UK employment law rarely stands still, and a number of legislative changes are expected in 2019. The hot topics of the last few years, such as Brexit, the gig economy and #metoo movement, are all expected to remain in the headlines, but here are some selected highlights to look out for in 2019:
Brexit
The main event for 2019 is, of course, the UK’s exit from the European Union (EU). At the time of writing, uncertainty remains over the nature of the withdrawal deal (if any) that will be agreed – and the UK’s employment law position post-Brexit may well be determined by that agreement.
Realistically, however the news unfolds as we reach the 29 March deadline, it is unlikely we will see immediate, substantial changes to employment law driven directly by Brexit. But employers will still have to continue to grapple with potential Brexit-related relocations, recruitment challenges, redundancies and restructuring.
Legislation linked to Brexit:
- British Bill of Rights: Consideration of the controversial British Bill of Rights was delayed until after the UK leaves the EU. This Bill of Rights, which formed part of the Conservative party manifesto, has been proposed to replace the Human Rights Act 1998. It has been strongly criticised by the House of Lords European Union Committee.
- Whistleblower protection: The European Commission has proposed a new directive to protect whistleblowers. But its impact on the UK will depend on Brexit withdrawal arrangements, although it is worth bearing in mind that most EU law will continue to apply during any transition period.
Payslips, tips and increases to statutory rates
From 6 April 2019, all workers (not just employees, as is currently the case) will have the right to receive itemised pay statements. In both cases, if an individual’s pay varies in line with the amount of time they have worked, the itemised pay statement must reflect how many hours they have worked in relation to their pay.
On 1 October 2018, the government announced plans to introduce legislation to prevent employers from keeping tips meant for workers. Although it has indicated the new legislation will be introduced at the earliest opportunity, it is unclear when it will be.
2019 will also bring the following increases in statutory rates:
- Pensions: From 6 April 2019, the minimum contributions into automatic enrolment workplace pension schemes will rise. The new minimum total contribution level will be 8% of qualifying earnings, with employers obliged to contribute at least 3% of this figure.
-
The National Living Wage: This is due to rise to £8.21 (US$10.46) per hour from 1 April 2019. All other hourly minimum wage brackets will increase in April too:
- 21-24 years: £7.70 (US$9.81);
- 18-20 years: £5.90 (US$7.51);
- Under 18: £4.20 (US$5.35);
- Apprentices: £3.70 (US$4.71).
- Statutory maternity, paternity, adoption and shared parental pay: Standard rates (subject to eligibility) will rise to £148.68 (US$189.37) per week. This change usually takes place on the first Sunday in April.
- Statutory sick pay: This is due to rise to £94.25 (US$120.05) per week, from 6 April 2019.
Mandatory reporting
Chief executive pay: Larger employers will be required to report the ratio between chief executive pay and average staff pay for accounting periods beginning on or after 1 January 2019. This means that the first reports will fall due in 2020, and so the underlying information is being created now.
Gender pay gap: Employers are approaching the second annual date for gender pay gap reporting, which applies to companies with 250 employees or more. Reports must be created within 12 months of the ‘snapshot date’, which is 5 April in the private and voluntary sectors and 31 March in the public sector. They have to be published on both the employer’s own, and the government’s, website.
This second annual gender pay gap report is significant as employers can expect them to be scrutinised for signs of improvement compared with last year.
Ethnicity pay gap: While no legislation exists here yet, a consultation on mandatory ethnicity pay gap reporting for employers is under way.
Sexual harassment and non-disclosure agreements
In 2018, the Women and Equalities Committee (WEC) launched an enquiry into the extent of sexual harassment in the workplace, how effective legal remedies were in encouraging victims to come forward, and the steps the government and employers could take to support victims. As a result of this probe, it recommended increasing regulation in the area, improving enforcement processes for employees, legislating on confidentiality and whistleblowing, and undertaking regular government data surveys.
The government’s response was published in December 2018. It includes the following measures:
- Asking the Equality and Human Rights Commission to develop a statutory code of practice on sexual harassment. The idea is that if employers observe this code, it will be easier for them to demonstrate they have taken reasonable steps to prevent the issue from taking place;
- Consultation on a mandatory duty to protect workers from sexual harassment and better regulation of non-disclosure agreements.
We can expect the use of non-disclosure agreements in relation to allegations of sexual harassment to be a hot topic for debate over the year ahead. In November 2018, the WEC launched an inquiry into the matter, looking in particular at whether the use of non-disclosure agreements should be banned or restricted in cases where discrimination or harassment is alleged, and what safeguards should be put in place to prevent their unethical use.
