11 Jan 2021
2020 is not likely to be a year that we forget in a hurry. The impact of the coronavirus pandemic changed the working world. That said, it was already going to be a busy year for employment law.
The expected implementation of the Good Work Plan in April marked a shift in employment law. The ever-present Brexit developments were at the forefront of employers' minds as January dawned. With this in mind, you may be forgiven for not focusing on the other major changes that have taken place.
Here, we take a look at the changes that are likely to have a lasting impact on HR and employment law in the months and years to come…
Key developments of 2020
CEO pay ratio reporting
From 1 January 2020, UK listed companies who have in a year, on average, more than 250 employees were expected to participate in CEO pay ratio reporting. This means you must compare CEO's most recent remuneration against that of full-time employees.
The purpose of this was to allow transparency of remuneration policies across organisations.
If you are eligible for this type of reporting you must provide explanatory explanation with the report. This will allow interested parties to understand how and why your executive pay differs from other full-time workers.
This is now an annual requirement—meaning you’ll need to provide this report each year.
Not sure if you’re eligible? If you company is quoted on one of the following, you’ll need to provide a report:
- The UK Official New York Stock Exchange
- Stock Exchange in the European Economic Area
Companies listed on the Alternative Investment Market do not fall within this category.
The Good Work Plan
In July 2017, former Labour MP Matthew Taylor published a report on modern working practices. It focused on the reasons behind productivity issues in the workplace. Within the report, he recommended several changes to employment law. The aim was to improve conditions within companies, which led to several consultations held by the Government. Their response was the Good Work Plan. This plan confirmed key dates for the implementation of numerous new laws.
From 6 April 2020, the following came into effect.
- A statement of main terms of conditions (SMTs) had to be provided from day one of employment to both employees and workers. Previously, this was only required to be provided to employees, and employers had two months in which to do so.
- SMTs also needed to contain additional details for the first time:
- the terms and conditions relating to work extended. Now they must cover terms relating to normal hours of work, days of the week the worker will be required to work and whether these days/hours may vary
- terms relating to other forms of paid leave such as family-friendly leave
- details of other employee benefits, not just those relating to pay, such as benefits in kind or financial benefits
- terms relating to probationary periods including those in relation to length and conditions
- details of training provision and requirements.
- The holiday pay reference period, which is used to calculate the average pay of those who work irregular hours, was extended from 12 to 52 weeks. The aim of this development was to provide a fairer approach to holiday pay when workers are carrying out flexible hours.
- Agency work-seekers were given right to receive a key information document. This would help them make informed choices about the work they accept. This document is required to clarify specific matters. This includes the type of contract the worker is employed under and their minimum rate of pay.
- Employers were also no longer able to make use of Swedish derogation contracts for agency workers. These contracts allowed employers to avoid providing agency workers with equal pay after 12 weeks' of an assignment. Now they are unlawful. All agency workers will become entitled to equality of pay, when compared to comparable full-time employees. This happens once they reach 12 weeks' service within one assignment. Employment businesses had to notify their agency workers of this change by providing them with a written statement by 30 April 2020.
Parental Bereavement Leave
From 6 April 2020, working parents were given the right to take statutory leave following the loss of a child. The child must be under the age of 18, or a still-birth after 24 weeks. Previously, there had been no rights afforded to employees to take any sort of bereavement leave. Whether this was permitted was purely down to an employer.
Employees can now take up to two weeks of leave within 56 weeks of their bereavement. This right begins from the first day of employment. They can take this leave in blocks of one single week, two separate blocks of one week of leave, or two weeks together. If they’ve worked for you for at least 26 weeks, they may also be entitled to statutory bereavement pay. The rates for this being set at other family leave amounts.
As the pandemic raged, many began to ask if Brexit would be delayed as a result. However, the Government remained firm that this would not be the case. They confirmed in July what new immigration laws would look like following the end of the transitional period. From 1 January 2021 the majority of individuals looking to work in the UK are expected to take the “skilled worker route”. This involves them attaining at least 70 points through meeting certain criteria. You can find out more about how immigration laws will work in 2021 here.
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