In recent weeks the Government has proposed a number of Brexit-related reforms to employment law, issued guidance on taking positive action in the workplace, and passed new legislation on tipping. The Home Office has also issued guidance on reporting remote or hybrid working by sponsored workers.
We’ve rounded up these important updates below, so you can stay up-to-date with your legal obligations.
1. Government ditches sunset date for repeal of all EU laws
The Government has backtracked on its intention to revoke all retained EU laws automatically at the end of 2023, due to the large volume of law identified and the potential for legal disputes and uncertainty. Instead, the Government has published a list of the retained EU laws it intends to revoke at the end of 2023, and has advised that it will continue to consult on, and assess, whether further reforms are suitable. At present, there is nothing on the list for revocation that will have a significant impact on our employment laws. That may change, however: see below for further guidance on their current consultation regarding employment laws.
2. Government consults on proposed reforms to EU employment rules
The Government has issued a policy paper advising of its intention to remove ‘unnecessary and burdensome’ EU regulations from UK law, in order to promote a more productive economy. Although the Government has ditched the proposed sunset date for repealing all EU laws (as set out above), they’ve specifically announced a consultation on various employment law reforms, including:
- removing requirements for working hour records to be kept for almost all members of the workforce;
- allowing businesses with fewer than 50 people and/or businesses undertaking transfers affecting less than 10 employees to consult directly with affected employees under a TUPE transfer, rather than being required to elect employee representatives; and
- changes to leave entitlements and holiday pay:
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- merging the current two separate leave entitlements (4 weeks under EU regulations and 1.6 weeks under UK domestic law) into one pot of statutory annual leave, which will remain at 5.6 weeks. No changes are anticipated to the rules around workers carrying over leave into the next year, but the Government is consulting on how to define the rate of holiday pay (eg whether this should include an allowance for regular bonuses, commissions or overtime, or simply be a basic rate of pay);
- clarifying how employers should calculate holiday entitlement for workers in their first year and allowing this to be calculated on the basis of pay periods, rather than monthly, if that is more appropriate;
- removing the ability for workers to roll over their leave due to the effects of COVID-19;
- introducing ‘rolled-up’ holiday pay, which increases workers’ pay each payslip to account for their holiday pay, rather than paying them while they are away on holiday. This may be particularly useful for gig workers or those with irregular hours, as employers can pay their holiday pay at a proposed rate of 12.07% on top of their usual pay. Rolled-up holiday pay was previously outlawed under EU regulations as it may discourage workers from taking holidays.
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If you’d like to take part in the consultation, you can submit your views here. The consultation will close on 7 July 2023.
The Government has also advised that, when parliamentary time allows, they’ll legislate to limit the length of non-compete clauses to 3 months, giving employees more flexibility to start up a rival business or join a competitor after they leave a position. The Government has advised that this change won’t affect employers’ abilities to use paid notice periods, gardening leave, non-solicitation clauses, or confidentiality clauses.
3. Government publishes guidance on how to take positive actions in the workplace under the Equality Act 2010
The Equality Act 2010 allows employers in some circumstances to treat certain groups with a protected characteristic more favourably than those without. This type of positive action is aimed at levelling the playing field for those who may otherwise be disadvantaged in the workplace. The Government has issued guidance on how to legally take positive action in the workplace, for example by:
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- ensuring you have appropriate evidence that the action is proportionate;
- determining how you will assess whether sufficient action has been taken and whether such actions remain necessary over time; and
- making sure you don’t unlawfully discriminate against those without the protected characteristic.
The Government emphasises that employers should seek legal advice before taking positive actions. You can access a lawyer in a few simple steps using our Ask a Lawyer service.
4. Home Office issues guidance on reporting hybrid or remote working patterns for sponsored workers
If you are a sponsor of workers or temporary workers, you must notify the Home Office of their normal work location. Given the changes in many workers’ patterns of work since the COVID-19 pandemic, the Home Office advised earlier this year that sponsors must report when:
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- the worker is or will be working remotely from home on a permanent or full-time basis (with little or no requirement to attend the workplace);
- the worker has a hybrid working pattern (eg they work part of the time at your workplace and part of the time at home or a co-working space); or
- the worker is working at a different site or branch than that previously notified to the Home Office.
You don’t need to report ad-hoc changes (such as the occasional day working from home or from another site), only changes to your workers’ regular working patterns.
You should review any work location details for workers that you sponsor and report any changes to the Home Office within 10 working days of the change. If you have missed this deadline you should report the change as soon as possible. You and/or your worker may wish to seek legal advice on what consequences could flow from the change in their work location (eg whether they in fact need to be based in the United Kingdom if they can work remotely). For access to a specialist lawyer in a few simple steps, you can use our Ask a Lawyer service.
5. Workers to take home tips as new law on tipping passes
Employers soon won’t be permitted to withhold tips and/or service charges from their staff, as the Employment (Allocation of Tips) Bill 2022-23 was passed into law on 2 May 2023. This bill is aimed at ensuring staff receive the tips, gratuities and service charges they have earned, along with allowing workers to view an employer’s tipping record, and it’s estimated that an extra £200 million a year will be received by staff. The reforms are expected to come into force in 2024, after a Code of Practice has been published and consulted on.
Don’t forget to check out our blogs from earlier this year for more employment law updates, including ACAS issuing guidelines on reasonable adjustments for mental health, April increases to statutory employment payments, and Government appoints first Menopause Employment Champion.
The content in this article is up to date at the date of publishing. The information provided is intended only for information purposes, and is not for the purpose of providing legal advice. Sparqa Legal’s Terms of Use apply.
Marion joined Sparqa Legal as a Senior Legal Editor in 2018. She previously worked as a corporate/commercial lawyer for five years at one of New Zealand’s leading law firms, Kensington Swan (now Dentons Kensington Swan), and as an in-house legal consultant for a UK tech company. Marion regularly writes for Sparqa’s blog, contributing across its commercial, IP and health and safety law content.