Director Spratt Endicott Solicitors
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Employment law changes for 2020

The coming year will see a number of changes to employment law. Here’s what you need to know as an HR professional.

22nd Jan 2020
Director Spratt Endicott Solicitors
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Business woman and business man shaking hands with a contract
iStock/courtneyk

April 2020 is set to be a busy time, with multiple employment law changes coming into force that businesses need to be aware of. Some of the various changes are set out below.

As with any employment law matter, it’s best to start thinking about how these changes affect your business now and plan accordingly, rather than simply waiting for their introduction before looking to take the appropriate steps.

Written statement of key terms/employment particulars

All workers (including employees) starting work on or after 6 April 2020 will be entitled to a written statement of key terms on or before the date they start work. This was something that previously applied to employees only and had to be given no later than two months after the beginning of employment. Now though, it’s being broadened to encompass workers in general and must be provided on or before the day they start work.

Most key terms must be provided in a single document, but exceptions include pensions, collective agreements, any trading entitlement, and certain information about disciplinary and grievance procedures.

The written statement will also need to contain additional information, which includes the following:

  • Any probationary period.
  • 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.
  • Any paid leave to which the worker is entitled.
  • Details of all remuneration and benefits.
  • Any training entitlement provided by the employer, including whether any training is mandatory and/or must be paid for by the worker.

It’s good practice to update your written statements sooner to reflect the new changes so that you are ready and compliant when they come into force next year.

Key facts for agency workers

All employment businesses will be required to provide agency workers with a key information document containing prescribed information including:

  • The type of contract.
  • The minimum expected rate of pay.
  • How they will be paid and by whom (for example, an intermediary or umbrella company).
  • Any deductions or fees that will be taken.
  • Any non-monetary benefits to which they will be entitled.
  • Any entitlement to annual leave and payment in respect of such leave, and an illustrative example of what this might mean for take-home pay.

Holiday reference period

The holiday pay reference period for determining a week’s pay is changing from 12 weeks to 52 weeks. This will ensure that workers who do not have a regular working pattern throughout the year are not disadvantaged by having to take their holiday at a quiet time of the year when their weekly pay might be lower.

The 52-week reference period will apply to all calculations of statutory holiday pay under the Working Time Regulations 1998 in which the 12-week reference period would otherwise have been used (in other words, workers with no normal working hours, and workers with normal working hours whose pay varies with the amount of work done or the times or days on which it is done). Employers need to make sure they are calculating holiday pay in the correct way.

Information and consultation thresholds

The threshold required for a valid employee request to negotiate an agreement on informing and consulting its employees will be lowered from 10% to 2% of employees, subject to the existing minimum of 15 employees.

IR35 and off-payroll rules

Tax legislation IR35 will be extended to the private sector from April 2020. The responsibility for determining employment status for tax purposes will shift to the ‘employer’.

If the new rules apply to you as a business then you should make sure that you have an action plan in place to review your current arrangements with off payroll workers, your internal systems and policies.

National insurance contributions on termination payments

Class 1A employer national insurance contributions will be payable on termination payments over £30,000 – so employers do need to check that they are paying the correct amount of national insurance contributions on termination payments.

The Parental Bereavement (Leave and Pay) Act 2018

It is expected that all employed parents or carers will be entitled to a day-one right to two weeks leave if they lose a child under the age of 18 or suffer a still birth after 24 weeks of pregnancy.

If the employee has more than 26 weeks of continuous service, they’re entitled to the statutory rate for this two-week period – otherwise, the leave will be unpaid.

Next steps

An employment lawyer will be able to advise you on how the above will affect you and the steps that you need to take to ensure that these changes have the minimum disruption to your business.

If any of the above changes impact on your business then you should take steps to make sure that you will be ready for the changes. This will include updating any documentation including policies and procedures as appropriate.

A full list of employment law updates can be found at gov.uk/browse/employing-people

*Disclaimer: while everything has been done to ensure the accuracy of the contents of this article, it is a general guide only. It is not comprehensive and does not constitute legal advice. Specific legal advice should be sought in relation to the particular facts of a given situation.  

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