10 years ago this month I threw both caution and a final salary pension to the wind in order to run off and create Menzies Law. I can’t quite believe it’s been that long. Perhaps that’s why it was only just before this Christmas that I finally updated my LinkedIn profile photo. What a journey it’s been: both more exciting and also more hard work than I ever could have expected.
Along the way our team (and it is very much a case of “us” and “we” nowadays, despite the previous 3 sentences) has comprised a selection of wonderful, hard-working, interesting and talented people – and it is a testament to their superb contributions that we won the prestigious award from The Legal 500 of UK law firm of the year 2018 in the category of employment law teams outside London. What better way to have kicked off our 10th anniversary celebrations?
Alongside fantastic colleagues, past and present, we of course wouldn’t have got anywhere without a large number of super clients and I’d like to thank all of you who have used our services over the years. A particularly heartfelt ‘thank you’ goes to the considerable number of loyal clients who signed up with us in January 2009 and are still our clients today: you know who you are!
To celebrate our 10th anniversary we’re going to spend 2019 giving you lots of goodies in multiples of 10. Look out for lots of 10s.
To kick things off, here are 10 hot employment law topics to look out for in 2019…
2018 saw considerable new employment legislation and case law. Employment Tribunals repeatedly ruled in favour of gig economy workers, the first Gender Pay Gap reports had to be submitted for larger businesses (stirring up a considerable new wave of equal pay claims) and of course we welcomed in the GDPR.
2019 is unlikely to be a quiet year in employment law terms for UK businesses. At the time of writing, the outcome to Brexit is in such flux we’ve chosen not to try to predict what that means for employers, but it is very much on our list…
All we can say here is prepare for all eventualities! With such enormous uncertainties as to what may happen, it would be unhelpful to say much more. Assuming we do leave the EU this year, be prepared for a significant change in business immigration laws. If we leave under a deal then it is likely that part of that deal will be little change to freedom of movement for EU workers for a couple of years. But if we have a ‘hard Brexit’ with no deal then it is likely that freedom of movement will cease immediately. If you have any EU workers on your staff, you may well need fast access to a good business immigration lawyer. If so, do get in touch with us.
2. More Gender Pay Reporting
Businesses of 250+ employees will again have to submit their GPG reports by April 2019 (based on their April 2018 payroll) (or, if you are a public sector body, reporting by 30 March 2019 based on your March 2018 payroll). The results will shine a light on whether there has been any progress on closing the Gender Pay Gap across the UK workforce since the first reports were made a year previously. Depending on the outcome, we could see more sanctions for those businesses showing poor progression or initiatives such as quotas for females on Boards if government does not get the improvements it wants. Be prepared also for an extension of the reporting rules to businesses with fewer than 250 employees some time in either 2019 or 2020.
TOP TIP: gender pay is not going away anytime soon, and employees and future employees are very interested in GPG figures. If you want to keep your employees engaged and offer a strong attraction for future staff, you have to visibly be working on decreasing your organisation’s gap. The good news is that this is one of our favourite topics at Menzies Law. Contact us to benefit from advice and information on what steps work best to address your pay gaps.
3. CEO pay ratio figures
New legislation dating from 1 January 2019, requires UK quoted companies with over 250 employees to publish the pay ratio between their CEO and their “average” employees in their annual report. This requirement will apply to a company’s financial year starting on 1 January 2019 or later. So expect these reports to start appearing from early 2020. (As legal nerds we are a little upset to see that this “over 250” threshold doesn’t match the “250 or more” threshold for GPG reporting. Yes we know it’s only one employee different, but aren’t lawyers meant to be detail-focussed?)
TOP TIP: How does the CEO ‘gap’ look in your business, even if you’re not a listed company? Set yourself apart early on by becoming a business that rewards and invests in its employees at ALL levels and not just the top slice.
4. Equal Pay claims against major supermarkets
You’ll have seen a range of equal pay tribunal claims hitting the headlines during 2018. ASDA, Tesco, Morrison’s and Sainsbury’s (and Next too) are all facing enormous equal pay claims, potentially worth billions of pounds, from female shop workers who claim that they are not paid equally to male counterparts in the distribution centres. These ‘equal value’ claims appear to have a lot going for them and are a powerful example of the risks of having ‘gender silos’ in a business. We’re expecting that, as more equal pay cases go to tribunal and the awareness of equal pay continues to grow amongst employees, there will be a continued rise in equal pay complaints and claims – which in 2018 were already 233% higher than the previous year.
