Employment Law Update - January 2025
With news of employment reforms in 2024 being dominated by the Employment Rights Bill, we are now expecting to see further reforms being drafted and announced in 2025.
News ??
The Draft Equality (Race and Disability) Bill
Announced in the King’s Speech 2024, this Bill promises to ensure the right to equal pay for ethnic minorities and disabled people. Specific equal pay law already exists in relation to gender, and gender pay gap reporting is required by companies with 250 or more employees. The draft Bill sets to mirror these provisions, such that employers (again with 250 or more employees) will be required to report on the ethnicity and disability pay gap.
Large employers will need to begin to prepare resources and processes to facilitate reporting, and all employers will need to be mindful when considering pay practices, including pay reviews. The risk otherwise is that they will face the prospect of being a party to litigation, which we can see is still rife in the high-profile equal pay claims based on gender, for example Thandi v Next Retail Ltd, which we reported back in our September 2024 issue.
Implementation of further family-friendly rights
Having been given Royal Assent under the previous Conservative government, the Neonatal Care (Pay and Leave) Act was due to come into force in April 2025. This date has not been confirmed, but likewise no revised commencement date has been given.
Under this new Act, parents would have a right to additional time off of up to 12 weeks above and beyond their statutory maternity or paternity leave entitlement or shared parental leave entitlement, when a child is born requiring neonatal care.
The Act was given Royal Assent at the same time as the Carer’s Leave Act (which came into force last year). Companies will need to keep an eye for progress with implementation of the neonatal pay and leave legislation, once the new law does come into force, will need to amend any family-friendly policies to incorporate a neonatal care policy.
Also in the sphere of family-friendly rights, the Women and Equalities Committee has published a report recommending that the Employment Rights Bill should include provisions for parental bereavement leave to be available to parents who suffer pregnancy loss before 24 weeks, who currently do not receive any statutory protection.
New practices for holiday pay
Under amendments to the Working Time Regulations 1998, rolled up holiday pay can now be paid to irregular hours (e.g., zero-hours workers) and part-year workers.
These rules came into effect on 1 January 2024 but were only applicable for holiday years starting on or after 1 April 2024. Therefore, any employers with a holiday year running from 1 January to 31 December (for example) will now be able to apply these new rules starting on 1 January 2025, so they may be in a position where amendment of employment contracts and/or or staff handbook policies is needed.
If rolled-up holiday pay is implemented, employees do not receive any pay whilst they are on holiday. Instead, employees receive an additional 12.07% of pay for their holiday entitlement as part of their normal pay during the weeks in which they are working, although this will need to be expressly set out on payslips.
Case Law Update ??
HSBC Bank plc v Chevalier-Firescu
?The Claimant applied to work at HSBC Bank, and was rejected in July 2018 for having a received an adverse reference from a previous employer, Barclays. The Claimant had been engaged in sex discrimination proceedings against Barclays at the time but had no evidence that those proceedings were the reason for the bad reference.
After receiving disclosure following a data subject access request in August and September 2020, however, the Claimant learned that she had been a very strong candidate for the role at HSBC, but that a senior manager had heard about her sex discrimination proceedings, and had provided negative feedback to the interviewer. This led to the Claimant bringing claims against HSBC in 2020. These claims were struck out in the Employment Tribunal for being out of time, as the decision not to appoint was made in July 2018 (therefore far outside the time limit to raise a claim).
This decision was overturned by the Employment Appeal Tribunal, whose decision was subsequently upheld by the Court of Appeal. Both courts agreed that the Tribunal had not taken into account the fact that the Claimant had only learned of the information supporting her claim in 2020, and that the information had been important to the prospects of her claim.
Jones v Secretary of State for Health and Social Care
Again, regarding time limits, the Court of Appeal was involved in an appeal whereby both the Employment Tribunal and Employment Appeal Tribunal had refused to extend time for an unsuccessful job applicant to bring his claim.
The applicant, Dr Jones, had only received feedback on his application (as to the age and race of the successful candidate) after the relevant time limit had passed.
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However, the Court of Appeal overturned the refusal, arguing that knowing the ethnicity and age of the successful applicant was essential to the Claimant’s claim, and that upon receiving this information, the Claimant then had far greater evidence to justify issuing his discrimination claim at that time.
British Council v Sellers
In this case, the Claimant had been accused of sexual misconduct, for which he was dismissed. In the Employment Tribunal, it was decided that he had been unfairly dismissed because of a lack of reasonable investigation, which was not rectified at the appeal stage. This led to the employer instructing an independent investigator to review their decision to dismiss, and to come to a finding. The investigator’s finding was that the Claimant had committed misconduct.
When the claim got to the subsequent remedy hearing, the Claimant applied for re-engagement (i.e., to return to the Company’s employment, but to work in a different role). This was opposed by the employer, who argued that, due to the true concerns about the Claimant’s conduct, it was impracticable to re-employ him. The Tribunal ordered re-engagement, finding that it was not in fact impracticable to re-engage.
The EAT overturned this decision, on the basis that practicability needs to be determined from the employer’s perspective, particularly in light of the company having received a result from an independent investigation that the Claimant had committed misconduct.
This is another case that demonstrates that re-instatement and re-engagement really are rarely awarded remedies, and that isn’t likely to change. Where an employer truly believes that an employee is guilty of misconduct, to the extent that mutual trust and confidence has broken down, re-engagement is simply not likely to be ordered.
Upcoming Event ??
Pay, Recruitment and Employment Law : What Every Employer Needs to Know
Join us in Peterborough on 5th Feb for our live conference covering all things Pay, Recruitment and Employment Law.? With a panel of experts, great networking opportunities and insight into the latest developments for HR professionals it’s a great opportunity for you and your team to get up to speed for 2025.
Full details can be found here.
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