NLW increased from £8.72 per hour to £8.91 per hour (previously those was only for those aged 25 and over but this has now been extended to anyone aged 23 and over)
  • NMW 21 to 22 year old rate increased from £8.20 per hour to £8.36 per hour (previously this was for those aged between 21 and 24)
  • NMW 18 to 20 year old rate increased from £6.45 per hour to £6.56 per hour
  • NMW 16 to 17 year old rate increased from £4.55 per hour to £4.62 per hour
  • NMW apprentice rate for those aged under 19 or in their first year of an apprenticeship increased from £4.15 per hour to £4.30 per hour

The Department for Work and Pensions (DWP) has published its policy paper with proposed increases to its pension and benefit rates for 2021-2022. Amongst the proposals are a number of family friendly benefit increases including an increase in statutory maternity pay (SMP) and statutory paternity pay (SPP) from a weekly rate of £151.20 to £151.97. Statutory shared parental pay and shared adoption pay, which are paid at the same weekly rate as SMP and SPP, are also due to increase to the same weekly rate. Statutory sick pay will see a rise to a weekly rate of £96.35 - up from £95.85. Increases normally take effect from the first Sunday in April, which would be 4 April 2021.

A report published by the Institute for Employment Studies (IES) has found that obesity "discrimination" is still a major problem in the UK. The report considered the impact this has on employees living with obesity and suggested that such employees, particularly women, are subject to wage penalties and other career barriers. Estimates included in the report show that women who live with obesity can face a wage penalty of up to 13%. This equates to a loss of £3,250 per annum in wages. Other barriers faced by women living with obesity included lower success in recruitment processes, less opportunity to achieve promotion and a greater chance of being dismissed. In contrast, men living with obesity benefit from a wage premium, the report suggests. In light of those findings, IES recommended that employers include provision for obesity in their diversity and inclusion policies and highlighted the need for a safe and supportive working environment.  Obesity is not a protected characteristic under the Equality Act.

The Government Equalities Office has published new guidance on gender pay gap reporting.  There are five separate documents:-

The Work and Pensions Committee is to launch an inquiry to investigate the disability employment gap. This is the difference in employment rates between disabled and non-disabled people. The most recent official statistics published by the UK Government have shown that employment rates among disabled people was at 53.2%, an improvement of 2% from last year. The rate for non-disabled people increased to 81.8%, up from 81.4%. The inquiry will look at how the support provided by the Department for Work and Pensions can be improved as well as considering the continuing impact of the coronavirus pandemic.

Lloyds Banking Group has become the first major UK bank to disclose its black pay gap. The data released by Lloyds as part of its wider race action plan showed that its black staff are being paid almost 20% less than their colleagues, with the median pay gap being 19.7%. The bonus pay gap was even greater, standing at 37.6%. Lloyds assert that this is due to the fact that only a very small number of black staff hold senior positions that come with larger salaries and bonuses in the company. In fact, although black employees make up 1.5% of Lloyds staff they only hold 0.6% of the senior roles at Lloyds. The bank has pledged to increase this number to 3% of black staff holding senior posts by 2024. The bank also announced on Friday that it was launching a black business advisory committee to look into the obstacles faced by black-owned businesses. This will be led by former Cabinet Office adviser Claudine Reid and its research and recommendations will be released in the spring. The Lloyds staff union, Accord, also called for other banks to publish their ethnicity pay data and underlined the need for the UK Government to introduce mandatory ethnicity pay gap reporting. 


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