With Chancellor Phillip Hammond giving his first and last Autumn Statement, millions tuned in eager to know how it would affect them. From the National Living Wage to National Insurance contributions we’ve put together a quick guide to the Autumn Statement changes for employers.
National Minimum Wage
From April 2017 the National Living Wage will increase from £7.20 to £7.50 for anyone over 25, equating to an increase of more than £500 a year for full time workers. That’s not all, workers on the National Minimum Wage will see an increase in their pay packet too.
◾ 21-24 year olds will receive an increase of 10p per hour from £6.95 to £7.05
◾18-20 year olds will receive an increase of 5p per hour from £5.55 to £5.60
◾16-17 year olds will also receive an increase of 5p per hour from £4 to £4.05
◾The hourly minimum wage for apprentices will also increase from £3.40 to £3.50
While this is good news for workers, employers will feel the squeeze following additional costs such as the apprenticeship levy, pension auto-enrolment increases and the recent changes to holiday pay.
Employers in the retail and hospitality sector had the worst to fear from the increase, although they were able to offset the costs by increasing prices, reducing hours or reducing premium payments but this may come at the expense of a customer / employee backlash.
For other sectors who do not have the luxury of offsetting costs through flexibility, they may find themselves having to increase productivity or passing on the additional cost to customers. This may have a detrimental effect on customers, especially if you are not offering an improved service.
Personal Allowance Increase
From April 2017, the tax free Personal Allowance will increase from £11,000 to £11,500 with the higher rate threshold also increasing to £45,000. Hammond also confirmed they are still on track to meet their target of a tax free personal allowance of £12,500 by 2020.
From 2020, the increase is expected to rise with inflation as opposed to the NMW.
Employee Shareholder Status (ESS)
Hammond confirmed that the tax relief available under the Employee Shareholder Status will be abolished for any agreements commencing 1st December 2016. The Government have also confirmed that they are looking to abolish the ESS status altogether 'at the earliest opportunity'.
Hammond announced an end to most salary sacrifice and benefit in kind schemes from April 2017. Describing both as “unfair” and confirming that employees who use these schemes will pay the same tax as everyone else.
Schemes that will be exempt from the axe include pension contributions, cycle to work and childcare vouchers.
From April 2018, the current arrangement on taxation of termination payments up to £30,000 will continue, however for payments over the £30,000 NICs will apply.
From April 2017, National Insurance payments for employees and employers will align with payments starting on weekly earnings of £157 or more. While this change is expected to make payments simpler for all involved, the treasury confirmed it will cost employers an extra £7.18 per employee per year.
If you’d like to know more about the changes and how they affect your business contact Opsium for the latest guidance and advice.
With Christmas fast approaching you may notice a veil of lethargy drape over your team like a fog in a snow storm. So how do you keep your team motivated during the festive period?
We’ve put together a few handy tips to ensure your Christmas goes off with a ‘ho ho ho’ instead of a ‘bah humbug’.
If you’re lucky enough to have been trading for a few years, you should be able to accurately predict your peaks and troughs of the year. This will give you a better understand of the staff levels you need to ensure that customer service and productivity don’t suffer.
If in doubt, create a list of employees who could be ‘on-call’ should you find yourself understaffed during the busy periods.
There’s no harm getting into the festive spirit. Inject some fun into the office with a Christmas quiz, decorations or some Christmas tunes to get people in the mood. Keeping spirits high will go a long way to increasing productivity and to stop employees pining for home.
Every little helps
More and more of us are shunning the high street battleground and shopping online. By letting your staff have their Christmas shopping delivered to the office you can help remove one of their biggest stresses, enabling them to focus on the task at hand.
Arrange for parcels to be stored in a convenient and secure location. They can then be collected at the end of the shift, ensuring piece of mind all round.
If you are able, why not allow employees to rearrange their hours slightly. Offer an early start / finish and a late start / finish shift pattern to help employees manage their work-life balance at this busy time of year.
Frankie says RELAX
If you have a business dress code try relaxing it over the Christmas period by implementing festive dress of red and green or Christmas jumper days.
Nobody likes a Scrooge
Why not offer ad-hoc prizes amongst the staff to spread some holiday cheer. Mini raffles and best-dressed awards will encourage people to get involved and incentivise staff.
One more thing, it's not just holidays that are coming, it’s also sick days!
With the change in weather, increased social activities and stress of getting things sorted for Christmas you are bound to see an increase in absence during the winter months. If you need to know how to better manage sickness and unauthorised absence call us for advice.
With Christmas on the horizon, it’s time for a lot of companies to begin winding down and taking stock of another business year. For staff, it’s the time to prepare for the Christmas party, for the HR department it’s a minefield.
But, it doesn’t have to be…
There’s a great deal of trust involved in providing your employees with alcohol and having them let loose outside of the office environment whilst socialising with people who’ve spent the last 12 months pushing their buttons.
