Employment legislation
The Good Work PlanThe Government has dubbed the Good Work Plan “the biggest overhaul in employment law in 20 years”, although it may not feel like that at the moment. However, don’t let these new changes catch you out…
More protection for agency workersFrom April 2020, the Agency Workers Regulations were amended so that agency workers with 12 weeks’ continuous service are paid the same amount as permanent staff. Holiday Pay for those with irregular hoursThe Working Time Regulations 1998 have also been amended to increase the reference period for determining an average week’s pay (to calculate holiday pay). Where a worker has been employed by their employer for at least 52 complete weeks, the reference period is increased from 12 weeks to 52 weeks. Where a worker has been employed by their employer for less than 52 weeks, the reference period is the number of weeks for which the worker has been employed. This development makes it fairer and much easier to calculate holiday pay and protects workers who work irregular hours. Increase to statutory ratesThe National Living Wage (for those aged 23 and over) and the National Minimum Wage rates change every year on 1 April. From 1 April 2021 the period that an employer must retain records sufficient to prove it is paying a worker the correct rate is now six years. The current rates are:
Statutory sick pay - from 6 April 2022
Statutory family-friendly payments - from 3 April 2022
Tribunal compensationThe annual Employment Tribunal aware limit changes effective from 6 April 2022. For cases involving dismissals, the figures apply where the effective date of termination falls on or after 6 April 2022. The maximum compensatory award for unfair dismissal will rise from £89,493 to £93,878. The cap on the compensatory award is the lower of the compensatory award limit (£93,878 from 6 April) or a year's' pay (based on the Claimant's gross salary prior to dismissal including employer pension contribution but excluding benefits in kind and discretionary bonus). There are a limited number of exceptions where the cap does not apply. These are dismissals for whistleblowing or for raising certain health and safety issues. In addition, there is no limit to the award that can be made where a dismissal is related to unlawful discrimination. The limit on a week's pay (used for calculating statutory redundancy payments and the basic award for unfair dismissal) will increase from £544 to £571 meaning the maximum basic award and maximum statutory redundancy payment increases to £17,130 (30 weeks' pay subject to the limit on week' pay). Guidelines for injury to feelings awardsAn award for injury to feelings is made to compensate for injury to feelings caused by discrimination. The award is separate from an award to compensate for financial loss and can be made even where no financial loss has been suffered. To assist Employment Tribunals, the Court of Appeal previously set out guidance for quantifying awards for injury to feelings, known as the Vento bands. The new Vento bands are as follows for any cases presented on or after 6 April 2022:
Awards over £49,300 will be made only in exceptional cases. Gender pay gap reportingAll employers with 250 or more employees are required by law to comply with gender pay gap reporting under the specific duties of the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017. Employers must report their gender pay gap data on the snapshot date each year which is 31 March for most public authoirty employers and 5 April for private, voluntary and all other public auuthority employers. Further guidance on gender pay gap reporting can be found on the gov.uk website. The gender pay gap is the difference between the average (mean or median) earnings of men and women across the workforce. IR35Changes to IR35 in the private sector - came into force from 6th April 2021. The rules shift responsibility for determining the status of a contractor for tax purposes onto the client. Post-employment notice payChanges to the calculation of Post-Employment Notice Pay (PENP) took effect from 6 April 2021 which resulted in a more consistent calculation. PENP is the amount of a 'relevant termination award' paid to a departing employee that represents a payment in lieu of all or part of their notice entitlement. It is calculated using the statutory formula, based on the employee's basic pay and the number of days (or months) in the indivdiuala's period of unserved notice (the post-employment notice period). This amount is subject to deductions for income tax and National Insurance contributions, therefore PENP can no longer be paid free of tax. Parental bereavement leaveThe 6 April 2020, saw the introduction of the new sttautory entitlement and payment of parenteal bereavement leave, aimed at supporting parents who lose a child under the age of 18 years. The Parental Bereavement (Leave and Pay) Act 2018 specifies that a 'bereaved parent' will be able to take statutory bereavement leave and applies to employees who suffer a stillbirth after 24 weeks of pregnancy, or lose a child aged below 18. A 'bereaved parent' is defined based on the employee's caring responsibilities for the child to avoid excluding those who are not the child's legal parents. Further information on statutory parental bereavement pay and leave can be found on the gov.uk website. New immigration systemThe government has published its plans for the new points-based immigration system which will apply from 1st January 2021 to both EU and non-EU migrant workers. Under the new system, all would-be Tier Two (General) migrants must speak English and will need an offer from an approved sponsor, for a role at the required skill level (i.e. a role requiring qualifications equivalent to A levels) and at the required salary. The minimum salary threshold will be set at £25,600 (with no regional variation across the UK). However, in certain circumstances, the minimum salary threshold will be reduced to £20,480. There will be no need to advertise a role and there will be no cap on Tier Two work visas. Confidentiality and NDAsAcas has published new guidance on non-disclosure agreements (NDAs). These commonly form part of settlement agreements with departing employees. This is the latest in a series of developments and, although the guidance does not have the same force as a statutory code of practice, it may be used as evidence in legal proceedings. The Acas guidance discourages the routine use of NDAs. It also states that a worker should be given a reasonable time to carefully consider the agreement and makes it clear that NDAs should not be used to stop someone from:
Details of the government’s proposed legislation on confidentiality clauses are awaited. |