Employment law is there to protect employers and employees alike, ensuring fairness and safe working conditions for everyone. The shifting nature of the world of work means that employment law changes frequently, so it’s important to keep on top of the latest developments and what they mean for your business.
In this article we will be covering:
- Who is affected by employment law changes?
- New employment law updates in the UK
- Changes to mitigate employers using fire and rehire tactics
- COVID-19 in the workplace
- Minimum wage increases
- Increase in statutory family-related pay and sick pay
- Gender pay gap reporting
- Increase to compensation limits
- What does the employment bill 2022 mean for employers?
- How is your business handling the changes to employment law?
Who is affected by employment law changes?
However large or small your business, you have a legal obligation to abide by the government’s employment law at all times to protect your workers. The decisions made by HR, leadership and management teams have a far-reaching effect, and can impact every aspect of employees’ lives both inside and outside the workplace, especially with the increase in hybrid and flexible working.
From determining a living wage to ensuring fairness in any grievance procedures, adhering to guidelines outlined by the employment law bill is more than just a legal requirement; meeting these standards also helps businesses to provide the best possible experience for workers, boost employer-employee relationships, and nurture staff retention.
New employment law updates in the UK
When employment law changes come into effect, employers need to be aware and make the necessary adjustments to ensure compliance with new legislation. Let’s look at the employment law updates 2022 has seen so far, and what they mean for employers.
Changes to mitigate employers using fire and rehire tactics - Effective 29th March 2022
This new Statutory Code of Practice is designed to clamp down on ‘fire and rehire’ tactics. This is when an employer dismisses an employee, only to rehire them on terms that are less favourable to the employee. It’s an unscrupulous way for employers to get a better deal for themselves without engaging in fair negotiations.
In November 2021, Acas (the Advisory, Conciliation and Arbitration Service) published guidelines stating that employers should make all reasonable efforts to reach a mutual agreement before resorting to fire and hire tactics. This means trying to reach an agreement through meaningful, transparent discussions when looking to change employment terms, and only opting for fire and hire as a last resort.
However, in light of P&O Ferries unexpectedly firing 800 employees over Zoom earlier this year, the government developed a new Statutory Code of Practice to clarify what exactly is expected of employers when seeking to change employees’ terms and conditions, and setting a legal precedent should these expectations not be met.
COVID-19 in the workplace - Effective 1st April 2022
The UK government’s ‘Living with COVID’ plan moves away from the ‘Working Safely’ guidance, instead encouraging employers to make their own assessments and arrangements for COVID-19 considerations in their workplace. This choice has been made to “empower businesses to take responsibility for implementing mitigations that are appropriate for their circumstances.”
There are two significant changes that employers must factor into their approach to COVID-19 in the workplace. First of all, workers who test positive for COVID-19 are no longer legally required to self-isolate, although they are advised to “try” to stay at home for five days after their test result. For employers, it’s important to balance the safety of their staff and members of the public with the requirements of running their business. Enabling home working wherever practical and revising sick leave policies are important considerations to support the Living with COVID plan.
Secondly, lateral flow tests are no longer provided free of charge, which may make regular testing unaffordable for some workers. Without testing, employers cannot know whether workers have COVID-19. The government has not provided any advice to employers with regards to employee testing, so it is up to each individual organisation to decide whether to provide free tests for their employees, and under what circumstances.
Minimum wage increases - Effective April 1st 2022
From April 1st, the hourly national minimum wage rates increased to:
- £9.50 for workers aged 23+
- £9.18 for workers aged 21–22
- £6.83 for workers aged 18–20
- £4.81 for workers aged under 18
- £4.81 for apprentices under 19, or 19+ in the first year of the apprenticeship
Employers must make sure to adjust their employees’ wages in line with the new rates for the first pay period beginning on or after April 1st.
Now is a good time to review your current pay rates. While these are the minimum wage rates, organisations offering more than is legally required of them will be better able to attract and retain staff.
Increase in statutory family-related pay and sick pay - Effective 3rd - 6th April 2022
From April 3rd, the UK Government increased statutory maternity, adoption, paternity, shared parental and parental bereavement pay to £156.66 per week. Statutory sick pay was also increased on April 6th, rising to £99.35 per week.
For employers and HR professionals, it’s important to review your company’s existing policies and update them to reflect the new rates. Any staff already on family-related or sick leave when the new policy went into effect must be paid the new statutory rate from the first eligible day.
Gender pay gap reporting - Effective April 4th 2022
Organisations with 250 or more employees in England, Scotland and Wales are legally required to publish their gender pay gap data annually.
The report must be published on the organisation’s website as well as GOV.UK’s gender pay gap reporting portal. The deadlines set out for publishing the reports was March 31st for the public sector and April 4th for private, voluntary and all other public authority employers.
This is an important opportunity for employers to take positive action towards gender representation, and should not simply be viewed as a box-ticking exercise. Employers may choose to accompany the report on their website with a narrative explaining any pay gaps and outlining the steps that they are taking to close them, helping to improve their reputation and build their Employer Brand.
Increase to compensation limits - Effective April 6th 2022
From April 6th, the limits for certain compensation and statutory payments were increased. These amounts are used to calculate statutory redundancy pay, the basic award for unfair dismissal, and various other employee compensation payments.
The following rates will apply to dismissals taking place on or after 6 April 2022:
- The maximum amount of a ‘week’s pay’ increases to £571
- The maximum compensatory award for unfair dismissal increases to £93,878
- The limit on the daily amount of guarantee payments increases to £31 per day
- The minimum basic award in cases where a dismissal is unfair by virtue of health and safety, employee representative, trade union, or occupational pension trustee reasons increases to £6,959
What does the Employment Bill 2022 mean for employers?
To remain compliant with the Employment Bill 2022 as an employer, you must:
- Make sure that you understand your legal obligations
- Take steps to meet these obligations at all times
- Work proactively to review and update your policies to ensure compliance
- Provide staff with updated policies in a timely manner
- Take legal responsibility for noncompliance
How is your business handling the changes to employment law?
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