Mills & Reeve: HR Law Live

What has happened to the Employment Bill?

The Government has now offered an explanation for the absence of an Employment Bill in the 2021 Queen’s Speech. In a response to a letter from the Chairs of the Work and Pensions and BEIS Committees, the BEIS Secretary Kwasi Kwarteng has said that the Bill will be brought forward when the “time is right” and “not while the pandemic is ongoing and continuing to affect the economy and the labour market in some unpredictable ways”.

In the December 2019 Queen’s Speech, the Government announced that it would introduce a new Employment Bill. One of the Bill’s main purposes was to “build on existing employment law with measures that protect those in low-paid work and the gig economy”.  No such Bill was published in the 2019/2021 parliamentary session, though it was widely expected that it would be carried forward into the 2021/2022 session.

However, there was no mention of plans for an Employment Bill in the 2021 Queen’s Speech. It did however include some employment-related announcements, including a commitment to respond “in due course” to the report of the Commission for Racial and Ethnic Disparities, which was published on 31 March.

There are some other recent clues about the Government’s current plans for employment law reform.

Most recently, on 8 June, the Government launched its response to the 2019 consultation on the establishment of a new single body to enforce core employment rights. This will require primary legislation, which will be brought forward “when parliamentary time allows".

A few weeks earlier, on 14 May, the Government published its response to the Women and Equalities Committee report on the gendered impact of Covid. This response confirms that the Government is committed to consulting on how to make “flexible working the default unless employers have good reasons not to”. It also reiterates its previous promise to extend the redundancy protection afforded to mothers. Measures will be brought forward “as soon as parliamentary time allows” to extend exiting protection (which runs during maternity leave) to pregnant women and for six months after a mother has returned to work. This will also apply to those taking adoption leave and shared parental leave.

Hatti Briggs, Trainee Solicitor

Body of employment-related Covid-19 legislation continues to grow

Over the past few weeks, we have seen more adjustments to eligibility for statutory sick pay to address the pandemic, as well as amendments to the way pay during statutory leave is calculated for furloughed staff.

Shielded employees and SSP

On 16 April, eligibility for Statutory Sick Pay was extended by new regulations. They amend the SSP regime so that, with effect from that date, people who are “defined in public health guidance as extremely vulnerable and at very high risk of severe illness from coronavirus because of an underlying health condition” can claim SSP for the period during which they are shielding in line with that advice.

Like the March SSP amendments (which extended eligibility to those who are self-isolating because they or someone in their household has coronavirus symptoms) this is done by deeming such people “incapable” of work for the purposes of the SSP regime.

The deemed incapacity route means that a shielding employee in receipt of SSP will not necessarily be regarded as incapable of work for the purposes of any contractual sick pay or as on sick leave for the purposes of the Working Time Directive. The correct approach in relation to pay and holiday entitlement for shielding employees will therefore depend on the interaction between relevant contractual terms and the employer’s obligations under health and safety legislation, as well as current public health guidance.

Statutory leave and the CJRS

It has not always been clear how furloughing staff under the Coronavirus Job Retention Scheme will impact on existing employment rights, since the Scheme has been implemented without any changes being made to the UK’s basic employment framework. However, a month into the Scheme we now have some regulations which address the entitlement of furloughed staff to earnings-related statutory maternity pay and similar statutory benefits, including maternity allowance and statutory adoption pay.

The aim of the new legislation is to protect the entitlement of furloughed staff to earnings-related benefits during periods of statutory leave, so they are based on their pre-furlough salary. This will protect staff whose employers do not top up the grant under the Scheme, calculated at 80% of normal pay, where the reference period for calculating their statutory pay falls during a period of furlough.The regulations came into force on 25 April.

Other changes in the pipeline

The Coronavirus Act 2020 introduced some significant employment-related measures, but not all of them came into force immediately. The Government has now published a quick reference guide, so that you can see at a glance what provisions are in force. Those on emergency volunteering leave are among a number of measures that have not yet been brought into effect.

 

Government consultations on support for families and time off – where are we now?

The Taylor Review and Good Work Plan have led to a large number of proposals and consultations over the last few years. A number of these consultations have focused on proposals to better support working families.  Recent developments in this area are as follows:

Neonatal leave and pay

In March 2020 the government published its response to last year’s consultation.

It confirms that there will be a new right to paid time off work for parents of babies who have spent at least a week in neonatal care, because they were born prematurely or sick. Parents will be entitled to one week of Neonatal Leave and Pay (at the usual statutory rate) for every week that their baby is in neonatal care, up to a maximum of 12 weeks.

