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Employment law update

03 Oct 2016

NEW: Payments in lieu of notice (PILONs)

Legislation, set to be introduced in April 2018, will provide for all PILONs to be subject to income tax, employer NICs and employee NICs, even if there is no express or implied contractual right to pay employees in lieu of notice. If the legislation proceeds, employers will therefore no longer be able to offer their employees tax free PILONs as a sweetener in negotiated severances.

UPDATE: Reasonable adjustments

A case has held that where an employee with a disability moved into a less demanding role in order to accommodate their disability, their existing salary should have been honoured as a ‘reasonable adjustment’. The reasonableness of adjustments must, of course, be assessed on a case-by-case basis. Full advice should therefore be taken before lowering salaries due to this decision.

UPDATE: Holiday pay – again!

An employment tribunal has recently decided that when calculating holiday pay, employers should include usual overtime, call out and standby payments. The fact that the employee volunteered for these additional duties was held to be irrelevant. Although this decision is not binding, it does demonstrate that the courts are moving towards a position whereby holiday pay should include all monies usually received by employees.

We will keep you posted on this ever changing area of the law.

For further information or advice, please contact a member of our employment team.