What's in store for employment law under new PM?

More than two years on from the Employment Bill having been announced, we still have no idea when or whether the proposals contained within it will become law. Reference to the Bill was notably absent from the Queen's Speech on 10 May this year. Flexible working rights were set to be strengthened, protections for women facing redundancy during or shortly after pregnancy, as well as there being proposals to create a single enforcement body for vulnerable workers, alongside a right for workers to request a more stable working pattern. Commentators, including the TUC, have suggested that these rights risk being ditched for good.  

Liz Truss, the UK's new Prime Minister has vowed to scrap all EU regulations by the end of 2023 (a much tighter timescale than had previously been suggested) which would include EU derived employment laws during her leadership campaign. Each EU law would be "evaluated on the basis of whether it supports UK growth or boosts investment" and if they did, they would be replaced with new domestic law. Unions have warned that this could impact on current protections for workers. One area that may be reviewed is the EU Working Time Directive's limits on weekly working hours, and how employers calculate holiday pay and leave.

The new PM has also confirmed that she would review the off payroll working rules which replaced the IR35 regime in April 2021 and were introduced in the private sector to prevent NI and tax avoidance by the interposition of an intermediary between a client and worker. Her view is that the new rules catch the genuinely self employed as well as employees, despite their lack of rights to the same benefits.

In terms of reforms to UK trade union laws, the PM has pledged to introduce legislation to require some provision of services during industrial action and raise the threshold on the number of workers required to participate in ballots on industrial action from 40% to 50% of members.

Government Response to employment status review

The Government states that it wants to increase transparency for individuals on their employment status, empowering them to claim the rights they deserve whilst providing enhanced clarity on what employers’ rights and responsibilities are so it published employment status Guidance for employment rights along with the Response, for HR and legal professionals, support for individuals and a checklist for employers and other engagers. It is also updating the ‘Calculating the Minimum Wage’ guidance to clarify the correct interpretation of working time for National Minimum Wage purposes for platform workers, addressing delays in the employment tribunal system and committing to ensuring employment status frameworks remain fit for purpose, especially in the light of challenges posed by Covid-19 disruption.

OTS to review tax implications of hybrid and remote working

Last month the OTS published a Call for Evidence: Review of hybrid and distance working looking at changes in practice and emerging trends, such as increased working across borders and any tax complexities which may arise either for individuals or companies. The review will focus on hybrid and home working within the UK, trends in both employees of overseas employers working in the UK and for employees of UK companies working overseas (not on formal expatriate assignments) and impacts on the practices of the self-employed. The deadline for responses is 25 November 2022.

CIPD report on parental leave provision and policies

The CIPD comments that take-up of shared parental leave, introduced in 2015, continues to be very low with "recent estimates suggest that just 2% of eligible couples made use of shared parental leave last year". Its Report "Employer focus on working parents: Parental leave and pay and childcare policies" was published last month after surveying 2,000 senior decision makers in the UK.  Key findings were that about half of organisations have a paternity or partner leave policy, but it only provides a statutory minimum leave entitlement and a third only provide statutory minimum pay. However half of organisations said they would support extending paternity leave and pay. Organisations did report that introducing free childcare for older pre-schoolers has increased the number of women returning to work but that this could be improved by extending this benefit to all children aged 0-2 too. In addition to making these recommendations to the Government, CIPD also advocates that the right to request flexible working be a right from day one of employment (currently after 26 weeks) and remove the limit to one request every 12 months.