Equality Act Amendments – 1 January 2024

A pivotal update is on the horizon as we anticipate amendments to the Equality Act 2010. These amendments, encapsulated in the Equality Act 2010 (Amendment) Regulations 2023, not only reinforce existing discrimination protections but also introduce nuanced changes.

• Indirect Discrimination by Association: The legislation broadens the scope, expressly allowing claims of indirect discrimination by association. This means individuals not directly possessing a protected characteristic can claim discrimination if they suffer similar disadvantages from an employer’s policies, practices, or criteria.
• Definition of Disability: The definition of disability will explicitly include consideration of an individual’s ability to participate fully and effectively in working life when considering whether they can undertake ‘day-to-day activities.’
• Equal Pay Comparator – Single Source Test: The introduction of a ‘single source’ test for establishing an equal pay comparator. This test allows an equal pay comparator to potentially operate in a different business as long as the entity setting the terms remains the same.
• Extension of Direct Discrimination Protection: The protection against direct discrimination will encompass statements indicating a reluctance to recruit individuals with specific protected characteristics. This applies even when there’s no active recruitment process or identifiable victim.
• Breastfeeding Discrimination: A welcome clarification includes confirmation that discrimination related to breastfeeding is protected under the characteristic of sex.

Simplified Holiday Pay calculations – 1 January 2024

The Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023 aim to provide clarity for employers around some key pieces of EU derived law, many of which have been the subject of various case law, such as holiday pay calculations.

The proposed changes permit rolled-up holiday pay (at 12.07% of pay) for part-year workers and those with irregular working hours. This will come as a relief to many employers who have been stumped since the Harpur Trust v Brazel holiday pay decision earlier this year.

Other changes under The Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023 include:

• Retained EU Case Law Clarification: Various pieces of retained EU case law are restated to emphasise their continued relevance in UK law post-Brexit. This includes allowing the carryover of 4 weeks annual leave to the following year in cases where a worker is unable to take leave due to sickness or where they are prevented from taking all their holiday by the employer (for example, due to business demands). It also provides a welcome resolution to the current contradiction surrounding the carryover of holiday due to family related leave. Going forward, it will be clear that employees on family related leave will be entitled to carryover all of their holiday entitlement to the next holiday year.
• Expanded Definition of ‘Normal Remuneration’: For the 4 weeks of leave derived from the Working Time Directive, ‘normal remuneration’ for holiday pay calculations will include commission payments and other regular overtime payments, cementing the principles established over the years through various case law.
• Removal of Additional Record-Keeping Requirements: The onerous working time record-keeping requirements outlined in the ECJ judgment in CCOO v Deutsche Bank are removed. This decision alleviates a huge burden on employers, who are currently required to keep records of all working and rest time.
• TUPE Transfer Consultation Flexibility: Small businesses (with fewer than 50 employees) involved in TUPE transfers of any size, and those undertaking a small transfer (of fewer than 10 employees), gain the flexibility to consult employees directly if no existing representatives are in place.

Employer National Insurance Contribution – 6 January 2024

The government has announced a cut to the main rate of Class 1 employee NICs from 12% to 10% from 6 January 2024 and a cut to the main rate of Class 4 self-employed NICs from 9% to 8% from 6 April 2024.

It has also announced that no one will be required to pay Class 2 self-employed NICs from 6 April 2024.

Preventing Illegal Working – 22 January 2024

The Home Office unveiled key updates regarding fines for illegal working, which are scheduled to take effect from 22 January 2024. As part of this transition, a comprehensive draft code of practice on preventing illegal working has been presented, pending approval by Parliament.

This code will be instrumental in guiding all right-to-work checks, including follow-up assessments to maintain a statutory excuse. Employers should refer to this code as it will be taken into account by the Home Office when determining the level of any fine.

Here’s a glimpse into the essential aspects of the draft code:

• Establishing statutory excuse: The draft code explains how employers should conduct right to work checks in order to establish a statutory excuse against the civil liability for employing an illegal worker.
• Administration and calculation of civil penalties: Understanding how civil penalties are administered and calculated is crucial for businesses. The code provides insights into the mechanisms behind these penalties.
• Fine Structures: The Home Office confirms that the baseline for civil penalties will be £45,000 per worker for initial breaches and £60,000 per worker for repeated breaches. It’s noteworthy that reductions may be applicable under specific conditions. For instance, mitigating factors or prompt payment in full within 21 days for a first penalty could lead to a reduction.

