Labour’s recent landslide victory means significant changes that payroll professionals must be prepared for. As these new policies are rolled out, Cactus Payroll is here to support you through each transition. Here’s a breakdown of the key areas affected and how you can stay informed and compliant.
The Living Wage
One of the most notable changes on the horizon is the adjustment to the National Minimum Wage. The Labour government aims to transform this into a real living wage that reflects the cost of living. This shift will involve:
Changing the Low Pay Commission’s remit to include considerations for living costs.
Ensuring the minimum wage aligns with economic conditions and median wages.
For payroll professionals, this means updating payroll systems to accommodate these changes and ensuring employees are paid according to the new standards.
Stricter Enforcement and Penalties
Labour’s reintroduction of the Single Enforcement Body marks a significant move towards stricter compliance:
Employers must maintain meticulous records and adhere to stringent compliance checks.
There will be increased penalties for non-compliance, necessitating a proactive approach to payroll management—this highlights the importance of accurate and up-to-date payroll systems to avoid hefty fines.
Ban on Zero-Hour Contracts
In line with their Securonomics agenda, Labour plans to:
🌵Ban exploitative zero-hour contracts.
🌵End practices like fire and rehire.
🌵Ensure all jobs provide a baseline level of security and predictability.
Employers must revise contracts to reflect these changes, ensuring that employees’ hours are consistent and predictable based on a twelve-week reference period.
Addressing Pay Gaps
Labour’s commitment to expanding pay gap reporting will now include:
🌵Ethnicity
🌵Disability
This expansion is a step towards greater pay equity, requiring payroll systems to support more comprehensive reporting and analysis.
Embracing New Technology
The integration of advanced technologies, such as AI and automation, is set to play a critical role in the future of payroll. These technologies will streamline payroll processes and enhance overall business operations. Keeping your payroll systems updated with the latest technology will be crucial for staying ahead of these changes.
Staying Informed
Staying informed is essential as new policies are likely to be announced in the coming weeks. Here are some ways to keep up-to-date:
🌵Regularly check the HMRC website for updates.
🌵Stay in contact with Cactus Payroll for guidance and support.
Navigating these changes can be challenging, but Cactus Payroll is here to help. If you have any questions or need assistance with your payroll systems, please get in touch with us. Our team is ready to support you through these transitions, ensuring compliance and efficiency in your payroll processes.