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Employment Law Update – What does the future hold?


It’s the start of December, the advent calendars are out, and the festivities are commencing!

As 2020 is quickly approaching, it’s key for all businesses to stay up to date with the most recent developments in Employment Law and the changes that are set to be implemented next year.

We recently hosted our annual Employment Law Update for HR professionals, where we looked at what’s on the horizon in an unsettled economic and political climate.

In this blog, we’ll be looking at the everchanging legal landscape and touching on some of the more common questions and popular topics, as the year draws to a close.

How will Brexit affect Employment Law?

With the uncertainty surrounding Brexit, this is often at the forefront of people’s minds. The changes that could be implemented as a result of leaving the EU are entirely dependent on the type of government that is in power.

Due to their policies and views, a Conservative Government could introduce a cap on the amount of compensation that can be claimed for discrimination cases. As EU law currently prevents this, the government will have more flexibility following Brexit.

A Conservative Government could also reverse the holiday pay position to how it was before the European Court of Justice changed the landscape, for example: by not including commission in the calculation of holiday pay or by not allowing the carry-over of accrued but unused holiday entitlement when prevented from taking it due to sick leave.

Alternatively, the Labour Party have announced their intention to introduce a 4-day working week. Whilst logistically this could prove difficult for some businesses and industries, the proposal has received mixed responses.

It must be emphasised that these are predictions only, based on policies outlined in each party’s manifesto.

What is the Real Living Wage?

Living Wage Week’ from 11-17 November 2019 raised awareness across the UK of both the societal and business benefits of becoming an accredited employer.

There is no legal obligation for an employer to pay more than the National Living Wage, but nearly 6,000 UK businesses voluntarily pay the Real Living Wage, as they believe their staff deserve a fair day's pay for a hard day's work.

The Real Living Wage is calculated to take into consideration the cost of goods and services and even factors in the cost of birthday presents and Christmas. It is designed to be a more realistic reflection of the average individual’s outgoings.

Unlike the National Living Wage, the Living Wage Foundation says that the Real Living Wage should be paid to anyone over the age of 18 "in recognition that young people face the same living costs as everyone else".

Employers might think, what’s in it for me? Accredited companies have seen a significant improvement in employee engagement and a reduction in absenteeism, with 86% of businesses saying it has improved their reputation and 75% of businesses stating that it has increased motivation and retention rates. 

Ethnicity pay gap reporting

PwC have voluntarily published their ethnicity pay gap data since 2016, as they believe it is an important step towards ensuring the workforce is diverse and inclusive.

In March 2019, PwC published ‘Taking the right approach to ethnicity pay gap reporting’, as useful guidance for organisations who wish to implement it. They also outlined survey findings that 95% of companies surveyed have never analysed their ethnicity pay gap and 75% of companies surveyed do not have sufficient data to allow themselves to do so.

Employers must be aware that ethnicity pay gap reporting is different to - and more complex than - gender pay gap reporting. This is due to potential legal and GDPR implications, so specialist advice should be sought. 

It is worth noting that failure to address the need for workplace equality could lead to significant scrutiny and reputational damage. With this in mind, it is likely that ethnicity pay gap reporting will become mandatory in the future. 

The Good Work Plan

The Good Work Plan has been on the horizon for some time, and following various consultations, several changes are to be implemented on 6 April 2020.

Organisations should ensure that their documentation, processes and procedures are compliant with these changes and seek legal advice when uncertain.

Some examples of key changes include:

Changes to off-payroll working for clients

The off-payroll working rules (IR35) can apply to clients receiving services from workers through their intermediary.

The rules currently apply to all public sector clients but from 6 April 2020, the rules will also apply to medium and large-sized private sector clients, who will be responsible for deciding the employment status of workers. It is important to note that public sector clients will have additional responsibilities from 6 April 2020 that they must be familiar with.

The rules are aimed at reducing tax avoidance for off-payroll contractors working through personal service companies.

A failure to take reasonable care when determining the employment status of a worker could have costly consequences, as the worker’s tax and National Insurance contributions could become the client’s responsibility.

Parental bereavement leave

A new workplace right to paid leave for bereaved parents was officially enshrined in law on 13 September 2019 and is expected to come into force in April 2020.

This will entitle all employed parents to two weeks’ leave if they lose a child under the age of 18 or suffer a stillbirth from the 24th week of pregnancy. Subject to meeting eligibility criteria, pay can be claimed for this period of leave and there is no minimum service requirement.

When introduced, employers should inform employees of this new right and consider implementing a written and comprehensive bereavement policy, incorporating this change.

Sexual harassment

Following the highly publicised #MeToo movement, there has been a conscious effort to prevent sexual harassment in the workplace. There also tends to be more focus on this topic at this time of year, with the inevitable office Christmas parties on the horizon.

In July 2019, the Government launched a consultation which aimed to gather evidence about whether the current laws on protecting people from sexual harassment in the workplace are effective.

The Government had a particular interest in speaking with victims and examining the following:

As the consultation only recently closed on 2 October 2019, we await to see the recommendations and subsequent implementation in the new year.

The Clarion Employment Team wish you a Merry Christmas and a Happy New Year and hope that the changes being introduced in 2020 will be seamlessly implemented into your organisation.

Should you encounter any issues or have any questions or concerns with any of the matters raised in this blog, please get in touch to talk to us.

Disclaimer: Anything posted on this blog is for general information only and is not intended to provide legal advice on any general or specific matter. Please refer to our terms and conditions for further information. Please contact the author of the blog if you would like to discuss the issues raised.