Employment Law Changes to Watch Out For in 2021

Are you aware of the upcoming changes to work regulations?

As we begin to navigate the aftermath of Brexit and COVID-19, 2021 will see key changes in the way employment works. This blog will cover some of the important changes to recruitment law you need to know, that will affect the Recruitment Industry over the next 10 months.


IR35 refers to tax legislation put in place to stop workers from achieving tax avoidance by using an intermediary limited company. The new laws should have been implemented in April 2020 but that was postponed during the initial lockdowns due to coronavirus.  Now on April 6th 2021, large and medium sized firms will be responsible for assessing the IR35 status of any limited company contractors they use.  It is well worth being aware of these changes and if you are a contractor, or an intermediary with workers providing services to a client, ensure you are prepared before April.  We’ve collated a helpful guide to IR35 for recruiters.

EU Immigration

With Brexit made official at the beginning of 2021, the way we move within Europe has changed.  From June 30th, 2021 the responsibility to ensure a worker has the right to work will lie with the employer.  All foreign nationals will have to meet certain criteria and earn at least 70 points under the Skilled Worker Route to be able to work in the UK.  The main need will be to have been offered a job from an approved sponsor.  Any company wishing to employ foreign workers need to apply for the license now.

The details can be found in the government published document; Statement of Changes to the Immigration Rules HC813.

End of Furlough

The Coronavirus Job Retention Scheme that has provided companies the opportunity to furlough their staff, will finish 30th April 2021.  Now is the time to consider the options for any staff still on furlough.  Unfortunately, in some cases redundancy will be unavoidable, however it is worth considering offering temporary unpaid leave, flexible working, or reduced hours if possible.

Job Retention Bonus

The Job Retention Bonus is a one-off taxable payment of £1,000, payable to employers for every eligible employee who has been furloughed and kept continuously employed through to the end of January 2021.  The claim window for this is from February 15th up to 31st March 2021.

Redundancy protection for pregnant employees

Similarly, rules hoping to balance gender differences in child and dependant care are changing, introducing entitlement to one weeks leave for unpaid carers and extended parental leave for neonatal care.

National Living Wage

From 1st April there will be wage increases across all age groups and the NLW will include workers aged 23 and over.

New hourly rates

National Living Wage     £8.72 to £8.91

Age 21-22                     £8.20 to £8.36

Age 18-20                     £6.45 to £6.56

Age 16-17                     £4.55 to £4.62

Apprentice rate             £4.15 to £4.30

From 6th April 2021, Statutory Sick Pay (SSP) will increase from £95.85 to £96.35 per week

From 4th April 2021, parental pay will increase from £151.20 to £151.97 per week. This includes maternity, paternity, adoption, shared parental and parental bereavement pay.

Work/Life Balance

At Back Office Support Services we are always keeping our clients up to date with the latest developments and changes in recruitment law – as well as offering an exceptional service in payroll, 100% funding, credit control and debt protection. To find out more, talk to one of our team on 01260 280290 or send us an email.

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