Parents will be able to take this new type of leave, on top of their maternity or paternity leave, to allow them to be with their sick baby in hospital. 

The new entitlement will be set out in the Employment Bill, which is yet to be published. It appears from costings in the Spring 2020 Budget that the new right will not come in to force until sometime in 2023. So employers do not need to start planning for this just yet.

Carer’s leave

On 16 March 2020 a consultation opened into the government’s proposal that employees with (unpaid) caring responsibilities, for example for a family member or dependent, should be given one week’s additional unpaid leave a year to provide care.

The consultation closes on 3 August 2020. After that, more information should be available for employers on how carer’s leave will work in practice, including how much notice an employee will need to give and what evidence employers should ask for.

No time-frame has been given for when the new right will be brought in, so again, this is just something for employers to keep an eye on in the longer term.

Other consultations the government will be responding to

Consultations on the transparency of flexible working and parental leave/pay policies and the wider reform of family-related leave and pay closed in October and November 2019. We are waiting for the government to respond to both of these.

On a more general note, the government will also be responding to its consultation on employment status and the more wide-reaching recommendations of the Taylor review, when time allows.  In the meantime, Principal Associate Siân Jackson explains what employers can do to prepare in this article.

Amy O'Brien, Professional Support Lawyer

Are you prepared for the changes to employment law on 6 April 2020?

A number of changes are coming in on 6 April 2020, which have been in the pipeline for some time. 

Good work plan

The first set of changes implement parts of the Government’s Good Work Plan of 2018, which came out of the Taylor Review. In summary:

• Extended right to a written statement: Workers – not just employees – will be entitled to a written statement explaining certain terms of their employment and other information. It must be provided on or before the date on which they start. There is a list of new information you must set out (for both workers and employees), which includes things like how a worker’s hours or days of work might vary and how any probationary period works.
• Change to reference period for statutory holiday pay: You will need to calculate statutory holiday pay for workers without regular working hours based on the average weekly pay received in the 52 weeks before their holiday (rather than 12).
• Change to trigger for statutory information and consultation agreement: The threshold required for a request to set up an agreement to consult on employment-related matters will be reduced from 10% to 2% of the workforce (subject to a minimum of 15 people).
• If you use agency workers: They will be entitled to be paid the same as comparable direct recruits after 12 weeks (and to be informed the previous provisions no longer apply by 30 April).  Employment agencies must also provide them with a “fact sheet” with certain information about their work arrangements.

We anticipate that a number of other measures coming out of the Good Work Plan will be covered by a new Employment Bill, expected later this year.

Other changes

Five other 6 April changes to note are:

• Employment tribunal limits: The limit on a week's pay will rise to £538 and the cap on the compensatory award will increase to £88,519.  See here for full details of all the increases.
• Tax treatment of termination payments: All termination payments above £30,000 will be subject to employer NICs.
• IR35: The off-payroll working rules will be extended to all medium and large businesses. Those businesses will now need to decide whether contractors are required to pay income tax and NICs and, if they do, to pay HMRC. There will also be changes to the off-payroll working rules for public bodies. We explain more about the changes, in particular the new requirements of a “status determination statement” for public bodies, in this article.
• The NMW rules: Various changes are being made for salaried hours workers, who can now be paid in additional equal instalments. Employers can choose a calculation year and make premium payments for basic hours. The NMW naming scheme will also start again.
• Parental bereavement leave and pay: Working parents will have a statutory right to take leave following the devastating loss of a child, so they can grieve away from the workplace. We explain everything you need to know, including the steps you should take to prepare, in this article.

Amy O'Brien, Professional Support Lawyer

 

[Edited on 4 March to include details of new employment tribunal limits.]

Two key policy objectives drive July’s rush of consultations

Five new employment law consultations were published in July, as well as two responses to consultation.  They can all be linked two overlapping themes which were priorities during Theresa May’s tenure at number 10: promoting “good work” and tackling gender inequality in the workplace.

Good Work

Three of the consultations are directly connected with the Government’s Good Work Plan, itself a response to the wide-ranging Taylor Review which Theresa May commissioned soon after she became Prime Minister and which reported in 2017.

Consultations earlier this month on workplace health and enforcement of employment law rights (brief details here) have been followed by a further consultation on “one-sided flexibility” which closes on 11 October. This explores how best to introduce new rules which would oblige employers to give minimum notice of work schedules, and to provide compensation if they are cancelled at short notice. The consultation does not address a proposed new right for workers on irregular hours to request a “more predictable and stable contract”, but the Government says remains committed to bringing forward new legislation to introduce this right, which is likely to be modelled on the right to request flexible working.

