Legislation Update

Important Changes from 1^st October 2008

With the Summer now over ('What Summer'?!? I hear you ask) it is usually at this time of year that we turn our attention towards planning for the few months ahead that will lead us to the end of the year.

With this in mind, and in line with the usual legislative cycle which sees the introduction of changes in employment law during April and October, we have set out below the developments which must be incorporated into your own plans.

National Minimum Wage

On 1^st October 2008, the national minimum wage rates increased to the following:

£5.73 per hour for workers aged 22 and over

£4.77 for workers aged 18-21, and

£3.53 per hour for workers aged 16-17  

The national minimum wage applies to nearly all workers (with some exceptions for those 'in training' or those below the age of 16) and sets hourly rates below which pay must not be allowed to fall.   The new rates specified above will apply until 30^th September 2009.  

Maternity Rights

Following our recent newsletter article on maternity rights, we thought it would be useful to recap the forthcoming change to maternity rights that will affect employees whose babies are due to be born on or after 5^th October 2008.    

As you are no doubt already aware, all pregnant employees are entitled to 52 weeks of maternity leave, regardless of their length of service, and this is viewed as being made up of 26 weeks of ordinary maternity leave (OML) followed by a further 26 weeks of additional maternity leave ( AML).   At present, employees on maternity leave can only enjoy the benefit of the terms and conditions of employment which would have been applicable to them if she had not been absent (not been pregnant or given birth to a child) during a period of OML. However, from 5^th October 2008 this right will be extended to cover periods of AML as well.   (Please note however, this right does not refer to any entitlement to salary).

In practice therefore, this means that from 5^th October 2008 an employee's contractual rights will not merely be preserved during OML and AML, but they will actually continue to accrue.  For example, an employee will continue to be entitled to any contractual holiday entitlement over and above the statutory minimum, and where applicable, to the fringe benefits of company cars, mobile phones, gym memberships and health insurance (amongst any such others provided during their employment) for the whole 52 week period.

Pension contributions will also continue to be payable by the Company at the employee's full pay for the first 39 weeks of maternity leave only however, employee contributions need only be based on her actual maternity pay.

As employers, you should now be amending your employment policies and practices to reflect these changes, and as such, if you require any assistance or further information, please contact Hannah on (01404) 42359 or email her at hannah@hradvantage.co.uk

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