Immigration changes – 31 January 2024

On December 7, 2023, the government released a policy paper titled “Statement of Changes to the Immigration Rules,” most of which will be enforced starting January 31, 2024. Below are the key reforms likely to impact businesses and migrant workers in the UK.

Employers should particularly note the changes to visitor rules which could potentially be very beneficial where you have employees based overseas who need to visit the UK.

The government has also reiterated previously announced measures, including:

• From January 2024, students, unless enrolled in post-graduate courses designated as essential research, will lose the right to bring dependants to the UK.
• The Immigration Health Surcharge will see an increase from £624 to £1,035 per year starting January 2024.

Visitors

Effective January 31, 2024:

1. Visitors will be allowed to work remotely while in the UK, as long as remote work is not the primary purpose of their visit.
2. The restriction on visitors engaging in intra-corporate activities directly with clients will be lifted. However, this is contingent on the client-facing activity being incidental to the visitor’s employment abroad and not constituting the offshoring of a project or service to their overseas employer.
3. Scientists, researchers, and academics will have the liberty to conduct research in the UK during their visit. This extends the current limitations, allowing scientists and researchers to only conduct independent research and academics to perform research for personal purposes while on sabbatical leave. Note that these changes do not apply to academics applying for a 12-month visit visa or those seeking an extension from within the UK.
4. Visiting legal professionals, including overseas lawyers, will have expanded permitted activities, such as providing legal services and participating in arbitrations.
5. Speakers at conferences will now be eligible for payment, incorporated into the list of Permitted Paid Engagements (PPE).
6. The PPE Visitor route provisions will be integrated into the Standard Visitor route, eliminating the need for a special visa for all visitors intending to undertake PPE. However, such visitors must have arranged their PPE activity before traveling to the UK and must complete it within 30 days of arrival as a Visitor.

Youth Mobility Scheme (YMS)

Effective January 31, 2024:

• The YMS route will be extended to eligible Uruguayan nationals, with a maximum allocation of 500 places for Uruguayan nationals in 2024. Applicants must meet standard eligibility criteria and provide a Certificate of Judicial Records issued within six months before the application date.
• The number of allocated places for nationals of Japan and the Republic of Korea will increase, and the requirement for them to obtain an invitation to apply will be eliminated. Additionally, the age range for nationals of the Republic of Korea will expand from 18-30 to 18-35.

EU Settlement Scheme (EUSS)

Effective January 16, 2024:

• Changes will be implemented to prevent a valid EUSS application as a joining family member by individuals with irregular arrivals to the UK, including small boat arrivals, and by illegal entrants.
• Visitors in the UK must submit any application to the EUSS as a joining family member within three months of their arrival, with allowances for reasonable grounds for any application delay.
• Limited leave to enter or remain granted under the EUSS may be curtailed, subject to appeal rights, if it is deemed proportionate, and the person never met the requirements of Appendix EU.

In a bid to reduce net migration to the UK, the government has announced new measures set to take effect in spring 2024. These will have a far reaching impact on employers who currently, or intend to, sponsor Skilled Workers.

1. Skilled Worker Visas The minimum salary threshold for Skilled Worker visas will rise by almost 50%, from £26,200 to £38,700 per year, or the going rate for the role if higher. Exceptions to this increase include individuals on the Health and Care visa route and those on national pay scales.
2. Shortage Occupation List The 20% salary discount for roles on the Shortage Occupation List, in line with previous recommendations from the Migration Advisory Committee (MAC), will be eliminated. Instead, a smaller list of shortage roles on an “immigration salary list” will be introduced, maintaining a general threshold discount. The MAC is tasked with reviewing this new list against the heightened salary thresholds to reduce the number of occupations on it.
3. Care Workers Care workers will no longer be permitted to bring dependants to the UK. Care firms in England seeking to sponsor visas must now be regulated by the Care Quality Commission.
4. Family Visas The minimum income threshold for family visas (e.g. spouses or partners of British or settled persons in the UK) will see a substantial increase from £18,600 to £38,700 per year, aligning with the new Skilled Worker minimum income threshold.
5. Graduate Route Review The MAC will conduct a review of the Graduate route to ensure it aligns with the best interests of the UK and is not subject to abuse.