Gender equality

Gender equality could be considered as part and parcel of good work, but it is a wide topic in its own right.  At its broadest it extends from eliminating gender-based harassment and discrimination in the workplace to tackling the root causes of the gender pay gap.

Earlier this month the Government set out its plans to tackle sexual harassment in the workplace (see our earlier blog here for more details). This has been followed by a wide ranging consultation on reforming family-friendly leave:

• The first part of the consultation (which runs until 29 November) considers the “benefits, costs and trade-offs” of the four main types of statutory leave: maternity leave, paternity leave, shared parental leave and parental leave.
• The second part of the consultation explores proposals for giving an additional period of leave to the main carer of babies who require neo-natal care (closing date 11 October).
• The third and final part (also closing on 11 October) looks at measures to increase the transparency of what employers offer by way of flexible working and family-related leave and pay.

There are two other groups of proposals where consultation was completed earlier this year, and the Government has recently published its response:

• Pregnancy discrimination: the Government is proposing that special redundancy protection for new mothers should be extended for six months after they return to work. Those returning from adoption leave will be given the same protection.
• Non-disclosure agreements: legislation will be passed “as soon as Parliamentary time allows” which will provide that a confidentiality clause cannot prevent an individual from disclosing information to the police, regulated health and care professionals or legal professionals. Such clauses will need to “clearly set out” these and other limitations to their scope (for example in relation to the rights of whistleblowers).

Next steps

No implementation timetable has been published for any of these proposals. That is understandable in the light of the current political uncertainties. 

Court of Appeal takes new look at Equality Act exceptions for pregnancy and childbirth

Last month’s decision from the Court of Appeal should dispel any remaining doubts about whether employers are legally required to pay fathers taking shared parental leave as generously as mothers on maternity leave. In two related appeals from last year’s decisions in the Employment Appeal Tribunal, the Court of Appeal has said that no breach of the Equality Act is involved in giving birth mothers enhanced pay while they are on maternity leave, but only paying statutory shared parental pay to fathers taking shared parental leave.

The first of these cases (Ali v Capita Customer Management) was a claim for direct sex discrimination. In the second (Hextall v Leicestershire Police) there was an issue as to whether the proceedings should have been framed as an indirect discrimination or equal pay claim. In both cases the Court of Appeal ruled that the employers could rely on the Equality Act exception which states that where the claimant is a man “no account is to be taken of special treatment afforded to a women in connection with pregnancy or childbirth”.

The Court of Appeal was not impressed with arguments that periods of statutory maternity leave with enhanced pay in excess of the compulsory two week period should not be regarded as connected with pregnancy and childbirth. It is possible, however, that it might have been more open to such arguments if the period of enhanced statutory pay had been significantly in excess of the 14 week protected period guaranteed by the Pregnant Workers’ Directive (the period of full pay was 14 weeks in Ali and 18 weeks in Hextall).

It also rejected arguments that it was significant that the childbirth and pregnancy exception does not appear in the definition of indirect discrimination in the Equality Act. As well as more technical observations about the selection of the pool for comparison purposes, it said that it would be “very odd” if arrangements which fell within the exception in relation to direct discrimination and equal pay would still need to be scrutinised under the Act’s provisions on indirect discrimination.

Subject to any final appeal to the Supreme Court, it does now seem that the arguments about the lawfulness of enhancing statutory maternity pay (certainly for the first 14 weeks of leave) while failing to enhance statutory shared parental pay have been settled. However, that doesn’t mean that all arrangements with regard to shared parental leave will necessarily be given a clean bill of health, or that the pressure to give fathers caring for new-born children better rights will diminish.

Special redundancy protection to be extended to pregnant women and maternity leave returners

The Government is consulting on plans to extend the redundancy rights currently enjoyed by women on maternity leave to pregnant women and women returning to work after maternity leave. There is also a possibility of giving similar rights to parents returning to work from adoption or parental leave.

The fact that women on maternity leave are better protected against being made redundant than pregnant women or new mothers who have recently returned to work is an unexplained anomaly in UK employment law. As well as the broad protection against sex and pregnancy related discrimination which all women enjoy, mothers on maternity leave have an additional right to be considered for suitable alternative vacancies in a redundancy situation, in preference to anyone else under threat of redundancy.

