Changes to employment law
When it comes to employment law, things are getting rather tasty at the moment! The new Government is currently dealing with various matters, including several left over from the previous Government.
This article builds on the previous one about Changes coming down the pipeline.
Tips
The Code of Practice of Fair and Transparent Distribution of Tips is due to come into force on 1 October, together with the remaining parts of the Employment (Allocation of Tips) Act.
This affects you as a consumer giving tips as well as employers in the hospitality and beauty industries, for example.
Sick leave
A pilot scheme was due to start, in about 6 regions, for a new WorkWell scheme to manage Statutory Sick Pay (SSP) in the UK.
If the pilot was successful, it was intended to be rolled out nationally as a reform to the existing Fit Note scheme, but it remains to be seen whether the new Government will go ahead with it.
Equality Act
We know from Labour manifesto pledges and recent announcements that the previous government’s Worker Protection (Amendment of Equality Act 2010) Act 2023 is likely to come into force as expected.
This imposes a mandatory duty on employers to take reasonable steps to prevent sexual harassment of their employees.
Making work pay
Other pledges were published in a May 2024 document called Plan to Make Work Pay.
It contained a menu of changes the new Government promised to make to the employment landscape, including:
A key change is that of “Day 1 Rights”. It’s proposed that new employees obtain some key legal rights from Day 1 following their probationary period, including:
Currently, it takes much longer to acquire those rights, for example, they must be employed for two years before an employee can claim for unfair dismissal.
Worker status
Another proposal currently on the cards is the change of three categories to two.
At the moment, people who work for your business can be:
‘Worker’ is a hybrid category in terms of legal rights and protection.
The proposal is that there is a single status of “employed person” which does away with the difference between employee and worker, thus increasing the protection available to those people currently categorised as “worker”. I understand the new unified category may be named “worker”.
Redundancy consultation
There’s a proposal about changing the way numbers are counted to trigger the right for group redundancy consultation (which is also relevant to business transfers under TUPE).
Currently, if you’re making 20 or more employees redundant from the same business unit or site, or transferring a business unit to a new owner, a consultation should take place between the company, the affected staff, and their representative.
Below that headcount benchmark, you can negotiate redundancies on a one-to-one basis without having to do a group consultation.
Until now, the headcount benchmark has been applied to a particular site, so that an employer working on say 30 redundancies across several sites or functions may not be required to undertake consultation.
The proposed changes would mean that the headcount benchmark would be measured not by site or unit, but by reference to all those across the business that may be impacted. So, an employer looking at redundancies that potentially impact more than 20 people across the business will need to provide the affected workforce with consultation, even if the total number of affected employees are spread across a number of sites and on the current site-by-site basis would not trigger consultation.
Taken in tandem with the proposed reclassification of some people currently considered “workers” and not employees, this could draw a lot more employers into such consultation procedures when reorganising their businesses.
This means that benchmarks for consultation will apply across the whole business – even if it’s as big as Amazon. You’ll be compelled to consult when the total number of employees potentially impacted by your redundancy plans is above the benchmark, no matter where they work.
Gender pay gap
The Labour party believe the gender pay gap isn’t being closed quickly enough, so they propose to introduce measures to:
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Other proposals
Here are just a few of the other proposals currently up for discussion.
Right to switch off
The proposal is that employees have a right NOT to be bothered during non-working time. As I am sure you have seen/ heard, this proposal has received a lot of media air-time
Ban exploitative zero-hours contracts
Anyone working part-time will have a minimum level of stable hours and a reasonable notice of shifts they’re required to work
Reform Apprenticeship levy
This will be changed or scrapped and replaced with a structure to focus on skill
Improve the National Living Wage (NLW)
It’s intended to make this less discriminatory by removing the age bands which are currently providing different statutory minimum wage levels to employees and workers between 18-20 years of age compared to those who are 21+. The new NLW will apply to everyone over 18. Press reports also suggest an increase in the hourly rate
Ban unpaid internships
The plan is to ban unpaid internships unless it’s a clear part of a school or college course.
This should reduce a particular work inequality that has been felt particularly in the younger cohort, where people with enough financial backing can gain that all-important early experience by working unpaid, (rumour has it often in glamorous publishing/fashion sectors, but likely in most sectors, since being able to offer to work for free may have a fairly global appeal).
Meanwhile, less well-off potential candidates need an income even with their earliest jobs and cannot afford to go without pay, so are likely to miss out on the training and experience these unpaid internships provide regardless of being otherwise a good match for the role
Extend whistleblower protection
It’s proposed that women reporting sexual harassment at work can avail themselves of the existing whistleblower protections
Diversity, Equity, Inclusion (DEI)
Various initial discussions are underway on issues including gender recognition, management of harassment, and menopause – for the latter, the proposal is that employers with over 250 employees will be required to publish their action plan setting out how they will support employees through menopause, and there will be menopause guidance for smaller employers to follow.
As yet, it’s unclear how much will eventually come through as draft legislation, but inevitably, some of it will.
King’s Speech
These Bills were announced in the King’s speech:
Employment Rights Bill
This deals with zero-hours, pay and trade union issues
Equality Act Race & Disabilities Bill
Currently in draft form, this will enshrine in law the right to equal pay for ethnic minorities and disabled people, and will introduce mandatory pay reporting about relevant employee groups
Skills England Bill
This establishes a new body to bring together training functions
Digital Information and Smart Data Bill
This is intended to address updates around pre-employment checks
What this means to you
This article and the previous one are just a quick canter through some of the key headlines (there are others not included here, as it is quite a busy period for proposals and forthcoming changes).
Any or all these changes could impact your relationship with your team members (whether employees or workers) and on the contractual documents you use with them.
Watch this space for further announcements.
Meanwhile, for help with any of this (and more), please call us now on 020 3609 8764 and we will be pleased to help you.