Employment Law Update September 2024

Following the Labour government’s success in the general election on 4th July 2024 they have been making progress towards the employment law changes outlined in their manifesto and their Plan to Make Work Pay.

Employment Law Update

For now, here is an outline of some of the key changes on the horizon which we covered in our our July blog: Employment Law: What to expect from the new Labour Government. – New Dawn Resources

Pay

  • From October 2024 there will be a duty for employers in the hospitality sector to ensure that all tips are passed on to staff. Again, this legislation was already underway when the Labour government came into power.
  • It is likely that the National Minimum Wage will be increased to reflect the government’s commitment to ensure a “genuine living wage” and that the age bands will be reduced such that all workers aged 18 and over will become entitled to the same rate of pay.
  • It is expected that employees and workers will become entitled to Statutory Sick Pay from the first day of any sickness absence, removing the current waiting period of 3 days. The government has also indicated an intention to introduce paid carers leave and paid bereavement leave, though further details are to be confirmed.
  • Unpaid internships are likely to be banned other than where they form a recognised part of an education or training course.

Employment Status and Contracts

  • There will be a consultation on the possibility of removing the distinction between “employee” and “worker”. Currently, employment law recognises three distinct categories of staff: employees, workers and self-employed. Workers have greater flexibility and are subject to fewer controls, but they also have fewer rights. By removing the category of worker, the government will extend employment rights and protections to a wider section of the workforce.
  • There is likely to be a clamp down on “bogus” self-employment and increased protection for self-employed people. This may include the right to have a written contract, an ability to take action to tackle late payments and a right to remove their labour in the event of health and safety concerns without facing a detriment.
  • It is no longer expected that zero-hour contracts will be banned, however it is expected that all employees and workers will have the right to a contract that reflects the number of hours they work based on a 12-week reference period and reasonable notice of any changes to shifts or working time, which is likely to reduce the number of staff who remain on a truly zero-hour arrangement.
  • The requirement for a minimum period of service will be removed from certain employment rights, including the right to bring a claim for unfair dismissal. This will increase the protection for employees and consequently increase the risk of a claim for employers where an employee is dismissed in the first 2 years of employment. It is expected that employers will still be able to use contractual probationary periods to assess new starters and to fairly dismiss within a framework – though we await more information on this and further consultation with the business community.

Discrimination

  • From October 2024 there will be an increased duty for employers to take reasonable steps to prevent sexual harassment in the workplace, which comes with possible penalties in the event of a claim. This legislation was already underway when the Labour government came into power, but there is an indication that they may increase the scope of it. 
  • In order to tackle the gender, pay gap, it is expected that larger employers will be required to publish action plans for how they plan to close their gender pay gap (in addition to their current obligation to report data on their gender pay gap). It is also expected that employers will be required to report data on both ethnicity and disability pay gaps.
  • The Plan to Make Work Pay indicated an intention to require larger employers (those with more than 250 employees) to produce menopause action plans setting out how they will support employees through menopause. There has been no further guidance on this as yet, but it is something to keep an eye out for.

Flexibility

  • The requirement for a minimum period of service in order to request flexible working arrangements was removed under the Conservative government. The Labour government have indicated an intention to go further by introducing a requirement for flexible working arrangements to become the default where this is practical.
  • It is also expected that that a Code of Practice setting out a right for home workers to “switch off” will be introduced.
  • There has been a lot of coverage of this over recent weeks and last week we looked at the the difference around flexible and hybrid working currently as a reference. It’s time to distinguish between Flexible and Hybrid working.

We will be holding our annual Employment Law Update on 7th November 2024 and will have a good look at what employers can expect to come into force in the short and longer term.

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