Beyond 2019
Good Work Plan
Looking beyond 2019, the government’s Good Work Plan includes legislation that is due to come into force in April 2020. Billed as “the biggest package of workplace reforms for over 20 years”, it aims to improve working conditions for atypical workers. The measures envisaged include:
- Prohibiting deductions from staff tips;
- Abolition of the Swedish Derogation, which excludes some agency workers from the right to the same pay as directly-hired comparators as well as an investigation into umbrella companies;
- A right for workers to request more stable contracts;
- State enforcement of holiday pay for vulnerable workers;
- Improved enforcement of unpaid employment tribunal awards;
- Clearer employment status tests.
Other consultations that started in 2018 are still ongoing, for example, those relating to:
- Mandatory ethnicity pay gap reporting;
- Employment status tests;
- National minimum wage, salaried hours work and salary sacrifice schemes.
Parental bereavement leave and pay
A new right to parental bereavement leave and pay is expected to come into effect in 2020. Draft regulations are expected soon and are expected to provide employed parents who have lost a child with two weeks’ leave and pay, to be taken within 56 weeks, as a single block or two separate weeks of leave.
Delayed consultations
It is striking how many employment law consultations have been introduced in recent years that now seem to have been parked with little reported progress, presumably due to the focus on Brexit. But they remain issues to look out for despite no implementation date being available.
An example here is grandparental leave: The government announced plans in 2016 to extend shared parental leave to grandparents and, at the same time, simplify the shared parental leave notification process and eligibility requirements. No further announcements have been made since and it is now unclear whether these plans will proceed.
Anne-Marie Balfour is a solicitor and legal director in the employment, pensions and immigration team at Charles Russell Speechlys LLP. She advises employers and senior executives on all aspects of employment law. Anne-Marie has particular expertise in employment law with an immigration angle and her articles are frequently published in the national and trade press.
OTHER STORIES THAT MAY INTEREST YOU
UK payments changes: Understanding new confirmation of payee rules
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UK agency worker regulations: Saying goodbye to the Swedish Derogation
UK employment law rarely stands still, and a number of legislative changes are expected in 2019. The hot topics of the last few years, such as Brexit, the gig economy and #metoo movement, are all expected to remain in the headlines, but here are some selected highlights to look out for in 2019:
Brexit
The main event for 2019 is, of course, the UK’s exit from the European Union (EU). At the time of writing, uncertainty remains over the nature of the withdrawal deal (if any) that will be agreed – and the UK’s employment law position post-Brexit may well be determined by that agreement.
Realistically, however the news unfolds as we reach the 29 March deadline, it is unlikely we will see immediate, substantial changes to employment law driven directly by Brexit. But employers will still have to continue to grapple with potential Brexit-related relocations, recruitment challenges, redundancies and restructuring.
Legislation linked to Brexit:
- British Bill of Rights: Consideration of the controversial British Bill of Rights was delayed until after the UK leaves the EU. This Bill of Rights, which formed part of the Conservative party manifesto, has been proposed to replace the Human Rights Act 1998. It has been strongly criticised by the House of Lords European Union Committee.
- Whistleblower protection: The European Commission has proposed a new directive to protect whistleblowers. But its impact on the UK will depend on Brexit withdrawal arrangements, although it is worth bearing in mind that most EU law will continue to apply during any transition period.
Payslips, tips and increases to statutory rates
From 6 April 2019, all workers (not just employees, as is currently the case) will have the right to receive itemised pay statements. In both cases, if an individual’s pay varies in line with the amount of time they have worked, the itemised pay statement must reflect how many hours they have worked in relation to their pay.
On 1 October 2018, the government announced plans to introduce legislation to prevent employers from keeping tips meant for workers. Although it has indicated the new legislation will be introduced at the earliest opportunity, it is unclear when it will be.
2019 will also bring the following increases in statutory rates:
- Pensions: From 6 April 2019, the minimum contributions into automatic enrolment workplace pension schemes will rise. The new minimum total contribution level will be 8% of qualifying earnings, with employers obliged to contribute at least 3% of this figure.
-
The National Living Wage: This is due to rise to £8.21 (US$10.46) per hour from 1 April 2019. All other hourly minimum wage brackets will increase in April too:
- 21-24 years: £7.70 (US$9.81);
- 18-20 years: £5.90 (US$7.51);
- Under 18: £4.20 (US$5.35);
- Apprentices: £3.70 (US$4.71).
