Employers across the four home nations and beyond would universally welcome a return to normal after almost a year of adapting to change brought about by the COVID-19 pandemic. As we approach the first anniversary of the first COVID-related lockdown, this is a good time to look ahead at a few important changes for employers to note.
The current evolution of the Coronavirus Job Retention Scheme (‘CJRS’) (announced in November 2020) was due to end on 31st March, but has now been extended to April 2021. The benefits of the scheme are well known; that is true for employee and employer alike. As an employer, you have a separate administrative duty in keeping detailed records for review. We await the publishing of CJRS data on Gov.uk which will allow your employees to locate their employer and identify if a CJRS claim has been made in their name towards the end of February. The overwhelming majority of businesses have nothing to fear from this measure, having kept to the letter and spirit of the regulations; undoubtedly a minority could be exposed. HMRC already publish the names of those who fail to pay National Minimum Wage rates and it doesn’t take a huge leap of imagination to see the potential for a similar CJRS process being applied in the months ahead.
April will bring a new tax year and, as before, we have been given notice of some changes ahead of the Budget that we should be ready for. One significant change is the reduction in age from 25 to 23 to qualify for the National Living Wage. The rate payable increases to £8.91 with a larger cohort of employees included.
You can also expect some changes to the Higher Rate tax band and NIC thresholds, with this being included in the November HM Treasury spending review. The administrative changes are lessened when using payroll software that should be updated in advance of the new tax year. An adjustment based on the CPI rate (September) will be applied to these thresholds and also the personal tax free allowance.
You may have missed the update to The Pension Regulator (TPR) website and guidance for compliance duties during the disruption and challenges brought by the lockdowns. As we have observed, TPR are not shy when it comes to using their powers to issue daily penalties. They have updated their advice to remind employers that duties remain the same, and timelines for compliance unchanged. They do note that they will apply a proportionate and risk-based approach to enforcement decisions.
As your employees may continue to be absent due to COVID infections or the need to self-isolate for some time, a reminder that Statutory Sick Pay (SSP) is due from day one of any related absence, instead of the usual 3-day waiting day period applied for other absences. Employers can also reclaim two weeks of SSP per employee. Employers are encouraged to keep detailed absence records as they may impact and support CJRS claims.