Changes in Employment Law You Should Expect in 2020
6th April 2020 is set to be a big day! In the UK, we’re expected to see five changes to employment law coming into effect on this date. But what are they, and how might they affect things at your business?
New right to a written statement of terms
As the law currently stands, employees who have been continuously employed for more than one month must be provided with a written statement of terms within two months of their start-date.
The new law set to be brought about on 6th April will see all new employees and workers be given a right to a statement of written particulars from their very first day of employment.
Be prepared: begin preparation of the revised statement of particulars at the recruitment stage so that you can ensure it’s ready to be handed to the employee on their first day of work.
Changes to rules for agency workers
Currently, the Agency Worker Regulations 2010 outline that an agency worker is entitled to the same pay and basic working conditions as a direct recruit after they have completed 12 weeks of continuous service in the same role. The exemption to this comes with what is known as the ‘Swedish derogation’ which is currently in effect, allowing an exemption to the right of equal pay if an agency worker is employed under a permanent contract with the temporary agency, which in turn continues to make payments in the periods between assignments.
On 6th April, the ‘Swedish derogation’ will be removed, allowing agency workers the entitlement of the same rate of pay as that of a direct recruit after they have completed the 12-week qualifying period.
Be prepared: a written notification of the change must be provided by agencies with workers whose existing contracts contain a ‘Swedish derogation’. From 6th April, those seeking work through an agency must also be provided with a statement which sets out the terms under which they will undertake any work.
IR35 rule changes for the private sector
Presently, the IR35 rules apply where an individual worker personally provides a service to a client through an intermediary (such as a personal service company). If the services are provided under a direct contract, that worker is then considered to be employed by the client and therefore taxed accordingly. It is currently the intermediary’s decision as to whether IR35 applies.
The new law will see changes made to the IR35 rules for medium and large businesses in the private sector, mirroring the changes made to the public sector in 2017. With these new rules in place, it will now be the responsibility of the client, not the public service company, to determine whether or not IR35 applies. The party who pays for the services (the fee-payer) will therefore be responsible for accounting for tax and national insurance.
Be prepared: small businesses will not be affected by the changes, but medium and large businesses will be. For these businesses, it’s essential that assessments be carried out to determine whether or not the new IR35 rules apply to any independent contractors they work with. If so, their contracts must be reviewed, and their pay arrangements adjusted accordingly.
New parental bereavement law introduced
There is currently no law in place which entitles parents to bereavement leave and pay following the death of their child, but we can expect a new law to come into effect in April this year.
If passed successfully, the law should allow parents the right to two weeks of leave (taken in one block of two weeks or split into two separate one-week periods) following the loss of a child under the age of 18, or a stillbirth after 24 weeks of pregnancy.
Statutory parental bereavement pay will be a right for those who have been employed for a minimum of 26 weeks with continuous service, and those with less than 26 weeks of continuous service will be entitled to the same duration of leave without pay.
Adjustments to the reference period for holiday pay
Calculating holiday pay can be complicated, particularly for those who work irregular hours each week. Currently, the reference period for calculating holiday pay is set at 12 weeks.
The new law will extend the period from 12 weeks to 52, meaning that employers will be required to refer to the hours an employee has worked and received pay over the previous 52 weeks in order to calculate the average weekly pay entitled.
Have a question for one of the solicitors in our Employment department? DRN provide services for both employees and employers. Whether you’re a business owner facing a potentially damaging legal claim, or you’re not receiving your basic rights as an employee, the solicitors at DRN are highly experienced and here to help. Contact us today for more information.