The first month of the year is a great opportunity to look forward to the year ahead, and put plans in place to achieve your goals. So that your 2019 HR plans can be designed with upcoming employment law updates in mind, we’ve taken a look at the changes anticipated for the year ahead and made recommendations on practical steps that you can take to be prepared for these developments.
With Brexit negotiations continuing, there is some uncertainty with regards to the status of EU nationals. Regardless of whether Britain leaves Europe with a deal or not, the rules surrounding the employment of EU nationals is likely to change sooner or later.
When the UK leaves the EU, free movement will end but this could be delayed, pending new legislation. It’s also likely to take time to put practical arrangements in place. This month, the government introduced a scheme under which EU workers already in the UK will be able to apply for “settled status”, to be able to live and work in the UK indefinitely. This is currently in a voluntary test phase but is due to become fully open to applicants on 30 March 2019. Anyone who doesn’t apply by 30 June 2021, when they should have, will no longer be living in the country legally.
It’s important, therefore, for employers to be aware that in the future, the employment of EU nationals is likely to be subject to similar restrictions in the same way as the employment of other foreign nationals. You’re advised therefore to review your recruitment procedures to ensure you’re undertaking the necessary checks when taking on new employees. It’s also recommended that you also undertake an audit of your existing workforce, making sure you have all the right paperwork in place and ensuring that you have processes in place to remind EU nationals to have completed their applications by 30 June 2021.
2. Executive pay reporting
From 1 January 2019 UK companies with more than 250 employees will have to report on ratios between the CEO and employees’ pay and benefits.
This requirement will apply to financial years starting on or after 1 January 2019 so the first reporting will start in 2020. You’re advised however to start collecting evidence and reviewing the data in good time in order to be prepared to report on the ratios by the deadline.
3. Extend itemised pay statements to workers
With effect from 6 April 2019, all workers will be entitled to receive itemised pay statements/payslips.This right currently only applies to employees. If you’re unsure of the difference between an employee and a worker, an employee is a person employed under a contract of employment. A worker who is not an employee is a person who works under a contract whereby he or she “undertakes to do or perform personally any work or services for another party to the contract whose status is not … that of a client or customer” (s.230(3) of the Employment Rights Act 1996).
A worker, therefore, is not an employee if he or she is free to accept or reject any offer of work made to him/her and, if the work is rejected, there is no penalty as a consequence. More guidance on this can be found here: Employment Status.
In addition to this, where a staff member’s pay and hours vary, employers will need to include on the itemised pay statement the total hours worked in line with the pay received.
Further guidance on this legislation can be found in the Government’s guidance on payslips from April 2019.
4. Be aware of national minimum wage rate increases
From 1 April 2019 the national living wage is due to increase to £8.21 per hour.
Other national minimum wage rates are also due to increase as follows:
- £7.70 for workers aged at least 21 but under 25
- £6.15 for workers aged at least 18 but under 21
- £4.35 for workers aged under 18 who are no longer of compulsory school age.
- The hourly apprentice rate will increase to £3.90 and the daily accommodation offset will increase to £7.55
5. Increased statutory pay rates
It’s expected that the weekly pay rates for statutory family pay will increase to £148.68 for 2019/2020. This rate will apply to maternity pay, adoption pay, paternity pay, shared parental pay and maternity allowance. The increase has usually taken place on the first Sunday in April which will fall on 7 April 2019 this year.
From 6 April 2019 it is expected that the weekly rate for statutory sick pay will increase to £94.25.
6. Parental bereavement leave and pay
The government has confirmed that it will be introducing a right for bereaved parents to take paid time off work. The proposals currently provide bereaved parents with the right to take leave as a single two week period, as two separate periods of one week, or as a single week. Parents will have 56 weeks from their child’s bereavement to take the leave.
This is expected to come into force in April 2020, but you may wish to start preparing for this in 2019 and to update your policies or consider introducing your own bereavement leave policy if this is not in place already.
7. Future developments
There are a number of other possible employment law updates on the horizon to keep in mind, some of which are detailed below.
- Requirement to publish family friendly policies – the government is currently consulting on a proposal to make companies with more than 250 employees publish their family friendly policies online.
- Duty to consider whether roles can be carried out flexibly – while employees already have the right to request flexible working, the government will be consulting on proposals to create a duty for employers to consider whether a job can be done flexibly and make that clear when advertising a role.
- Ethnicity pay reporting – the government will consult on the possibility of introducing ethnicity pay reporting, similar to gender pay gap reporting, for large companies.
If you would like any support to ensure your policies and practices are up to date with the latest employment law, contact our team today on 01271 859 267 or email email@example.com.