TOP TIP: Don’t wait for an equal pay claim to happen. Conduct an Equal Pay Audit as soon as you can, to identify your pay gaps, know where your risks are and formulate your strategy. We have a track record in helping businesses identify their gaps and create strategies to address them. Click here for a copy of our Gender Pay Gap and Equal Pay Guide or get in touch if to discuss how we can support your business.
5. Employee and Worker rights
Another big story that is going to stay with us in 2019 is employment/self-employment/worker status and rights. The Government announced recently that that it intends to introduce a number of legislative changes in early 2019 (published as the ‘Good Work Plan’) designed to improve protection for agency workers, zero-hours workers and others with atypical working arrangements. Among other things, the Government has confirmed that it will repeal the ‘Swedish derogation’ in the Agency Workers Regulations 2010 which excludes agency workers from the right to the same pay as directly-recruited workers if they have a contract of employment with the agency.
It will also increase from one week to four weeks the period required to break continuity of employment for the purpose of accruing employment rights; give all workers the right to a ‘day one’ written statement of rights, covering eligibility for sick leave and pay and giving details of other types of paid leave; and legislate to prevent employers making deductions from staff tips.
TOP TIP: If you are in a business that regularly uses ‘atypical’ workers, ensure you know where your risks are by conducting a ‘status audit’.
We are still expecting this to remain a key topic during 2019. The three major areas where we are still advising our clients regularly on GDPR issues are:
- what lawful and specific conditions the employer should rely on when processing various types of personal data and special categories of personal data (formerly ‘sensitive personal data’);
- how best to provide privacy information to employees; and
- how to respond to subject access requests and what documents (if any) can be withheld.
We are still awaiting a revised Employment Practices Code from the Information Commissioner’s Office, which we are expecting will cover crucial areas such as processing health information or carrying out criminal records checks. It seems very odd that the ICO have so far failed to update this very important document – it’s probably an indication of just how under-staffed they are.
TOP TIP: Watch this space for further legal updates from us on these developing topics and keep an eye out for whenever the ICO updates their Employment Practices Code.
7. National Minimum Wage – increases for 2019
The 2018 budget announced a NMW increase for April 2019. The figures will be:
- from £7.83 to £8.21 per hour for workers over 25
- from £7.38 to £7.70 per hour for 21-24 year olds
- from £5.90 to £6.15 per hour for 18-20 year olds
- from £4.20 to £4.35 per hour for those over compulsory school age but under 18.
8. Auto-Enrolment pension contributions
From April 2019 minimum contributions for auto-enrolment pension schemes will increase for employers and employees. This will increase from a minimum 2% employer contribution and 3% employee contribution to a minimum 3% employer and 5% employee contribution.
9. Sexual Harassment in the workplace
Here at Menzies HQ, we have already spotted a marked increased in queries concerning sexual harassment in the workplace – from employees and employers alike. We also are involved in a number of Employment Tribunal claims which feature a harassment angle. We know that women frequently encounter sexual harassment in the workplace , but with many still choosing not to report it.
The Government announced at the end of December that they would be putting in place a new statutory code to tackle workplace sexual harassment. Even without this, we expect this to remain on the agenda during 2019 and with more high-profile cases emerging during the year.
TOP TIP: Do a risk assessment for your organisation. What is the gender split? Do you have equal opportunities training for staff/an equal opportunities statement? What is the culture like? Have you had previous complaints in the past and how have they been resolved?
10. Ethnicity Pay Gap reporting – on the agenda?
Sometimes in feels like we never stop talking about pay at Menzies Law: it’s not our fault, honest. We are simply responding to the hot employment law developments! So one that we are keeping a close eye on in 2019 is in relation to the Government’s consultation on ethnicity pay gap reporting. This consultation opened on 11 October 2018 and closes on 11 January 2019, and seeks views on ethnicity pay gap reporting from employers and other interested parties. The consultation responses will inform future Government policy, with the possibility that it may introduce an obligation on large employers to report ethnicity pay gaps in the next year or two.
TOP TIP: Definitely one to watch. Until we have more detail it is tricky to see how companies are going to be required to record and break down their figures. Until you know what the list of reportable ethnicities will be, you can’t really start gathering your data. But at this stage you should at least start thinking about what your ethnicity pay gaps may be, where they may be lurking, and what you might be able to do about them. As ever, we will be here for you with advice, an audit service and suggestions on reducing your gaps.