As we approach the end of 2023, businesses are gearing up for the challenges and opportunities that the new year will bring. 2024 promises to be a significant year for workplaces, marked by a series of upcoming employment law changes. It’s crucial for employers to be well-informed and prepared to navigate these changes to ensure compliance and provide the necessary support for their employees.
- National Living Wage (NLW) and National Minimum Wage (NMW) adjustments
One of the most significant changes for 2024, revealed by Chancellor Jeremy Hunt in his Autumn Statement, is an increase in minimum wages, set to positively impact around 2.7 million of the lowest-paid workers.
The National Living Wage (NLW) and National Minimum Wage (NMW) are both scheduled to rise from April 1, 2024. The NLW (currently applicable to individuals aged 23 and over) will experience a substantial near 10 per cent increase, rising from £10.42 to £11.44 per hour.
It’s noteworthy that the government will also expand the eligibility for the living wage, ensuring that 21-year-olds will receive the full amount for the first time from April 1, 2024. This increase translates into a substantial 12.4 per cent rise in pay for 21-year-olds, from £10.18 to £11.44, offering an annual boost of nearly £2,300.
Similarly, individuals aged between 18 and 20 will experience an hourly pay increase of £1.11, bringing their rate up to £8.60 per hour.
The updated minimum wage breakdown is as follows:
- National Living Wage for over-23s: £11.44 per hour, up from £10.42
- National Living Wage for those aged 21-22: £11.44, up from £10.18
- National Minimum Wage for 18 to 20-year-olds: £8.60, up from £7.49
- National Minimum Wage for under-18s: £6.40, up from £5.28
We advise employers to carefully review their wage structures to maintain differentials within their workforce and ensure compliance with the updated rates to avoid potential claims, penalties, and reputational damage.
- Pensions (Extension of Automatic Enrolment) Act 2023
The Pensions (Extension of Automatic Enrolment) Act 2023 is set to widen the scope of employees eligible for pensions auto-enrolment. The minimum age for automatic enrolment may be reduced from 22 to 18, allowing younger employees to start saving earlier and benefit from employer pension contributions. Additionally, there’s a possibility of removing the minimum earnings threshold of £6,240, potentially increasing contributions by almost £500 annually. Employers are encouraged to stay informed and consider implementing contractual enrolment for new employees as part of their pension strategy.
- Carer’s Leave Act 2023
The Carer’s Leave Act 2023 introduces a statutory right for employees to take up to one week of unpaid carer’s leave in a 12-month period to care for a dependent. Expected to be effective from April 2024, this law aims to support employees balancing work responsibilities with caring for family or friends in need of long-term care. With an estimated benefit for over 2 million UK employees, this legislation underlines the government’s commitment to helping workers stay in employment while fulfilling caregiving responsibilities.
- Neonatal Care (Leave and Pay) Act
Scheduled to be effective in 2024, the Neonatal Care (Leave and Pay) Act grants employed parents of babies admitted to neonatal care the right to take up to 12 weeks of paid leave. This leave is in addition to existing entitlements such as maternity and paternity leave. Employers should be prepared for the implementation of this Act, considering its potential impact on employee benefits and company policies.
- Protection from Redundancy (Pregnancy and Family Leave) Act
Expected to come into effect in 2024, the Protection from Redundancy (Pregnancy and Family Leave) Act extends existing protections for employees on maternity leave to those on adoption leave and shared parental leave. Employers are now required to offer suitable alternative vacancies to employees on these types of leave, enhancing job security during family-related absences.
- Rolled-Up Holiday Pay for irregular workers
A change in legislation, effective from April 1, 2024, allows employers the option to use rolled-up holiday pay for workers with irregular hours or those who work part of the year. While this practice has been previously deemed unlawful, the new legislation permits its limited use for specific worker categories. Employers opting for rolled-up holiday pay should assess eligibility, verify compliance, and establish processes to implement this option.
- New accrual system for holiday pay
In response to the Supreme Court ruling in Harpur v Brazel, the government is introducing new legislation to calculate holiday pay for irregular and part-year workers at the hourly rate of 12.07%. Effective from April 1, 2024, this change simplifies calculations for employers and is subject to a maximum of 28 days per year. Employers should familiarise themselves with the updated legislation to ensure accurate and compliant holiday pay practices.
- Right to request flexible working arrangements
Anticipated changes to the right to request flexible working arrangements are expected to come into effect in 2024. These changes include the right to make a flexible working request from day one of employment, eliminating the current 26-week continuous employment requirement. Employers should consider developing or updating flexible working policies to accommodate these changes and facilitate a smooth process for handling requests.
- Predictable working for certain workers
Around September 2024, a new statutory right for workers, including agency workers, to request a more predictable working pattern is expected to be introduced. Relevant for workers with uncertain working patterns, such as casual or annualised contract workers, this right aims to provide stability. Employers should prepare for the implementation of this right, including establishing a procedure for handling requests and staying informed about the forthcoming Code of Practice from Acas.
As we can see above, 2024 is poised to bring a wave of significant changes to employment law, impacting employers and employees alike. Navigating these changes requires careful consideration, preparation, and a commitment to staying informed. We encourage employers to review their policies, communicate changes to their workforce, and seek legal guidance if needed. Hutchinson Thomas Solicitors is ready to assist employers in understanding and adapting to these changes, ensuring a smooth transition into the evolving landscape of employment law.
At Hutchinson Thomas, we work with employers across all their employment law requirements. If you would like to discuss any aspect of your legal needs with an expert employment solicitor, call us on 01792 439 000, or fill in our contact form.