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Employment Law

February's Employment Law Update

The Employment Rights (Increase of Limits) Order 2011

On 1 February 2012 the annual uprating of employment tribunal limits took place. The upper limit on a week’s pay for redundancy payment and basic unfair dismissal award purposes rises to £430 from £400. That means that making employees with two years’ service and annual earnings over £20,800 redundant on or after that date will be more expensive. There is also a significant increase in the maximum compensatory award for unfair dismissal, from £68,400 to £72,300.

Updates for European Employers

Minimum wage introduced for temporary workers in Germany

Germany has introduced a statutory minimum wage for temporary workers, effective from January 1 2012. The rate is €7.89 p/hr in Western Germany and €7.01 in Eastern Germany. This will be increased to €8.19 and €7.50 respectively from November 1 2012.

Qualifying salaries for work permits in Belgium/Netherlands

Both Belgium and the Netherlands have introduced new salary requirements for work permit applications which apply from January 2012. In Belgium the minimum annual salary required to get the ‘B type’ work permit has increased to €37,721 and to €62,934 for executive and senior management positions. In the Netherlands, the minimum required annual salary for highly skilled workers from non-EEA countries is €51,239 for those over the age of 30, €37,575 for applicants who are younger than 30 years, and €29,931 for foreign graduates from a Dutch institution of higher education.

Social security changes for 2012 in France

The French law on the financing of social security for 2012 has been published in the Official Journal. There are a number of important changes to note this year:

• The rate of the so-called employer ‘forfait social’ contribution is increased from 6% to 8%.
• The social security scheme applicable to severance payments has been amended in respect to the termination of corporate officers, senior managers and persons referred to in Article 80 of the General Tax code. The nontaxable share excluded from social security contributions now has an upper limit of €72,744.
• The rate of abatement for business expenses has been reduced. The automatic deduction is now set at a fixed rate of 1.75%.
• There are also changes in the way that the “fillon reduction” is calculated for employees on low incomes.

(Source, FedEE)