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In order to welcome in 2020, below is a round-up of the most important employment law changes this year. You may also find our 2020 employment law timetable useful.
We’ll be covering many of these events in more detail in our future Newsletters and blogs.
The new rates are as follows:
This is the date by which all applicable organisations must publish their gender pay gap data for the snapshot date of 5 April 2019. The report must be published on the Government website and a searchable UK website that is accessible to employees and the public.
Statutory rates usually increase from the first Sunday of April. However, the rates have not yet been announced.
The maximum compensatory award for unfair dismissals taking effect from 6 April 2020 is expected to increase from its current rate of £86,444. However, the amount of increase has not yet been announced.
A week’s pay (used to calculate statutory redundancy payments and the basic award in unfair dismissal claims) is also expected to increase will also increase from its current rate of £525 (gross) but the amount of increase has not been announced yet.
We updated you in our January Blog that all workers, as well as employees, will be entitled to a written statement of terms. The Blog gives you some real detail about what you need to do as an employer.
From April, the written statement will need to be provided at the start of the employment or engagement (not within two months of starting work as is currently the case).
Statements must include a variety of new matters, including information about:
Transitional arrangements mean that updated written statements do not have to be issued to existing employees as a matter of course.
The period over which average holiday pay is calculated for employees without normal working hours, or who have variable remuneration, is being extended from 12 to 52 weeks.
The new legislation does not cover the calculation of holiday pay for workers with “normal working hours” whose pay does not vary. For these workers, case law so far has said that any calculation of what commission and overtime etc. to include in holiday pay should be based on average pay over a “representative“ period. In practice, even although the new legislation does not apply to these workers, it might result in Tribunals being more inclined to view 52 weeks as being “representative“.
The “Swedish derogation“ under the Agency Workers Regulations currently allows employment businesses to avoid pay parity between agency workers and direct employees if certain conditions are met. This derogation will be removed from 6 April 2020. Agencies must inform relevant agency workers by 30 April 2020 that it no longer applies.
In addition, from 6 April 2020 all employment businesses will have to provide agency work-seekers with a key facts statement, before agreeing the terms by which the work-seeker will undertake work. The document must be headed “Key Information Document“, be separate to any other documents provided to the work-seeker, and include specific information. Guidance on the key information document is available here.
The Information and Consultation of Employees Regulations 2004 (sometimes referred to as the ICE Regulations), are being amended to lower the threshold of employees required for a valid request to start negotiating an agreement on informing and consulting employees. The threshold is being lowered from 10% of the workforce to 2% (subject to a minimum of 15 employees).
It is still anticipated that this new right will come into effect in April 2020, but the timing has not yet been confirmed. When it does come in, it will enable parents who have lost a child to take two weeks’ leave.
For further information see our updates here and here.
Currently, many termination payments in excess of the value of the notice period qualify for a tax exemption up to £30,000. Payments that exceed this amount are subject to income tax, but no employer or employee NICs are payable.
It is anticipated that from 6 April 2020, Class 1A employer NICs are going to become due (at 13.8%) on the balance over £30,000. There will be no change as regards employee NICs.
At present, the IR35 rules apply where an individual (worker) personally performs services for another person (client or “end user”), through an intermediary (usually a personal service company (PSC)). Currently, it is the intermediary’s (PSC’s) responsibility to determine whether IR35 applies.
Changes to IR35 rules are proposed from April 2020 for medium and large businesses in the private sector which largely mirror those changes in the public sector in 2017. In general terms, under the proposed new regime, the onus would shift from the PSC to the end user client to make a status determination. Responsibility for accounting for tax and national insurance would be on the party who pays for the individual’s services, i.e. the client or end user.
Whilst there has been talk of reviewing the legislation, which may push back the implementation date, we would still advise employers to continue to prepare for 6 April 2020.
For more information on the IR35 reforms in the private and charity sectors see our Blogs here.
According to the Queen’s Speech there will be an Employment Bill later in the year, which is expected to include:
The Queen’s Speech also included references to a national disability strategy. We may see the introduction of a right to request workplace modifications for employees with a health condition that does not amount to a disability as part of this. Such a duty would have significant implications for how employers handle sick and absent employees.
If the EU Withdrawal Bill passes and the UK leaves the EU at the end of January, we will not see any Brexit-related employment related changes this year. During the transitional period that ends on 31 December 2020 the UK will continue to apply EU law and CJEU decisions will continue to be binding on UK Courts and Tribunals.
The Government carried out consultations in relation to sexual harassment in 2019 (see our updates here and here).
Although it is unclear whether this area is a current political priority, we could see legislation in relation to the use of confidentiality provisions when settling harassment or discrimination complaints and the re-introduction of protection against third party harassment, amongst other things.
Tags: Expected in 2020
Categories: Employment Law
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