Changes to Employment Law in 2020
Following the General Election in December 2019 the Government has been busy putting into place plans set out in their manifesto. The manifesto, published on 24 November 2019, pledges to support working families, to reduce inequality in the workplace and to improve the rights of low-paid and casual workers.
A number of legislative changes relating to Employment Law are due to come into force on 06 April 2020. We have outlined the headlines of these 2020 employment law changes below.
Written Statements of Particulars of Employment
At the moment employers must provide employees with a written statement of particulars of employment within 8 weeks of their employment commencing. From 06 April 2020 this right will be extended to workers as well as employees and employers will be required to provide such statements on or before the date upon which employment starts. The statement, referred to as the Principal Statement, will need to cover the previous Section 1 requirements and also now the following:
· the days of the week the worker is required to work, whether the working hours may be variable and how any variation will be determined;
· details of any other benefits provided by the employer;
· any probationary period, including any conditions and its duration; and
· any training entitlement provided by the employer, including whether any training is mandatory and/or must be paid for by the worker.
Particulars relating to incapacity and sick pay, paid leave, pensions and any training entitlement provided by the employer may be contained in another reasonably accessible document (e.g. a staff handbook of policies and procedures), rather than being set out in the Principle Statement, but the fact that the employer has chosen to do so must be referred to in the Principal Statement itself.
Recommendation: You should review your recruitment practices to ensure that you are able to provide a written statement of particulars at the commencement of employment. If you intend to comply with the legislation by providing a Principal Statement and follow this up with a later Contract of Employment, we recommend you take advice to ensure that you meet the requirements in both documents.
Parental bereavement leave
The Parental Bereavement (Leave and Pay) Act 2018 will come into effect in April 2020. Under the new law, parents who lose a child under the age of 18, or suffer a stillbirth after 24 weeks of pregnancy, will be able to take leave as either a single block of two weeks, or as two separate blocks of one week each across the first year after the death.
This right to leave applies to all employees regardless of length of service. Employees who have at least 26 weeks’ service, who meet minimum earnings criteria, will also qualify for Statutory Parental Bereavement Pay (at the same rate as Statutory Paternity Pay).
It has been indicated that employees would have up to 56 weeks from the date of death (or stillbirth) to use up their leave entitlement.
Recommendation: You should review your handbook to consider whether any existing leave or bereavement policies need to be updated in light of this new entitlement.
The reference period for determining a worker’s average weekly pay (for the purposes of calculating holiday pay) will be extended from 12 weeks to 52 weeks; or, if the worker has been engaged for less than 52 weeks, the total number of weeks the worker has been engaged for.
This change will be applicable to periods of holiday from 06 April 2020 onwards.
Recommendation: You should consult with any staff whose leave is currently calculated using a different reference period. If you would like a draft consultation letter dealing with this issue then please contact a member of the Employment Team.
The “Swedish derogation” in the Agency Workers Regulations 2010 (which currently allows employment businesses to avoid pay parity between agency workers and direct employees if certain conditions are met) will be removed from 06 April 2020.
Temporary work agencies must provide agency work-seekers with a Key Information document, including information on the type of contract, the minimum expected rate of pay, how they will be paid and by whom.
By no later than 30 April 2020, temporary work agencies must provide agency workers whose existing contracts contain a Swedish derogation provision with a written statement advising that, with effect from 6 April 2020, those provisions no longer apply.
Recommendation: If you would like to discuss the preparation of a Key Information Document or a written statement in relation to Swedish derogation, please contact a member of the Employment Team.
Where an employee works for a large organisation (with at least 50 employees) they, within a group of colleagues, can ask their employer to keep them informed and consult with them on issues related to the company or organisation that employs them.
This may include:
· the company or organisation’s performance, for example financially and competitively
· any changes to working conditions and employment prospects
This is called an information and consultation agreement.
From 06 April 2020 the threshold of the number of employees required to request an information and consultation agreement under the ICE Regulations will be lowered from 10% to 2% of employees, subject to the existing minimum of 15 employees.
From 06 April 2020 all termination payments above the £30,000 threshold will be subject to class 1A NICs.
Recommendation: Employers seeking to make termination payments that exceed the £30,000 threshold will need to provide for the contribution to be made.
The off-payroll working rules will be extended to large and medium-sized companies in the private sector, as announced in the Autumn 2018 Budget. In short, the rule provides that all payments made to personal service companies will be treated as payments of employment income on which the client (or a third party intermediary) must account for tax. In effect, this will shift responsibility for IR35 tax compliance away from the personal service company to the client or intermediary. At present, there is a government review into the implementation of these changes, which is expected to close this month. We will update you as to the outcome of that review and how the forecast changes may be affected.
Recommendation: If your business contracts with a personal service company, please contact us for specialist advice as to how these changes may affect you.
For more information and advice regarding the upcoming employment law changes, please get in touch using the form below.