Business Law & Compliance

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New Year, new legislation: What businesses need to know in 2013

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At least 13 pieces of new or changed legislation will impact British businesses in 2013. There has been an increased focus on simplicity and cost-savings. With the help of Riverview Law, Real Business has provided a brief overview of what the planned changes will mean to business in the new year.

1. “One-in, two-out” rule

New regulations forcing financial burdens on firms must be offset by reductions in red tape, saving double those costs. The “one-in, two-out” rule imposes Whitehall departments, applying to all domestic regulation affecting businesses and voluntary organisations. The “one-in, one-out” rule, which required the costs of new regulation to be matched by savings of an equivalent amount, will be replaced.

2. Amount of a week’s pay and statutory guarantee pay increased

The maximum amount of week’s pay used to calculate statutory redundancy payment and basic awards of compensation for unfair dismissal, increases to £450 per week. The limit on the amount of statutory guarantee pay payable to employees in respect of any day, boosts up to £24.20. For any employee whose termination date is on or after 1 February 2013, the new, calculated figure of statutory redundancy payments needs to be taken into account.

3. Increase in parental leave

Unpaid parental leave increases from 13 to 18 weeks.

4. DBS launches online update service

The Disclosure and Barring Service (DBS) launches an online update service for checks on applicant criminal records and suitability to work in regulated activity with vulnerable groups, including children. A small fee for this service means that it will no longer be necessary to apply for a new check when starting a new job or activity. DBS checks are transferable between jobs and activities, streamlining the recruitment process.

5. Changes to the Late Payment of Commercial Debts (interest) Act 1998

Aimed at combating late payment in commercial transactions, public authorities are required to pay invoices for goods and services within 30 days, extending to 60 days in some cases. Any attempt to extend the payment period beyond 60 days will be valid if not considered “grossly unfair” to the supplier. Defaulting purchasers pay interest at a rate of up to eight per cent above the Bank of England base rate, and compensation costs of not less than €40.

6. Changes to registration regime for company changes

The legislation implements a single UK-wide scheme that applies to all companies and Limited Liability Partnerships (LLPs), becoming relevant to all company directors, company secretaries, and partners of LLPs. The new regime becomes law on 6 April 2013, streamlining the registration process.

7. Changes to statutory maternity, adoption and paternity pay

Effective from 7 April 2013, the standard rate of Statutory Maternity Pay, Statutory Adoption Pay and Statutory Paternity Pay rises from £135.45 to £136.78 per week.

8. Changes to the safety inspection process

The government introduces binding new rules on both the Health and Safety Executive (HSE) and on local authorities. This exempts hundreds of thousands of businesses from burdensome, regular health and safety inspections. In future, businesses only face health and safety inspections if operating in higher risk areas such as construction, or if they have an incident or a track record of poor performance.

9. Changes to the current Reporting of Injuries, Disease and Dangerous Occurrences Regulations 1995 (RIDDOR ’95) process

The Health and Safety Executive (HSE) makes requirements under the RIDDOR ’95 easier to understand and comply with. These changes make it easier for businesses and other users to understand what they need to do to comply with health and safety law.

10. Employee-shareholder contract introduced

Employers offer a new type of employment contract, under which an employee will give up some of their employment rights in exchange for between £2,000 and £50,000 shares in their employer’s company, exempt from capital gains tax.

11. Fees for bringing employment tribunal claims introduced

Employees who bring a claim before an employment tribunal will be required to pay a fee. Currently, there is no charge for bringing an employment tribunal claim. The government’s stated aim for introducing a fee scale is to reduce the cost to the taxpayer of running the tribunal system.

12. Young people required to continue in education or training

From summer 2013, young people will be required to continue in education or training until at least the end of the academic year in which they turn 17.

13. Consumer Rights Directive

The EU Council approves the Consumer Rights Directive. It aims to simplify existing rules on consumer protection for distance contracts and contracts negotiated away from business premises. A more competitive and consumer-friendly internal market is promoted. The Directive has to be implemented into UK law by the end of 2013.

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