Shortly after the Covid19 lockdown began there were some significant employment law changes. These came into force from 6 April 2020:
- Employers must now provide a written statement of terms of employment on or before the first day of employment. Previously an Employer had 2 months in which to provide the statement.
- The written statement of terms of employment must now contain additional information. In particular the additional required content involves the following:
-Greater clarity is required around the days of work
-Details of the probationary period must be included, if there is to be one
-Details of any entitlement to paid leave, aside from annual leave
-Details of non-salary benefits
-Detail about training entitlements and requirements - “Workers” (i.e. those who are self-employed, but not operating a business) must now be given the written statement of terms of employment. This right was previously reserved for those who had a contract of employment (“Employees”). Workers have a limited range of employment rights (e.g. national minimum wage, paid annual leave, pay slips and pay protection). From April 2019 they became entitled to payslips and now they are entitled to a written statement of employment particulars. In crucial ways these terms and conditions will differ from those given to Employees and employers must be careful not to confuse their Employee terms with their terms for Workers or vice versa. For example, now that the statement must contain detail of paid leave entitlements, an Employee’s statement should refer to maternity leave rights, whilst a Worker’s statement should not.
- The reference period to calculate holiday pay for those Employees and Workers whose pay varies (e.g. because of varying hours or because of varying commission), increased from 12 weeks to 52 weeks. This is a fairer way of calculating average pay which should avoid seasonal fluctuations.
- The Parental Bereavement (Leave and Pay) Act 2018 came into force, giving 2 weeks’ leave and 2 weeks’ statutory pay for parents who are bereaved by the death of a child under 18. The right is subject to a qualifying period of 26 weeks and the employee being paid more than the lower earnings limit. The statutory pay is currently £148.68.
- Employers must now pay class 1A NICs on termination payments above the £30,000 threshold. This can substantially increase the cost of large settlement payments. E.g. an employer making a £100,000 ex-gratia termination payment will now have to pay £9660 class 1A NICs, whereas previously they paid zero.
- Where 2% of employees (or 15 in total if greater) in an organisation with more than 50 employees request an information and consultation body an employer must consult with them to achieve this. The threshold was previously 10% and lowering the threshold is an attempt to increase uptake of this right. This right was intended to give self-organising workforces a platform for consultation with their employers which did not rely on Unions.
- The limit for a week’s pay for statutory redundancy purposes was raised to £538 and other limits and the national minimum wage rates were uprated.
One change that was expected but which was at the last moment put back by one year, until April 2021 was the change to IR35 introducing the Off-Payroll working rules into the private sector.