From arguments to fights and flirting to harassment, HR departments need to be out in front of any possible issues before they have the opportunity to dig their claws in.
Code of conduct
Before the event, set out your stall clearly to all staff. A simple message to everyone encouraging them to have fun but also detailing the code of conduct you expect them to observe during the event. Remind staff that they are representing the business and you expect them to behave as such.
Limit the alcohol intake
While some companies may implement an open bar, others chose to provide drinks vouchers and exercise strict limits on servings of alcohol, i.e. no doubles or triples.
Call it a night
If you’re arranging the party at a venue, state the time the party is due to end. Make it clear that employees who choose to continue on at another venue do so at their own risk. If they act in a way that brings the company into disrepute or harms relationships in the workplace they could still be at risk of repercussion.
Have your fairy godmother on hand with a pumpkin
One way to ensure people get home is to plan their transport at the end of the night. A few pre-booked taxis at the end of the party should ensure that most people get home safe without too much hassle. Employees tasked with getting home under their own volition may find themselves being distracted by something shiny, and continuing the night into the wee hours. Mitigate any risk by having a clear plan of action for the end of the night.
Manage your expectations
While it would be advantageous to have the night go off without a hitch, it’s always best to manage your expectations. There will be drunken behaviour and it’s likely that there will be words exchanged in the heat of the moment. You need to establish what is a HR issue and what is a byproduct of alcohol and reduced inhibitions.
If in doubt, Opsium employer support will be able to work with you to establish whether an incident warrants further action.
The morning after the night before?
So you’ve survived the night, but what about the morning after? Many companies choose to have the Christmas party on a Friday to avoid the inevitable sick days that follow, whereas others will have the party midweek in an effort to stop employees getting too carried away. Which one is right?
It’s an either-or scenario as regardless of what you choose there will always be one. With that in mind, it’s best to address the issue of post-party absence before the event. Let employees know that they will have their pay deducted if they are late or fail to attend.
Alternatively, you can work with staff to encourage attendance. Offer staggered working shifts for the following day, while some will want to get in early and get the day over with, others will be glad of the lie in. If you give employees the option they are less likely to take advantage come the morning.
The important bit
Set out your stall. Don’t leave anything to chance and explain to your employees exactly what you expect of them. The Christmas party should be an opportunity to celebrate your successes for the year as a team. By following our few simple steps you can ensure it’s a night to remember.
Do you crack the whip at work? Do you hate seeing staff chat amongst themselves or getting up to make another drink? Do you run a tight ship? If so, your staff probably aren’t that productive.
According to a report commissioned by office stationery firm, Viking, staff that are able to procrastinate from time to time are usually the most productive overall.
Viking surveyed 2,000 office and home workers across the UK and discovered that, on average, home workers are the most relaxed and stress free of the bunch, and that’s not because they do less work. In fact, home workers are the most productive of the group.
Research conducted by online meeting and screen sharing firm, Join Me, found that 80% of employees are equally as productive, if not more so, working from home. Responses from those surveyed included words such as;
‘Flexible’, ‘comfortable’, ‘no interruptions’, ‘quiet’, ‘less distractions’.
Besides being all they can be at home without the distractions of the workplace, home workers also have more breaks than the average office worker. Viking found that 39% of people who work from home take three or more breaks during the working day, as opposed to 52% of office workers who admitted to not taking any breaks at all, excluding lunch.
Probably the one downside to working from home is the feeling of isolation. 67% of office workers said they had someone to talk to when stressed, while almost half of home workers admitted to having no one to speak to. On the flipside to that, people who work from home often have less negative thoughts to contend with and get off their chest. Over half of all office workers questioned admitted to having negative thoughts about work every day or at least a few times a day, compared to just one third of home workers.
So what does this tell us? If you can accommodate staff working from home you may find that they are generally happier, while being more productive overall. Why not trial it on a temporary basis to see if it works for your business. You may be surprised.
Last month saw the publication of the Court of Appeal judgement in the case of Lock v British Gas. This case has been rumbling on for some time and the latest judgment simply confirmed the position that employers need to account for commission in holiday pay.
Since this was announced we have been continually talking to employers who are either unaware of this case or have taken the view it is not a concern. However, for any business that pays employees individual result based commission as part of their pay, this case has significant cost implications.
The background to this case is as follows:
The immediate concern for employees is the issue of potential back pay claims. The government has introduced the Deduction from Wages (Limitation) Regulations 2014 which limit employers’ exposure to claims for backdated holiday pay to two years.
Businesses who have not taken action face the risk of being confronted by employees seeking, in effect, an increase in pay and a back pay claim. By tackling the outcome of this case head on and making appropriate adjustments now, businesses can avoid conflict and potentially save costs.
Employers will need to review any additional payments being made to staff which are not included with the holiday pay calculation and consider what changes need to be made going forward. Employers are advised to contact Opsium for advice on how these decisions will impact on your business and what changes need to be made to your current arrangements.
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