Employment Law Round Up – What’s on the cards?

I have provided a summary below of the employment laws currently in the pipeline or being considered by the current Government, but have also included some changes at the end of the update that the Labour Party has indicated they might introduce if they were to win the next General Election (as mentioned at their October 2023 Conference).

New Employment laws typically go live in either April or October each year. I will be keeping an eye on all of this and will confirm any contract and policy changes that need to be made once the start date of any new legislation is confirmed.

So here we go, in no particular order……

     

      1. National Living Wage increase from April 2024 – It has been indicated that the National Living Wage may increase to over £11 per hour based on the Low Pay Commission’s recommendations. Exact details are expected to be confirmed this month. To be clear, the National Living Wage:

       

        • is the highest rate of the National Minimum wage (currently £10.42 an hour)

        • must be paid to all workers over the age of 23.

         

          1. Retained EU Employment Laws, 31 December 2023 – In theory, the Retained EU Employment Laws come to an end on 31st December 2023, although we do not yet have confirmation of what this will mean for employers. It is understood that the UK will continue to apply current EU laws until any new, specific laws are passed.

           

            1. Workers Predictable Terms and Conditions – The purpose of this new legislation is to give workers and agency workers the statutory right to request more predictable terms and conditions of work, such as their role / the work that they do and their work pattern / days / hours of work (although they will not have the automatic right for their request agreed). There may be a qualifying period before a request can be submitted, but that hasn’t been confirmed.

             

              1. Flexible Working – It is proposed that it will become a Day 1 right (currently a 26 week qualifying period) to request variations to particular terms and conditions of employment eg working days / hours / times. Other changes:

               

                • A requirement for employers to consult with an employee before rejecting a flexible working request

                • Employees can to make two statutory requests in any 12-month period (currently 1)

                • Decision period for employers is reduced from three months to two months

                • Removes the requirement for the employee to explain in their request, what effect the change would have on the business and how that impact might be overcome.

                 

                  1. Statutory Holidays – Statutory, minimum holiday entitlements for employees are currently 20 days (under EU law) plus 8 public / bank holidays (under UK law). It is being proposed that this is simplified and that these are combined into one statutory UK entitlement of 28 days.

                   

                    1. Pensions Auto-enrolment – This will extend pension auto enrolment to those under the age of 22 and may also scrap the minimum earnings qualifying level, so that pension contributions are based on earnings from £1 upwards. 

                     

                      1. Rolled-up holiday pay – It is currently illegal for Zero Hours,  Irregular Hours and Term Time workers to have their holiday pay spread over the year by adding an amount (eg often 12.07%) on top of their weekly / monthly pay (often referred to as “rolled up holiday pay”) or to save any holiday pay in a pot for the worker to draw down upon request. The required holiday pay calculation process is now quite clunky (further details here: IMPORTANT: Contract amendments required for Zero Hours, Irregular Hours and Term Time workers ). The good news is, this process is under review, with the potential outcome being that employers may be able to pay ‘rolled-up’ holiday pay again in accordance with new guidelines.

                       

                        1. Maximum working hours and record keeping – While there is currently no mention of removing the current limits on average weekly working hours (ie unless the employee has opted-out of the Working Time Regulations 1998 in writing, they must not work more that 48 hours per week, averaged over a 17 week period) there are new proposals to potentially remove the requirement of employers to maintain records showing the average time of each worker. 

                         

                          1. Non-Compete Clauses – It is being proposed that non-compete clauses in employment contracts should be restricted to three months post-termination, meaning that some Restrictive Covenants may become unenforceable. It may therefore be wise to have “garden leave” in all employment contracts, meaning that employers can require an employee to stay away from the workplace during their notice period, minimising their access to company information, systems etc that could potentially put the business at risk, for example, of clients being poached or similar. 

                           

                            1. Carer’s leave – This is proposed to be available from Day 1 of employment, providing carers with the statutory right to take up to one week’s unpaid leave per year (either taken in one go or over a number of periods) to provide care for a relative or dependant.

                             

                              1. Protection from Redundancy – Pregnancy and Family Leave – These proposals are designed to provide further redundancy protections to employees during or after pregnancy, maternity, adoption, or shared parental leave.

                               

                                1. Worker Protection – Sexual Harassment – These changes aim to make employers take all reasonable steps to prevent sexual harassment in the workplace and it also suggests an increase in the compensation payouts for sexual harassment cases where the employer has breached their duty. 

                                 

                                  1. TUPE (Transfer of Undertakings, Protection of Employment). TUPE Regulations apply when an organisation, or part of it, transfers from one employer to another, or when a business service transfers to a new provider (eg when another company takes over the contract for office cleaning). Under current procedures, employers are required to consult with employee representatives if 10 or more employees are going to be affected by a business transfer. The new proposal is to allow employers to consult with employees directly (rather than have to elect representatives) for businesses with fewer than 50 employees and where the transfer affects less than 10 employees.

                                   

                                    1. Allocation of Tips – This new law will make it compulsory for businesses in the hospitality, services, and leisure sectors to pass on all tips to their staff.

                                   

                                  In addition, Monitoring at Work – Please be aware that the ICO has updated its guidance on the monitoring of employees in the workplace and provide a checklist of the things you need to consider before implementing anything: Monitoring-workers

                                   

                                  Labour Party – Proposed Reforms

                                  The Labour Party has suggested that they may make the following changes to Employment Laws if they win the next General Election, although have not confirmed all of the finer the details:

                                  1. Day 1 Rights Some basic rights, currently only available to employees, may be extended to all workers with effect from day 1. They have cited examples such as unfair dismissal (currently can only be claimed after 2 years of employment), statutory sick pay (proposing increases in payments) and maternity / parental leave (which generally only apply after 26 weeks of employment at the moment). 

                                  2. Employment Tribunal Claims – It is being suggested that:

                                    • The current 3 month time limit for workers to bring a claim may be extended, but there has been no indication of how long it will be extended to.

                                    • The payout limits on some types of claim being scrapped, therefore making potential compensation awards unlimited.

                                  3. Zero Hours Contracts – These types of contracts may be completely banned.