Employment Law Updates 2023-24

The Employment Rights Bill
It is important to remember that the Bill will not become law under the current timetable until Autumn 2025. The Bill is currently going through the Committee stage. There are likely to be significant changes to the Bill before it actually becomes law.

Many HR firms and advisors give the impression that they know the final outcome of the various stages and consultation process and that the Bill will become law soon. This is simply a marketing exercise on their part.

The Employment Rights Bill is the new Labour government's flagship employment legislation. It is intended to give employees greater rights from the first day of their employment and to promote greater flexibility in the workplace and workforce. The aim is to increase productivity and the number of people at work. With almost one million people of working age not working, encouraging them to get jobs could be a major boost to the economy. Key parts of the Bill include "day-1" employment rights relating to unfair dismissal, paternity leave, unpaid parental leave and making flexible working the norm.

 

Worker Protection (Amendment of Equality Act 2010) Act 2023
This amendment to the Equality Act 2010 will come into force in October 2024. The amendment will place a duty on employers to take "reasonable steps" to prevent sexual harassment. This will mean that employers will need to be proactive in the steps they take. So, taking reasonable steps to avoid sexual harassment, rather than merely reacting and investigating it when it occurs. An up-to-date policy will be essential for employers - and making it known and enforced in the workplace. This new positive duty relates to sexual harassment, not to other forms of harassment or discrimination.

Where an employee brings and wins a claim for sexual harassment at an Employment Tribunal, the tribunal can enforce an "uplift" of up to 25% extra on any damages awarded if the employer fails to show they proactively took reasonable steps.

Also, the Equality and Human Rights Commission (EHRC) will have powers to enforce the new duty and take action against employers who do not follow the new duty.

Employers should have a clear policy in place and should also foster a positive and safe working environment to avoid possible claims.

 

The Employment Relations (Flexible Working) Act 2023
Under the Employment Relations (Flexible Working) Act 2023, employees have a day-one right to request flexible working. An employer has a statutory duty to consider any such request seriously. For this reason, it is important to have a clear, Flexible Working Policy in place. There are several reasons for the extension of flexible working rights. Firstly, it will be popular with the electorate. The second reason is that the UK economy has lost 500,000 workers since the pandemic. Enhancing flexible working rights will hopefully encourage more people to rejoin the workforce, or increase their current working hours.

Please see the following relevant policy and packs:

• Flexible Working Policy
• Workplace Pack
• Employers Pack

 

The Protection from Redundancy (Pregnancy and Family Leave) Act 2023
The current law provides additional protection from redundancy for employees on maternity, shared parental, or adoption leave. Where there is a redundancy situation, these employees are given priority access to alternative posts, if available – this priority is over other employees, so giving these protected employees first refusal on alternative roles. Where an employer fails to make this offer, protected employees have a right to bring a claim for unfair dismissal. The new Act offers additional protections.

Please see the following relevant policy and packs:

• Redundancy Policy
• Workplace Pack
• Employers Pack

 

The Neonatal Care (Leave and Pay) Act 2023
This Act will provide up to 12 weeks of paid neonatal care leave for parents with children in neonatal care. The Act became law on 24 May 2023, but it requires further regulations setting out how the entitlement will work. The regulations are expected to come into force no earlier than April 2025.

 

The Carer’s Leave Act 2023
The Act will give one week of unpaid leave per year for employees caring for a dependant with a long-term care need. The Act became law on 24 May 2023; but was not implemented until 6th April 2024.

Please see the following relevant policy and packs:

• Sickness and Absence Policy
• Workplace Pack
• Employers Pack

 

Non-Compete Clauses Reform
It is common practice for employment contracts relating to managers, senior employees, and directors to include various restrictive covenants. One of these is a restriction on competing against the former employer. Non-compete clauses prevent a former employee from working for a rival firm or setting up on their own for a period of time. The current law states that the time that can be enforced must be reasonable. Many current employment contracts specify 12 months. The government proposal is to limit this to a maximum of 3 months only. The thinking behind this is to ensure greater competition in the marketplace and to avoid employees staying with an employer because they cannot afford to spend 12 months out of work or not working in their field. It is important to note that it does not prevent employers from using other methods to reduce commercial risks to their business, such as paid notice periods and gardening leave. Also, the reforms will not impact non-solicitation and non-dealing covenants.

 

Holiday Entitlement
Under current UK law, employees are entitled to 28 days paid annual holiday; this is the statutory minimum. The days within this period fall under EU law and UK law. Twenty days under EU law and eight days under UK law. The government is proposing to bring all of these days under UK law.

The issue is that under EU law, normal remuneration includes elements such as overtime, bonuses, and commission within the calculation of holiday pay. Whereas UK holiday pay is paid at a basic rate excluding these additional elements. In certain jobs, this could significantly affect the amount of holiday pay.

 

Rolled-Up Holiday Pay
Rolled-up holiday pay is the practice of including a worker’s holiday pay entitlement within their basic pay, as it makes it easier to calculate and administer. However, as the worker is not paid separate holiday pay, evidence suggests they are less likely to take their full holiday entitlement. Rolled-Up holiday pay is not currently legal in the UK; however, the government is reviewing this.

 

Working Time records
The UK government is proposing to remove the requirement for organisations to keep employee records relating to working time.