Employment Law Changes from April 2011

There have been a number of changes to employment law, which have now come into effect from April 2011. The main ones are the changes to paternity leave, the removal of the default retirement age and changes to tax on termination payments.

Parents of babies due on or after 3rd April 2011 (or adoptive parents notified of a match with a child for adoption on or after that date) now have the right to take up to 26 weeks' additional paternity leave ("APL"), over and above the existing one or two weeks' ordinary paternity leave entitlement.

The new right applies to the child's biological father or the spouse or partner of the child's mother (or to the spouse or partner of the main adopter), where that person has the main responsibility (other than the mother/main adopter) for the child's upbringing. Provided the mother/main adopter was entitled to statutory maternity/adoption leave and returns to work before using up the full leave entitlement, the other parent/spouse employee may take APL.

To qualify, employees must have worked for at least 26 weeks (prior to the 14th week before the child's expected birth week or the date the child is to be matched to the adopter). The employee must give 8 weeks' notice of the intention to take APL and must supply a written declaration from both parents/adopters, confirming the relationship with each other and with the child. The employer can then request formal evidence such as a birth certificate and details of the mother/main adopter's employer. The parent/spouse employee will also be entitled to receive additional statutory paternity pay where the mother/main adopter returns to work at least 2 weeks before her entitlement to statutory maternity/adoption pay expires.

The default retirement age of 65 was abolished with effect from 6 April 2011. Employers should therefore no longer be issuing notices of retirement to force an employee's dismissal at the age of 65.

From 6th April 2011 employers are no longer able to deduct only basic rate tax from termination payments made after the issue of a P45. 40% higher rate or 50% additional rate tax must be deducted from the relevant proportion of the termination payment at source by the employer, even where the termination payment is made after issue of the P45.

For more information on this or any employment or HR issue, please contact Jo Cosgrove.