These measures, if in place last year, would have impacted approximately 300,000 individuals who came to the UK. There are currently over 200 job roles eligible for Skilled Worker sponsorship, the increased salary threshold reduces this to just 15 roles.

If you are an employer who doesn’t already have a sponsor licence, there is very little time to apply, obtain one and sponsor a Skilled Worker before these changes come into force.

Please get in touch as soon as possible if you are looking to apply as we can support you with the process.

National Minimum Wage Increases – 1 April 2024

From 1 April 2024, the National Living Wage will increase by 9.8% to £11.44 an hour for eligible workers across the UK aged 21 and over.

Young people and apprentices on the National Minimum Wage will also see a boost to their wages, which will increase to £6.40 an hour. The accommodation offset will also increase, to £9.99 per day.

Carer’s Leave – 4 April 2024

The Carer’s Leave Regulations 2024 have been presented to Parliament, ushering in new right for employees.

Once in force (4 April 2024), employees will gain the entitlement to one week of unpaid leave annually for the purpose of providing or arranging care for a dependent with a long-term care need.

What the new right will:

1. Apply from day one of employment
2. Benefit employees who have a dependant with a long-term care need and want to be absent from work to provide, or arrange care for that dependant
3. Enable requests in consecutive, or non-consecutive, half-days or full days
4. Require employees to give notice, in writing, of their intention to take carer’s leave, confirming their entitlement to take it and giving the longer of three days’ notice or twice the amount of notice than the period of leave requested
5. Enable employers to postpone a request if the operation of the business would be unduly disrupted. Any rescheduling should be carried out in consultation with the employee. The employer must give notice of the postponement in advance of the leave and provide an explanation. The employee is then entitled to take the leave within one month of the original leave start-date.
6. Provide protection to employees from detriment and dismissal because they take, or seek to take, carer’s leave (or the employer believes they are likely to do so)

What the key terms mean:

Dependant

• spouse, partner, child, parent
• Lives in same household
• Reasonably relies on the employee to provide or arrange care

Long term healthcare need

• Physical or mental illness or injury that requires or likely to require more than 3 months care
• Disability; or
• Requires care relating to old age

Employers should prepare a Carer’s Leave policy and procedure in advance of April so that the entitlement and rules around it are clear. Whilst the right is to unpaid leave, employers can of course enhance the statutory leave, by paying all or part of the leave, and/or providing more than one week a year leave.

Flexible Working – 6 April 2024

The right to request flexible working is about to become a Day One entitlement.

This groundbreaking change is set to roll out for flexible working requests initiated on or after 6 April 2024. The wheels of this change were set in motion as early as 2022 when the government signalled its intent for this amendment. While it was absent from the Employment Relations (Flexible Working) Act 2023 unveiled earlier this year, the Flexible Working (Amendment) Regulations 2023 swoop in to fill this void.

The imminent changes are not merely symbolic; they signify a fundamental shift in the landscape of flexible working rights. The eagerly anticipated Employment Relations (Flexible Working) Act 2023, with its array of amendments, is poised to take effect on a date determined by the Secretary of State via a separate statutory instrument. All signs point to April 2024 as the likely start date, aligning seamlessly with the Day One right’s grand entrance.

In the meantime, Acas has confirmed that the final version of its statutory Code of Practice on handling flexible working requests will be published later in 2024. Employers should review their flexible working policies in line with the new Code.

Extended Redundancy Protections – 6 April 2024

More changes are on the horizon as the Maternity Leave, Adoption Leave and Shared Parental Leave (Amendment) Regulations 2024 take centre stage, ushering in a new era of extended protection from redundancy for employees on maternity leave, adoption leave, or shared parental leave.

The regulations, poised to bring the Protection from Redundancy (Pregnancy and Family Leave) Act 2023 into operation, mark a significant step toward fortifying the rights of parents during crucial life events.

Currently, regulation 10 of the Maternity and Parental Leave Regulations 1999 ensures that parents on maternity leave, adoption leave, or shared parental leave are given first refusal of any suitable alternative employment in a redundancy situation.