The Government is now planning to create a consistent regime to protect pregnant women and new mothers by extending these special redundancy rights. The proposal is that these additional rights would apply to all mothers from the point they tell their employer they are pregnant to the end of a defined period after they return to work from maternity leave. That is likely to be six months, though the Government is consulting about the exact period.

The Government is also consider according similar rights to parents returning from other types of leave including adoption leave, parental leave and shared parental leave. Some of the issues around timing and eligibility are quite complicated for these additional types of leave. As well as seeking views through the consultation process, the Government plans to refine its thinking by using a specialist task force.

The consultation closes on 5 April 2019, but no implementation timetable has yet been published.

Top ten employment law topics for 2019

To mark the start of 2019, we have put together our review of the past year. We have selected the topics that we think have most engaged employment lawyers and human resources practitioners over the past 12 months and will continue to be significant in the year ahead.

The review starts with an explanation of the new immigration arrangements that are likely to apply post-Brexit, though many details are still unclear. Other topics covered include #MeToo, the gig economy and the implications of the latest case law on the interpretation of employment contracts.

Conference season provides impetus for new employment policy

A number of new employment policy initiatives have been launched by the Government to coincide with the Conservative Party conference last week. These include:

• Tipping: new legislation will be introduced to ensure that all tips left for workers will go to them in full. At the moment this depends on how the tip is paid and on the precise agreement reached between staff and restaurant owner.
• Parental pay transparency: the Government will be consulting on new legislation which would require employers with more than 250 staff to publish their parental leave and pay policies. Currently this is voluntary, and many employers (in both public and private sectors) do not make this information publicly available.
• Flexible working: the Government will consider creating a duty for employers to consider whether a job can be done flexibly, and make that clear when advertising.  These plans appear to extend to all employers, not just the larger ones.
• Apprenticeships: an extra £90 million of funding has been announced to enable employers to invest 25% of their apprenticeship levy in creating apprenticeships for people working in their supply chains. Under the funding rules as presently drafted, they are only allowed to spend these funds on training their own employees, or those of an associated company.

At last month's Labour Party conference it was the Shadow Chancellor’s employee share ownership proposals which caught the headlines. Although short of detail at the moment, the outline of the plan is as follows:

• Companies with over 250 staff would have to place 1% of their shares each year (up to a maximum of 10%) into an “inclusive share ownership fund”.
• The dividend income going to each worker would be capped at £500, with the rest going into a fund to pay for public services and welfare.
• The funds would be held and managed collectively, with a bar on selling or trading.

These share ownership plans have already attracted a great deal of comment, much of it unfavourable. However, even if there is a change of government, there is still a fair way to go before they can be translated into employment policy.

Paid bereavement leave for parents to be implemented in 2020

The Act laying down the framework for two weeks’ statutory leave for bereaved parents received Royal Assent last month.  It is due to come into effect at some point in 2020, since the Government wishes to give employers and payroll providers at least 18 months to prepare.

The full details of the new right will be set out in regulations which have not yet been made.  However, the Act lays down this broad framework:

• Bereaved parents of a child under 18 will have a “day 1” right to take up to two weeks’ leave from their employment in the 56 days after the child’s death.
• In addition, employees who have completed at least 26 weeks’ continuous service will be entitled to parental bereavement pay at the statutory flat rate (currently £145.18 a week) or 90% of their average weekly earnings (whichever is lower).
• The right will extend to parents of stillborn children if the stillbirth occurs after 24 weeks of pregnancy.  The Government has said that existing maternity and paternity rights in relation to children who die while parents are already accessing these rights will remain.
• If more than one of their children dies before the age of 18, a bereaved parent will be entitled to leave in respect of each child.
• There will be similar provisions to those applying to other types of statutory leave when it comes to overlapping contractual rights, continuation of employment, protection from detriment and the like.

These proposals started off as a private member’s Bill. Although they have now been adopted as Government policy, their relatively tentative start may reflect differing views about whether a new type of statutory leave was necessarily the best approach.

Clearly it is not possible to have a different type of statutory leave to match each type of circumstance in which an employee may legitimately need time off work for family reasons. What this new right does is to supplement the existing right to reasonable unpaid time off “in consequence of the death of a dependant” to provide an enhanced entitlement where that dependant is a child.

Many employers are already considerably more generous and flexible in terms of paid compassionate leave than this new statutory scheme. Equally, the introduction of this scheme will not preclude the need for HR departments to engage with requests for leave in a variety of personal circumstances, including other types of bereavement which may have an equally traumatic effect on an employee as the loss of a child.