What’s in store for employment law in 2017?

3 February, 2017
by: Cripps Pemberton Greenish

A brief summary of the year to come.


Despite the recent Supreme Court ruling, Theresa May still hopes to trigger Article 50 in March. This won’t result in any immediate changes to employment law because the Government plans to transpose EU law into domestic law initially, to ensure a smooth transition. 

The gig economy

‘Gig economy’ was the buzz phrase of 2016 referring to the trend for short term, on-demand work where people would get paid for the ‘gigs’ that they do. In October, an employment tribunal found that Uber’s drivers are actually ‘workers’ entitled to minimum wage, holiday and sick pay. Uber has appealed the decision so the future of the ‘gig economy’ will remain in focus in 2017.

National Minimum Wage and National Living Wage

The national minimum wage will increase as follows from 1 April:

  • 16-17 years old           £4.05
  • 18-20 years old           £5.60
  • 21-24 years old           £7.05

The National Living Wage, which is the rate set for those aged 25 and over, will go up to £7.50 per hour.

Apprenticeship levy

From 6 April this year businesses with an annual pay bill of over £3m will be required to invest in apprenticeships by contributing 0.5% of that pay bill by way of an apprenticeship levy (less an annual allowance of £15,000). The Government will also be introducing changes to the way that apprenticeships are funded from 1 May onwards, by introducing a co-investment scheme for smaller employers.

Gender pay gap reporting

6 April also sees the introduction of the requirement for employers with 250 or more employees to publish information about their gender pay gap. Data must be published no later than 4 April 2018 but will need to be gathered in 2017. 

Pension auto enrolment

Most smaller businesses will be due to start auto enrolling staff in workplace pensions this year. The minimum levels of contributions will be phased, but full contributions will have to be made from 1 October 2018. 

Salary sacrifice schemes

Under salary sacrifice schemes, employees receive non-cash benefits such as company cars and gym memberships in exchange for part of their salary. As a result, the employee pays less tax. The Government will be clamping down from April when such schemes will loose their tax relief status. Certain benefits will be unaffected, including cycle to work and childcare schemes.  

Tax-free childcare

Under a new Government scheme, which is expected to launch early this year, parents can expect to receive 20% off their childcare costs, subject to a cap of £2,000 per child, per year. Parents will need to earn between £115 per week and £100,000 per year to be eligible.