- Statutory maternity, paternity, adoption and shared parental pay: Standard rates (subject to eligibility) will rise to £148.68 (US$189.37) per week. This change usually takes place on the first Sunday in April.
- Statutory sick pay: This is due to rise to £94.25 (US$120.05) per week, from 6 April 2019.
Mandatory reporting
Chief executive pay: Larger employers will be required to report the ratio between chief executive pay and average staff pay for accounting periods beginning on or after 1 January 2019. This means that the first reports will fall due in 2020, and so the underlying information is being created now.
Gender pay gap: Employers are approaching the second annual date for gender pay gap reporting, which applies to companies with 250 employees or more. Reports must be created within 12 months of the ‘snapshot date’, which is 5 April in the private and voluntary sectors and 31 March in the public sector. They have to be published on both the employer’s own, and the government’s, website.
This second annual gender pay gap report is significant as employers can expect them to be scrutinised for signs of improvement compared with last year.
Ethnicity pay gap: While no legislation exists here yet, a consultation on mandatory ethnicity pay gap reporting for employers is under way.
Sexual harassment and non-disclosure agreements
In 2018, the Women and Equalities Committee (WEC) launched an enquiry into the extent of sexual harassment in the workplace, how effective legal remedies were in encouraging victims to come forward, and the steps the government and employers could take to support victims. As a result of this probe, it recommended increasing regulation in the area, improving enforcement processes for employees, legislating on confidentiality and whistleblowing, and undertaking regular government data surveys.
The government’s response was published in December 2018. It includes the following measures:
- Asking the Equality and Human Rights Commission to develop a statutory code of practice on sexual harassment. The idea is that if employers observe this code, it will be easier for them to demonstrate they have taken reasonable steps to prevent the issue from taking place;
- Consultation on a mandatory duty to protect workers from sexual harassment and better regulation of non-disclosure agreements.
We can expect the use of non-disclosure agreements in relation to allegations of sexual harassment to be a hot topic for debate over the year ahead. In November 2018, the WEC launched an inquiry into the matter, looking in particular at whether the use of non-disclosure agreements should be banned or restricted in cases where discrimination or harassment is alleged, and what safeguards should be put in place to prevent their unethical use.
Beyond 2019
Good Work Plan
Looking beyond 2019, the government’s Good Work Plan includes legislation that is due to come into force in April 2020. Billed as “the biggest package of workplace reforms for over 20 years”, it aims to improve working conditions for atypical workers. The measures envisaged include:
- Prohibiting deductions from staff tips;
- Abolition of the Swedish Derogation, which excludes some agency workers from the right to the same pay as directly-hired comparators as well as an investigation into umbrella companies;
- A right for workers to request more stable contracts;
- State enforcement of holiday pay for vulnerable workers;
- Improved enforcement of unpaid employment tribunal awards;
- Clearer employment status tests.
Other consultations that started in 2018 are still ongoing, for example, those relating to:
- Mandatory ethnicity pay gap reporting;
- Employment status tests;
- National minimum wage, salaried hours work and salary sacrifice schemes.
Parental bereavement leave and pay
A new right to parental bereavement leave and pay is expected to come into effect in 2020. Draft regulations are expected soon and are expected to provide employed parents who have lost a child with two weeks’ leave and pay, to be taken within 56 weeks, as a single block or two separate weeks of leave.
Delayed consultations
It is striking how many employment law consultations have been introduced in recent years that now seem to have been parked with little reported progress, presumably due to the focus on Brexit. But they remain issues to look out for despite no implementation date being available.
An example here is grandparental leave: The government announced plans in 2016 to extend shared parental leave to grandparents and, at the same time, simplify the shared parental leave notification process and eligibility requirements. No further announcements have been made since and it is now unclear whether these plans will proceed.
Anne-Marie Balfour is a solicitor and legal director in the employment, pensions and immigration team at Charles Russell Speechlys LLP. She advises employers and senior executives on all aspects of employment law. Anne-Marie has particular expertise in employment law with an immigration angle and her articles are frequently published in the national and trade press.
OTHER STORIES THAT MAY INTEREST YOU
UK payments changes: Understanding new confirmation of payee rules
UK staff entitled to employment conditions statement after a month, rules tribunal
UK agency worker regulations: Saying goodbye to the Swedish Derogation
