The changes to IR35 in the public sector may be hogging the headlines, but recruiters should not overlook the other important changes this month, including the Apprenticeship Levy, Gender Pay Gap (GPG) reporting, increases in the national minimum wages, changes to statutory payment rates, and the modern slavery disclosure duty all starting to kick in.
Whether these changes apply to your business (and to what extent) will depend upon several factors:
- the Apprenticeship Levy is only charged on pay bills over £3m (including PAYE temps)
- GPG reporting applies only to businesses with over 250 employees (including PAYE temps)
- the modern slavery disclosure duty applies to businesses with a turnover above £36m.
Minimum wage and statutory payment rates such as sick pay or maternity pay may be a greater concern if your business operates a large PAYE payroll or has lower wage rates. PAYE numbers are, in any event, expected to rise in light of the IR35 off payroll rules.
Hirers demand compliance
Even if the changes do not apply directly to your business, more hirer contracts are now requiring compliance with legislation. For example, the proposed new public sector rules on modern slavery may mean that failing to publish a Slavery and Human Trafficking Statement could result in your business being excluded from public sector supply chains.
Disproportionate impact on recruitment sector
The impact of the legislative changes will differ from business to business, but the impact on the recruitment sector is clearly disproportionate, as recruiters supplying staff are likely to have higher payroll bills and turnover than similar sized businesses in other sectors.
Minimise the risk
Theresa Mimnagh, Associate director of Lawspeed said “There is a lot of change happening within a short period of time, with different focusses and priorities for different businesses. There is a great deal of confusion because so many accepted practices and arrangements are changing. Many recruiters that have traditionally operated PSC models will have to get to grips with PAYE options, and the different rights that apply, such as holiday pay, statutory payments such as sick pay, or the AWR. Equally, recruiters are once again looking to umbrella options, but are keen to ensure compliance, and that any risk is minimised.”
Get help to understand the changes
It is vital to understand the changes and the impact they will have on your business, as well as knowing how to deal with the new requirements. Lawspeed has twenty years’ experience advising the recruitment sector and has been taking a pro-active approach to the challenges ahead. From providing recruitment-specific modern slavery documentation, offering bespoke advice on IR35 and the Apprenticeship Levy, to reviewing and drafting contractual terms to minimise risk, Lawspeed can help. Call us on 01273 236236