Under the new Act, this protection is extended in the following ways:

• For maternity: The protected period will now cover pregnancy and extend to 18 months from the first day of the estimated week of childbirth. Additionally, the protected period can be adjusted to cover 18 months from the exact date of birth if the employee provides notice of this date before the end of maternity leave.
• For adoption: The protected period will cover 18 months from the placement for adoption.
• For shared parental leave: The protected period will cover 18 months from birth, provided the parent has taken a minimum of 6 consecutive weeks of shared parental leave. This protection doesn’t apply if the employee is otherwise protected under maternity or adoption provisions.

Crucially, the extension to the protected period for pregnancy applies when the employer is informed of the pregnancy on or after 6 April 2024.

Moreover, the extension of the protected period after leave has been taken will apply to any maternity and adoption leave ending on or after 6 April 2024. This also includes shared parental leave starting on or after the same date.

Please note that the Regulations are currently in draft form and may undergo changes before finalisation.

Tip allocation – May 2024

Mostly affecting those in the hospitality sector, the Employment (Allocation of Tips) Bill has received Royal Assent and will become a 2023 Act.

The Act will ensure that more workers receive tips their employers would otherwise have held back, by introducing the following requirements:

• Employers must fairly allocate tips which they have control of, and pay them to workers within one month of receiving them from the customer
• Employers must have a written policy setting out how tips will be dealt with, where they are paid more than just on an occasional and exceptional basis
• There will be a statutory Code of Practice governing the distribution of tips, and employment tribunals will have regard to any failure to comply with the Code
• Records of the distribution of tips must be kept for 3 years and workers will be able to request such information

Agency workers will also be protected by the Act, and workers will be able to bring a claim in the employment tribunal for a failure to comply, within 12 months from a breach. This is a significant departure from practically all other employment law, which must be enforced within 3 months of the breach, or termination of employment.

Many employers already have fair practices in place for distributing tips, but all affected employers should have regard to the specifics of the new Act, and in particular the Code of Practice, to avoid being caught out.

Predictable Hours – September 2024

The new Workers (Predictable Terms and Conditions) Act 2023 will introduce the right for workers to request predictable terms, expected to come into effect around September 2024.

The Act introduces a pivotal statutory right, allowing workers (including agency staff) to request a more predictable work routine. The request procedure mirrors the current structure for flexible working requests: written submissions that can be declined based on specified grounds, like additional costs or potential adverse impacts on recruitment or business operations due to the requested changes.

In the meantime, Acas has launched its consultation into a draft Code of Practice for managing requests for predictable working patterns. This code will run parallel to the Workers (Predictable Terms and Conditions) Act 2023.

Under the Act, different protocols apply based on whether the request is coming from an employee/worker to their employer or from an agency worker to their agency or hirer. ACAS is particularly interested in insights on how these distinct processes should be incorporated into the Code of Practice.

Outlined in the draft Code are essential good practices, such as permitting workers to have a companion during discussions, the necessity for organisations to provide additional reasonable information regarding their decisions, and the option for an appeal if a request faces rejection.

While the Code won’t be legally binding, it will weigh significantly in the eyes of courts and employment tribunals when handling relevant cases.

Preventing Sexual Harassment –  October 2024

The Worker Protection (Amendment of Equality Act 2010) Act 2023, which will come into force on 26 October 2024 and will:

• introduce a new duty on employers to take reasonable steps to prevent sexual harassment of their employees.This marks a shift towards prevention with employers having to take steps to be proactive, rather than reactive.
• give employment tribunals the power to uplift sexual harassment compensation by up to 25% where an employer is found to have breached this new duty – this uplift could be significant, especially as compensation awarded in the most serious cases of sexual harassment can exceed £50,000.

Neonatal Leave & Pay

The Neo-natal Care (Leave and Pay) Bill and Protection from Redundancy (Pregnancy and Family Leave) Bill get the green light and gain Royal Assent.

The Neo-natal Care (Leave and Pay) Bill will allow parents’ whose newborn baby is admitted to neo-natal care to take up to 12 weeks of paid leave in addition to maternity/paternity leave.

The leave will apply if their baby receives neo-natal care for more than 7 continuous days in a 28 day period, and the period of leave & statutory pay will be dependent on how long the baby receives neo-natal care.

The leave will be available from day 1 of employment.

We’re awaiting further information on when this will come into force, it may be late 2024 or 2025.