News and insights from our Employment Law team
'Good Work Plan' update - 7 February 2020
- AuthorDesley Sherwin
With less than two months to go before the main provisions of the Good Work Plan come into effect, it’s time make sure you have everything ready.
Firstly, a reminder of what has already been implemented:
Two changes took effect on 6 April 2019:
- All employees and workers are now entitled to an itemised payslip setting out gross salary, deductions, net pay.1 Where variable hours are worked, the employer also has to include the total number of paid hours worked.
- The maximum penalty for aggravated breach has quadrupled from £5,000 to £20,000; 3
With effect from 6 April 2020, the main changes are:
- All new employees and workers will have a “day-one” right to a new-type Section 1 statement of written particulars from their very first day of employment (compared with the situation currently, where you have a two-month grace period to provide this, and to employees only). Lots of additional information will have to be included in the statement, including terms relating to normal hours of work (what days, whether fixed or varied start and finish times), duration and conditions of probation, eligibility for sick leave/pay, details of non-pay benefits, etc. 2
Existing employees whose employment started between 30 November 1993 and 6 April 2020 will have the right to request a new-type Section 1 statement. If they do, a compliant statement must be provided within one month.
- Currently, the holiday pay reference period is 12 weeks. This will increase from 12 weeks to 52 weeks 4, which means that employers will have to look back at the previous 52 weeks where a worker has worked and received pay (ignoring any weeks where no pay was received) to calculate the average weekly pay on which holiday pay will be based. It is hoped that this change will help to even out the variation in pay for workers, particularly those in seasonal or atypical roles.
- All agency workers will be entitled to a key facts statement 5 showing how much they can expect to be paid gross, what deductions will be made, and how much they are likely to receive net. The idea is that there will be no surprises when they get their pay packet. Additionally, they have to be informed of any monetary benefit and annual leave entitlements.
- The ‘Swedish Derogation’ (aka Pay Between Assignment contracts, where agency workers accept a lower rate of pay but continue to be paid between assignments) will be abolished. Once agency workers have satisfied a 12-week qualifying period, they will be entitled to equal pay with non-agency workers (i.e. those engaged directly by the employer). Any agency workers who immediately qualify must be given a statement by 30 April 2020.
- IR35 rules will change. These apply when a worker performs services for a client through an intermediary (personal service company). For medium and large private-sector businesses, the decision as to tax status (employed or self-employed) will shift from the personal service company to the end user, the ‘fee-payer’ (i.e. the entity who pays for the individual’s services). Contracts and pay arrangements should be under review in anticipation.
- The (surprisingly complicated) Parental Bereavement Leave Regulations 6 come into effect. Bereaved parents and primary carers will have the right to two weeks’ leave following the death of a minor child, or a stillbirth after 24 weeks’ pregnancy (on or after 6 April 2020). Bereaved parents will be entitled to take their leave in one two-week block, or in two separate blocks of one week. The leave must be taken before the end of a period of at least 56 days beginning with the date of the child’s death. There are additional provisions for intended and adoptive parents, foster parents, guardians and their partners, and even some close relatives and family friends.
Bereaved parents with a minimum of 26 weeks’ continuous service will also be entitled to statutory parental bereavement pay. Those with less than 26 weeks’ continuous service will be entitled to two weeks’ unpaid leave.
Of course, this is necessarily just a brief overview. For more details or if you wish to instruct us to review your employment contracts and policies, please contact the Roythornes Employment law team.
1 See the Employment Rights Act 1996 (Itemised Pay Statement) (Amendment) Order 2018
2 For the full provisions, see the Employment Rights (Miscellaneous Amendments) Regulations 2019 and The Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018
3 See the Employment Rights (Miscellaneous Amendments) Regulations 2019
4 See the Employment Rights (Employment Particulars and Paid Annual Leave)(Amendment) Regulations 2018
5 See Regulation 13A Conduct of Employment Agencies and Employment Businesses Regulations 2003 (as amended)
6 The Parental Bereavement Leave Regulations 2020.