Traditionally, April is when the Government brings in new developments in the field of HR and employment law, and this year is no exception. April 2017 sees two major initiatives taking effect which food and drink businesses need to be aware of.
Apprenticeship levy
At a time when the food and drink sector is facing increasing costs pressures and recruitment uncertainty following Brexit, we believe that apprenticeships will increasingly come to the fore. They are very much in the Government’s mind and the new apprenticeship levy comes into force in April.
The levy is payable by employers in both the private and public sector that have annual wage bills of more than £3 million. The levy is payable through PAYE alongside employers’ existing income tax and National Insurance obligations. Although the Government has said that less than 2% of employers will be liable to pay the levy, it is part of a wider apprenticeship regime that will impact, and ultimately benefit, employers of all sizes.
The rate of the levy is set at a level of 0.5% of a levy-paying employer’s annual wage bill, less an annual allowance of £15,000 (spread evenly through the year). Levy-paying employers will be able to access funding for apprenticeships through a new digital apprenticeship service account. They will receive a 10% top-up to the levy paid, credited to their digital account. Funds in apprenticeship service accounts will be lost 24 months after entering the account.
Non-levy paying employers will not be required to use an apprenticeship service account until 2018 but will, in due course, also have a digital account. Through a process of co-investment, the Government will meet 90% of the costs of the selected training (up to the maximum amount of Government funding available), with the business paying the balance of 10%.
The funds in apprenticeship service accounts can be used to meet the costs of approved apprenticeship training and assessments up to the funding band maximum for that apprenticeship. They cannot be used to fund wages, travel costs, traineeships, work placement programmes or the cost of setting up an apprenticeship programme.
In addition to the apprenticeship levy, Government is working with employers across the UK (known as trailblazers) to design new apprenticeship standards which will replace the existing apprenticeship framework. The food and drink industry, in collaboration with The National Skills Academy for Food & Drink, has been actively involved in that process and various new apprenticeship standards have already been developed, or are in development, including Butchery, Bakery, Dairy Technologist, Food Technologist, and Food & Drink Advanced Operator. The process of replacing the apprenticeship frameworks is scheduled to be completed by 2020, by which time Government hopes that all businesses will recognise the value and benefits apprentices can bring to their organisation and the wider economy.
Gender pay gap reporting
By April 2018, organisations employing 250 or more employees will be obliged to publish detailed data on the gender pay gap within their workforce. The data to be reported will cover mean and median gender pay gap, mean and median gender bonus figures and distribution of men and women within the business.
Although the publication date seems some way off, the data reported will, in fact, be based on a ‘snapshot’ of data from April this year, 2017. It doesn’t leave long to prepare for what are rather detailed and prescriptive regulations on how the data must be compiled. Further, even if you employ fewer than 250 employees, it is likely to be only a matter of time before the net is cast wider and there’s no reason not to get your house in order now.
We are advising employers likely to fall within the scope of the regulations to progress preparations urgently in terms of:
- the practical aspects – capturing the right data for the right employees and doing a dummy run; and
- managing reputation (specifically with current and potential future female employees) – what commentary would you put on your gender pay gap data if you had to publish it today?
We can help with these issues and our briefing note provides more information.
Ellie Hibberd is a senior associate and head of HRExpress. For more information please contact Ellie on 01392 210700 or email employment@stephens-scown.co.uk