It’s a lot for SMEs to take in, especially when their business wellbeing depends on legal and regulatory compliance and the consequences of breaches can be severe.
Here are some key changes businesses can expect in 2025.
New recycling regulations
From 31st March 2025 (or 31st March 2027 for micro-firms with under 10 employees), all workplaces in England will be required by law to separate their waste as follows:
- dry recyclable materials, such as plastic, metal, glass, paper and card
- food waste
- black bin waste (residual waste)
Garden waste must be managed in accordance with the waste hierarchy and recycled or composted.
Businesses and workplace premises that generate waste similar in nature and composition to household waste must follow these rules. This includes non-domestic premises, such as:
- offices
- retail and wholesale
- transport and storage
- hospitality, such as cafes, restaurants, and hotels
- places of education, such as schools, colleges, and universities
- healthcare places, such as GP surgeries and hospitals
- care homes
- charities and those registered as charities
- places of worship
- penal institutes
- charity shops selling donated goods that came from a domestic property
- residential hostels that provide accommodation to people with no other permanent address or who are unable to live at their permanent address only
- premises used only or mainly for public meetings
This list is not exhaustive.
Increases to the National Living Wage and National Minimum Wage
The National Living Wage will rise for staff over 21 years of age on 1st April 2025. The National Minimum Wage, covering workers aged 18 to 20 will go up on the same date, as will the apprentice rates and rates for workers aged under 18.
The existing and new rates can be found on the GOV.UK website. Those with rradarstation access can unlock more information on the current National Minimum Wage rates.
Changes to Employer National Insurance Contributions (NICs)
The government announced three changes to employer NICs in the 2024 Autumn Budget. These will take effect from 6th April 2025. The changes include:
- an increase to the secondary Class 1 NICs rate from 13.8% to 15%
- a reduction to the secondary threshold from £9,100 a year to £5,000 a year – the secondary threshold is the point at which employers become liable to pay NICs on employees’ earnings
- an increase to the Employment Allowance from £5,000 to £10,500 – the eligibility threshold of £100,000 will also be removed
Changes to company size thresholds
There are official turnover thresholds which determine how a business is defined and classified. For example, micro, small or medium-sized From 6th April 2025, the following changes will be made to these thresholds.
Micro businesses:
- turnover threshold increase from £632,000 to £1m
- balance sheet total (total assets) increase from £316,000 to £500,000
The monthly average number of employees remains the same at 10 employees.
Small businesses:
- turnover threshold increase from £10.2m to £15m
- balance sheet total (total assets) increase from £5.1m to £7.5m
The monthly average number of employees remains the same at 50 employees.
Medium-sized businesses
- turnover threshold increase from £36m to £54m
- balance sheet total (total assets) increase from £18m to £27m
The monthly average number of employees remains the same at 250 employees.
Changes to business rates
The rate of relief for businesses in the retail, hospitality and leisure industry will drop from 75% to 40%, up to a cap of £110,000 per business.
Businesses will qualify for the relief if they are mainly being used as a shop, restaurant, café, bar or pub, cinema or music venue, or gym, spa or hotel.
It was announced in the Autumn Budget 2024, that the:
- small business rates multiplier would be frozen at 49.9p for 2025-26
- standard business rates multiplier will be raised in line with September Consumer Price Index (CPI) from 54.6p to 55.5p
Both of these changes will be introduced in April 2025.
Updates to Companies House privacy
When a business registers with Companies House, its address can be seen by anyone visiting the website. However, from 27th January 2025, individuals have been able to hide the registered office address where it’s their home address.
From spring/summer 2025, individuals will be able to apply to hide more information from historical documents, such as:
- residential addresses in most instances when shown elsewhere on the register
- date of birth for documents registered before 10th October 2015 – those registered after this date, only publicly display the month and year
- signatures
- business occupation
Companies House intend to introduce a new identity verification process to help deter those who might want to use companies for illegal purposes.
Anyone setting up, running, owning or controlling a company in the UK will need to verify their identity to prove they are who they claim to be.
This verification process will be phased in from 25th March 2025. Individuals will be able to voluntarily verify their identity. This can be done directly with Companies House through GOV.UK One Login, or through an Authorised Corporate Service Provider (ACSP).
Ultimately, it’s intended that identity verification will become compulsory for:
- new directors and people with significant control (PSCs)
- existing directors and PSCs
- anyone acting on behalf of a company
Progress of the Employment Rights Bill
The Employment Rights Bill is working its way through Parliament. With various additions and deletions from the Bill, it is starting to look quite different from the version that was published last October. It’s not known when the Bill will become law, but wise employers will be making plans already to avoid being caught by changes to employment law. It’s expected that the Bill will include:
- ending ‘exploitative’ zero-hours contracts
- day one rights to paternal, parental and bereavement leave
- enhanced protection against unfair dismissal, removing the two year qualifying period
- an end to ‘fire and rehire’ practices in all but “exceptional circumstances”
- enhanced protection for pregnant workers and new mothers
- a single enforcement body as part of the bill, known as the ‘Fair Work Agency’
- the removal of the lower earnings limit and four day waiting period for Statutory Sick Pay
- flexible working will be introduced as a day one ‘default’ right for all workers, unless their employer can prove that it is unreasonable to do so
Those with rradarstation access can explore more about the Employment Rights Bill, including information following the outcome of the government consultations that took place recently.
Neonatal Care (Leave and Pay) Act 2023
The government has announced that this Act will come into effect from 6th April 2025. The Act aims to:
- support parents with a baby receiving neonatal care
- protect the leave and pay rights of those who have neonatal babies
- enable parents to spend dedicated time with their baby while in medical care, without using up other parental leave
Eligible parents of neonates are entitled to take up to 12 weeks of statutory paid leave within 16 months (68 weeks) of the birth in one-week increments. This is known as ‘Statutory Neonatal Care Leave’ (SNCL). SNCL is in addition to other parental leave entitlements, and is taken once other types of parental leave have ended, as long as it is within 16 months of the birth. This allows parents of neonates to take time off potentially after the baby has been discharged from hospital to bond at home.
The team at rradar, made up of highly experienced legal professionals and advisors, with many years of expertise under their belts is here to keep a watchful eye on developments in the law and package that information into easy to understand formats so you can be sure your businesses remain strong and ready to face whatever comes your way.