Employment law changes: What’s coming up?
As part of the Good Work Plan, a number of changes to employment legislation will take effect from April 2020 and beyond.
At the end of last year, the government published the ‘Good Work Plan’ which was a result of the recommendations proposed in the Taylor Review of Modern Working Practices in July 2017. The Good Work Plan has been described as the governments ‘vision for the future of the UK labour market’.
As part of the Good Work Plan, a number of changes to employment law will take effect from April 2020 and beyond.
Changes taking effect in April 2020
1 April 2020
Increases to National Living Wage and National Minimum Wage
The National Minimum Wage (Amendment) Regulations 2020 amends minimum pay rates from 1 April 2020 as illustrated in the following table:
|Hourly payments||April 2019||April 2020|
|National Living Wage ( Workers ages 25 and over)||£8.21||£8.72|
|National Minimum Wage|
|Workers ages 21-24||£7.70||£8.20|
|Workers ages 18-20||£6.15||£6.45|
|Workers ages 16-17||£4.35||£4.55|
6 April 2020
Extension of the right to a written statement of particulars
Employers are required to give employees a written statement of the particulars of their employment when they start work. From 6 April 2020 This should now be given by Day 1 of employment rather within two months of employment as previously. This requirement has been extended to include all workers, rather than just employees.
The statement must outline: the days of the week the employee is expected to work; whether days or hours are variable; any benefits provided by the employer; probationary period details; and any training requirements.
Increase in the period over which holiday pay is calculated
The reference period used to calculate a ‘week pay’ will be extended in response to the Good Work plan. Currently the holiday pay of a worker is calculated by averaging hours over a 12-week period. This is known as the pay reference period. This pay reference period will now be extended to 52 weeks, or for those workers that have worked less than 52 weeks, the total number of complete weeks that they have worked.
Increased protection for Agency workers
Under the current guidance, agency workers are entitled to be paid at the same rates as permanent employees after a 12-week period, unless The ‘Swedish Derogation’ principle applies. This principle currently allows employers to avoid pay parity (after 12 weeks) if certain conditions are met. From April 2020, this will be abolished and by no later than 30 April 2020, employers must provide agency workers whose contract contains this provision, a written statement clarifying that this provision no longer applies.
Agency workers should also be provided with a Key Information document, which includes information on the type of contract they are on, pay rates and pay arrangements.
Parental bereavement leave
All employees to who lose a child under the age of 18, or suffer a stillbirth after 24 weeks of pregnancy, will be entitled to two weeks’ statutory leave. This can be taken as one block or two non- consecutive separate blocks of a week, at any time during the 56 weeks following the child’s death. Those employees that have at least 26 weeks’ service and who meet the minimum earnings criteria will also qualify for Statutory Parental Bereavement Pay. This will be paid at the same rate at Statutory Paternity Pay.
All termination payments above £30,000 will be subject to class 1A National Insurance Contributions (NICs). The Class 1A liability will only apply to the amount of payment exceeding £30,000.
Changes to ICE Information and Consultation of Employees) Regulations
Another change coming into force on 6 April 2020 will be the lowering of the threshold for employees to request an information and consultation agreement. Currently at least 10% of the workforce must make a request before an employer has to comply however this percentage is being reduced to 2%. However, it still remains that at least 15 employees must make the request.
The Department for Work and Pensions announced that there would be increases to statutory payments in April.
There will be annual increases to various statutory compensation limits. This will include the maximum amount for a week’s pay (used when calculating statutory redundancy payment) and the maximum compensation for unfair dismissal cases.
These changes are illustrated in the following table:
|Weekly payments||April 2019||April 2020|
|Maternity/Paternity/Adoption/Shared Parental Pay||£148.18||£151.20|
|Compensation payments||April 2019||April 2020|
|Maximum limit on week’s pay||£525||£538|
|Maximum compensatory award for unfair dismissal||£86,444||£88,519|
|Minimum basic award for certain unfair dismissals (dismissals for reasons of trade union membership or activities, health and safety duties, pension scheme trustee duties, or acting as an employee representative or workforce representative)||£6408||£6562|
In respect of claims presented on or after 6 April 2020, the Vento bands will increase as follows:
- Lower band: £900 to £9,000 ( This will be for less serious cases)
- Middle band: £9,000 to £27,000 ( This will be for serious cases, but not appropriate for an award in the upper band)
- Upper band: £27,000 to £45,000 (This will be the award for the most serious cases)
Changes coming into effect but with no set date:
Workplace sexual harassment
Proposals include introducing a duty to prevent harassment in the workplace, re-introducing protection against third-party harassment and an extension to the time limit from 3 months to 6 months for bringing a workplace discrimination or harassment claim. A consultation on these issues ran until 2 October 2019 and a response is expected in Spring 2020 (although this may be delayed due to current disruption).
Increase in the ‘break of service’ period
At present, a gap of one week or more between periods of work is sufficient to break continuity of service in most situations (with some exceptions where legislation outlines that continuity is preserved for longer period such as redundancy).
The government is committed to extending the gap in employment from one week to four weeks, although there is no set date for these changes to be implemented.
Right to request a ‘stable’ contract
The government also intends to legislate to introduce a right for all employees and workers to request that their working pattern become more stable. This would be subject to a service requirement of at least 26 weeks.
No set date for changes to come into effect
In October 2018, the Government said that it would consider creating a duty for all employers to assess whether a job can be done flexibly.
The proposals under consideration include establishing a right to reasonable notice of working hours, the right not to suffer any detriment for refusing work offered as unreasonable notice and also the right to compensation when shifts are cancelled without providing reasonable notice.
New enforcement body
Following the Good Work Plan, the government is considering proposals to establish a single labour enforcement body, with a national remit, to ensure better protection for vulnerable workers.
Management of tips
This has been a topic for discussion in previous consultations. However legislation has now been proposed to require all employers to pass on tips/service charges to workers to ensure that these tips are distributed fairly.
Pregnancy and maternity discrimination: extending redundancy protection
The government has previously announced an intention to extend the period of redundancy protection for pregnant women and new mothers. Protection will be in place from the point in which an employee notifies their employer of their pregnancy until 6 months after the end of their maternity leave. This notification can be given in writing or orally. There is no set date for this change to come into effect.
IR35 delayed until April 2021
It was announced on 17 March 2020, that the rollout of changes to the off-payroll working rules (known as IR35) has been postponed until 6 April 2021, in direct response to the coronavirus pandemic. From that date, the responsibility for determining whether the off-payroll working rules apply will move to the organisation receiving an individual’s services.
Ingrid McGhee is a Partner in the Employment, Pensions and Immigration Team at Weightmans LLP and is based in Glasgow. If you have any questions, please do not hesitate to contact Ingrid at ingrid.mcghee@weightmans,com or speak to your usual Weightmans advisor.