In December 2018, the Government published its Good Work Plan which it claims is ‘the biggest package of workplace reforms for over 20 years’. In this article we look at the legal changes that are likely to be introduced as a result and of which employers need to be aware.
The Government commissioned Matthew Taylor to review various aspects of employment law as a result of which he reported in July 2017 with a raft of recommendations on issues such as worker status, working time, holiday pay and zero hours. The Plan is the Government’s (latest) response to 51 Taylor recommendations. If implemented, these responses will have a significant impact. However, the reality is most of them are short on detail or any timescale for implementation. Here are the headline proposals of which employers will want to be aware. Most will be implemented in 2020 and we will be updating you on developments in future issues.
Itemised pay statements to be issued to workers (as well as employees): not strictly in the Good Work Plan but employers are obliged to issue pay statements (electronic or paper) to workers for all pay periods from 6 April 2019. Government Guidance has recently been published to assist employers on who is entitled to a pay slip and what it must include.
Right to written statement of terms and conditions to be extended to workers from day one: currently only employees are entitled to such a statement to be provided within the first two months. Regulations have been published which will implement this change and require additional particulars to be included in the written statement. Employers will need to amend contractual documentation in force for employees and workers who commence employment on/after 6 April 2020 to ensure legal compliance.
Changes in calculation of holiday pay: Regulations have been published providing that from 6 April 2020, the ‘reference period’ for holiday pay calculations of those with variable hours will increase from 12 weeks to 12 months or the number of complete weeks of employment. This change will be welcomed by employers as it will iron out excessive variations in holiday pay for those who receive payments such as commission and overtime. This is also an opportunity for employers to ensure they are including the correct payments in holiday pay (and a recent ECJ judgment has called into question whether overtime (particularly voluntary overtime) should be included). The Government will be launching a campaign to boost awareness of holiday pay rights and setting up an enforcement body at a future time.
Reduction in thresholds for information and consultation: to encourage work engagement, employees will be able to request an information and consultation body with the threshold requirement reduced from 10% to 2% of employees, providing at least 15 employees make the request. Regulations have been published bringing this change in from April 2020; although it is unlikely to have a significant impact on many businesses.
Repeal of the ‘Swedish derogation’ in the Agency Workers Regulations 2010: agency workers can be paid less than direct permanent employees in certain circumstances where the worker has a permanent contract of employment with their agency. Draft regulations have been published repealing this derogation so that from April 2020, all agency workers will have the right to pay parity after 12 weeks. Employment agencies and end users of agency staff will need to review their working arrangements and contractual documentation to ensure compliance.
Other changes to be made at an unspecified time
Clarification of employment status tests: although the Government has now said it will legislate to provide much needed clarification on determining employment status, it is again consulting on this issue. So for the foreseeable future we must continue to rely on any clarifications provided by case law which is of course rarely directly accessed by employers.
Extension to the period of redundancy protection for employees on maternity leave: currently these employees must be given priority for alternative employment in a redundancy situation. The Government has recently launched a consultation on whether redundancy protection should be extended for a six month period following return to work and whether this right should also be given to those (men and women) taking other forms of family leave. Consultation will end on 5 April 2019.
New right for workers and employees to request a more fixed working pattern after 26 weeks of service: staff will be able to request minimum guaranteed hours so as to have more stability. This right will have a similar procedure as the right to request flexible working.
A change in the rules for calculating continuity of employment: aimed at casual workers who do not accrue employment rights because a seven day gap in employment can break their continuity of service. From an unspecified date in the future, a four week gap in employment will be necessary to break continuity. In reality this is not just a numerical calculation as tribunals also take into account whether any gap is due to a temporary cessation of work.
If you have any questions or queries regarding the above topic or any other issues relating to Employment Law please contact your usual Morrisons adviser or Emma McLoughlin, Senior Associate Solicitor by email on [email protected]