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Employment law changes - preparing for April 2020
April 2019 was a busy time for employers with the gender pay gap reporting deadline and many changes coming into force including increased statutory rates and changes to payslips. Employers are likely to be grateful for a quieter few months ahead but should bear in mind that there are many more changes to come. We have detailed below the changes that will be coming into effect in April 2020 and how employers can begin to prepare for these changes.
Some of the upcoming changes have resulted from the Good Work Plan which was published in December 2018 and which has been described as the government’s “vision for the future of the UK labour market” and other changes have been proposed separately to this.
In the Good Work Plan the government made a commitment to improving the holiday pay arrangements for seasonal workers and to do this is lengthening the reference period for determining an average week’s pay from 12 weeks to 52 weeks. (Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018).
Employer’s should ensure that they keep records of employee pay for the 52 weeks prior to 6 April 2020 and continue to do so thereafter.
Statement of terms
As a result of its commitments set out in the Good Work Plan the government will be extending the entitlement to a statement of ‘written particulars’ to include workers as well as employees (Part 2 of Employment Rights (Miscellaneous Amendments) Regulations 2019). Currently employers have up to two months to issue the statement to any employee working for them for more than a month but from April 2020 the right to a statement of written particulars will become a day one right.
The information to be included in the written statement from day one is also being expanded. (Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018). In addition to the current information that must be provided, from April 2020 the statement should also include:
- how long a job is expected to last, or the end date of a fixed-term contract
- how much notice the employer and worker are required to give to terminate the agreement
- details of eligibility for sick leave and pay
- details of other types of paid leave e.g. maternity leave and paternity leave
- the duration and conditions of any probationary period
- all remuneration (not just pay) e.g. vouchers, lunch, health insurance
- the normal working hours, the days of the week the worker is required to work, and whether or not such hours or days may be variable, and if they may be how they vary or how that variation is to be determined
- any training entitlement provided by the employer, any part of that training entitlement which the employer requires the worker to complete, and any other training which the employer requires the worker to complete and which the employer will not bear the cost.
Employers should start to review their current contracts and recruitment processes to ensure that all the required information is included in contracts and that procedures are in place to ensure documentation is issued on or before the first day of work.
Extension of IR35 to private sector
Chancellor Philip Hammond announced in the Budget on 29 October 2018 that the IR35 tax rules would be extended to the private sector in April 2020.
The rules are aimed at reducing tax avoidance for off-payroll contractors working through personal service companies (PSC).
From 6 April 2020, medium and large sized private sector businesses will become responsible for assessing the employment status of the off-payroll workers they engage.
As the government reports that the cost, in terms of lost tax revenue, of non-compliance with the off-payroll working rules in the private sector is growing and will reach £1.3 billion a year by 2023/24, it is clear that change is coming, and businesses need to act now.
The government recommends that businesses affected by the proposed reform:
- look at their current workforce (including those engaged through agencies and other intermediaries) to identify those individuals who are supplying their services through PSCs;
- determine if the new off-payroll rules will apply for any contracts that will extend beyond April 2020. Businesses are encouraged to use the Check Employment Status for Tax service to do this;
- start talking to contractors about whether the off-payroll rules will apply to them; and
- put processes in place to determine if the off-payroll rules apply to future engagements.
Parental bereavement leave
In October 2017, the government confirmed its backing for a private members’ bill, the Parental Bereavement (Leave and Pay) Bill. The Bill, which became the Parental Bereavement (Leave and Pay) Act on 13 September 2018, will entitle employees who lose a child under the age of 18, or suffer a stillbirth from the 24th week of pregnancy, to two weeks’ unpaid leave, as a right from day one of their employment. The act is expected to come into force in 2020.
Employers can start to prepare by:
- Considering a written policy – Employers should consider having a written bereavement leave policy in place, as this can provide certainty and security at a difficult time.
- Being aware of religious and cultural requirements around bereavement – Employers should be aware of the risk of racial or religious discrimination claims that may arise from refused requests for time off for religious observances on death. Certain religions require a set time for mourning.
- Preparing for the possible long-term effects of bereavement – The effect of grief could manifest itself both physically and mentally, resulting in a long-term condition or illness. Employers should be mindful of this should there be a change in performance, behaviour or absence. Requests for time off or increased sickness leave should therefore be treated carefully, in the knowledge that a long-term condition could give rise to the risk of a disability discrimination claim.
- Being aware of bereaved mothers’ maternity leave rights - Employers should remember that mothers who lose a child after 24 weeks of pregnancy, or during maternity leave, will not lose their entitlement to maternity leave and pay. Rights to paternity leave and shared parental leave (where notice of leave has been given) will generally also be maintained in these circumstances.
How can we help?
If you would like further information, advice or assistance on preparing for changes to employment law due in 2020, then please do not hesitate to contact a member of our employment team.
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