2017 will be another busy year from an HR perspective. Employment Law doesn’t stand still for long! To help you think about how changes might affect your business, we’ve put together a helpful guide to some of the key changes affecting SME’s in the year ahead.


A subject that divided the nation! The debate, planning and questions about its impact will go on.  Indeed, there’s no doubt we’ll all hear plenty more about it in 2017.

There are lots of questions including the potential impact on the free movement of people and therefore employees.  However, there’s no change for now and we’ll be keeping our eye on any relevant changes so we can keep you informed and up to date. 

Minimum and Living wage

The Living Wage was introduced in April 2016, so changes to the National Minimum Wage and National Living Wage will take place in April each year. The levels are already set for April 2017;

  • National living wage, for those aged 25 and over, goes up from £7.20 to £7.50
  • National minimum wage rises from £6.95 to £7.05 for workers aged 21 to 24
  • 18 to 20-year-olds will get a rise from £5.55 to £5.60 per hour
  • 16 or 17-year-olds will rise from £4 to £4.05 per hour
  • Apprentice rate will increase from £3.40 to £3.50 per hour

All changes take place on 1st April 2017.

National Insurance Contributions

The lower earnings limit for national insurance contributions will increase on 6 April 2017 to £113 per week.

Changes to Income tax allowances and thresholds

Changes to personal income tax allowances come into effect on 6 April 2017. The lower level personal income tax allowance threshold will rise to £11,500 and the higher rate rises to £45,000.

Tax-free childcare scheme

A tax-free childcare scheme is to be introduced in early 2017. Families where both parents work and each parent earns less than £100,000 per year will be eligible to receive 20% of their yearly childcare costs.

Statutory payments for SSP, SMP, SPP, ShPP and SAP

The Government plans to increase statutory sick, maternity, paternity, shared parental and adoption pay from 2 April 2017 as follows:

  • Statutory Sick Pay (SSP) – £89.35
  • Statutory maternity pay (SMP) and (maternity allowance) – £140.98
  • Statutory paternity pay (SPP) – £140.98
  • Statutory shared parental pay (ShPP) – £140.98
  • Statutory adoption pay (SAP) – £140.98

Changes to rules for employing foreign workers

Employers sponsoring foreign workers with a tier 2 visa will be required to pay an immigration skills charge of £1,000 per worker (£364 for small employers and charities) beginning in April 2017. The immigration skills charge will be in addition to current fees for visa applications.

In April 2017, the minimum salary threshold for “experienced workers” applying for a tier 2 visa will also increase to £30,000. New entrants to the job market and some health and education staff will be exempted from the salary threshold until 2019.

We’re here to help guide you through these issues. If you have any questions, please do get in touch.