Legal changes for pubs to look out for in 2024

National living wage​

A rise in the national living wage (NLW) will come into force on 1 April 2024 after Chancellor Jeremy Hunt announced it in his Autumn Statement in November last year.

This means any staff members employed on the lowest rate that is the national living wage will see their hourly pay go up from £10.42 to £11.44.

This represents a 9.8% hike in outgoings for pub operators and pubcos and an employee on the NLW will receive an average yearly pay increase of about £1,800.

The £1.02 lift is the first time the NLW has risen by more than £1.

Meanwhile, operators need to be aware the NLW will be extended to 21 and 22-year-olds, fulfilling a recommendation the Low Pay Commission first made in 2019.

The 18 to 20-year-olds rate rises by £1.11 to £8.60, and the 16 to 17-year-olds and apprentice rates both rise by £1.12 to £6.40.

When Hunt took to the House of Commons​ to reveal what was in his red briefcase for the NLW, he said: “People who get up early, put in the hours and work hard for their families deserve to be paid fairly.”

He stated that since 2010, the NLW hourly wage has risen from £5.80 to £10.42, which represented a 20%-plus increase and, because the tax threshold had also risen, pay for workers is actually up by 25%.

Tipping​

Legislation in the form of the Employee (Allocation of Tips) Act 2023​ means hospitality businesses must pass on 100% of gratuities received from customers without deductions.

However, the introduction of the legislation, which received Royal Assent in spring 2023​​, has been postponed until 1 July 2024 but this could change if the Prime Minister calls for a general election this spring and parliament gets dissolved because it won’t be able to approve the final code of practice.

This ruling was first announced in Government more than eight years ago and when it finally comes into force, it includes a requirement for all tips to be distributed by the end of the month after they were received.

On its introduction, it has the backing from the Labour Party when it went through parliament previously so if Labour were to win the general election, whenever that takes place, it is likely to come into force shortly afterwards.

The Government published the draft of the Code of Practice just before Christmas last year, and there has been a consultation on the new code, which ended in February.

It is expected that Government will respond to the consultation shortly after Easter then it will ask parliament to approve the final version of the code.

Business rates​

Chancellor Jeremy Hunt failed to maintain the freeze on business rates rising at his Spring Budget​ on 6 March 2024 so hospitality sites will see this tax go up beginning on 1 April.

Despite those in the pub sector pleading for reform of business rates and, at least, wanting a further freeze on rates, Hunt made no mention of business rates meaning the prices have to go up for those operating businesses with rateable values of £51,000 and above.

In November last year, Hunt froze the small business multiplier at 49.9p but opted to uprate the standard multiplier by last September’s CPI inflation rate of 6.7%.

Accordingly, the non-domestic standard rating multiplier in England of 51.2p for 2023-24 will increase to 54.6p from 1 April for 2024-25.

Experts claim companies will face the biggest year-on-year increase to the standard multiplier since 1991.

Pavement licences​

One positive to come from the pandemic was that the application process for putting tables and chairs outside hospitality venues​ was streamlined thanks to the Business & Planning Act.

It allowed swift approvals through a prescribed form of application and a fee. The act also did away with the need to obtain planning permission for outdoor seating where a pavement licence is granted.

However, although the pavement licence regime has been extended a number of times, the extension currently runs until 30 September 2024 when it will be reviewed again.

Off-sales​

Also, under the Business & Planning Act that was introduced during Covid, is the ruling that premises licences granted on or before 22 June 2020 that only permit the sale of alcohol for consumption on the premises were granted temporary permissions to sell alcohol for off-site consumption​.

This has allowed smart pub and bar operators to increase sales to people wishing to take alcoholic beverages away with them.

However, licensing solicitor Poppleston Allen warned operators must check the rules carefully before relying on the easement because there are certain conditions that must be met in order for a premises to benefit.

As things stand, this easement will continue until 31 March 2025.

Temporary event notices (TENs)​

During and post-Covid, the number of Temporary Event Notices (TENs) pubs could apply for to allow licensed sales outside individual pubs’ permitted hours were extended for 2022 and 2023.

However, at the start of 2024, these limits have now reverted back to their original maximums which are, for any calendar year:

• No more than 15 TENs per premises
• The maximum aggregate number of days those TENs can cover is 21.

Martyn’s Law​

Martyn’s Law – otherwise known by its official title as the Terrorism (Protection of Premises) Bill, featured in the King’s Speech, which Charles III delivered in November last year.

The bill will impose requirements for hospitality sites and events, among others, to increase their preparedness for, and protection from, a terrorist attack by requiring them to take proportionate steps, depending on the size and nature of the activities that take place at the premises.

A public consultation the Government promised regarding the Standard Tier (public capacity of 100 to 799) does not close until 18 March 2024 so the bill will not be laid before parliament until after that date. 

It is unlikely to be introduced this year and could come into force within the next two or three years.