2024 looks set to bring with it a number of significant reforms in employment law. In this article, we outline key changes that will affect employers, and consider how employers can best prepare.
Retained EU law
Since 2020, the Government has sought to manage the thousands of EU laws that continued to apply in the UK post-Brexit. On 1 January 2024, the principle of supremacy of EU law in the UK was abolished, a specified set of EU laws was revoked and new powers to reform EU-based employment laws were introduced.
In practical terms, this uncoupling of EU and UK laws will likely bring legislative and interpretative uncertainty into numerous areas of English law. Employers should be aware of this, as certain areas of English law are now potentially open to re-examination, especially those that were previously settled by EU-derived legislation or case law.
Holiday
The Working Time Regulations 1998 will undergo various changes in 2024, primarily to replicate the effect of EU-derived case law. The key updates are:
- simplification of record-keeping requirements: rather than keeping full records of daily working hours, records will need only be “adequate”.
- annual leave: permitting workers to carry over entitlements if they are unable to take it due to family leave, sick leave, or failure of an employer to provide reasonable opportunity to take it.
- adjustments for irregular hours and part-year workers:
- introduction of a pro-rata method of calculating annual leave entitlement, calculated at 12.07% of the hours worked in the previous pay period; and
- introduction of rolled up holiday pay – i.e., the practice of employers paying workers an additional sum on top of their hourly rate of pay, whereby the additional sum represents their holiday pay. Rolled up holiday pay has been regarded as unlawful since 2006, as it disincentivises workers from taking leave, however the Government is re-introducing it for irregular hours and part-year workers.
- introduction of a pro-rata method of calculating annual leave entitlement, calculated at 12.07% of the hours worked in the previous pay period; and
Changes to requests for flexible working
New regulations will make the right to request flexible working a “day one” right for requests made on or after 6 April 2024. Before this time, an employee will still be required to have 26 weeks’ continuous service before making a request for flexible working.
In July 2024, further expected legislation will make the process of requesting flexible working more employee-friendly by:
- abolishing the requirement for employees to explain the effect that the requested change may have on their employer;
- introducing an employee entitlement to make two (instead of one) request per 12-month period;
- prohibiting employers from refusing a request unless they have first consulted the employee; and
- reducing the employer decision-making time in respect of a request from three months to two months.
Employers should ensure they have a clear flexible working policy in place which (i) complies with the new regulations by the time they come into force and (ii) is consistently followed.
New employer duty to take reasonable steps to prevent sexual harassment
In October 2024, new legislation will impose a duty on employers to take “reasonable steps” to prevent sexual harassment of their employees in the workplace. The legislation will give employment tribunals the power to provide an uplift of up to 25% compensation where an employer has failed to fulfil this duty.
Employers are advised to consider if internal policies meet the requirements of this duty ahead of the legislation taking effect. Each employer’s situation will vary, but potential steps could include: (i) reviewing and updating relevant policies and ensuring these are available to all staff; (ii) reviewing record-logging and reporting procedures to ensure any complaints are properly logged and investigated in a manner compliant with data protection laws; and (iii) providing regular, tailored training for staff at all levels of seniority.
Changes to TUPE consultation
For TUPE transfers taking place on or after 1 July 2024, new regulations will mean that employers no longer need to elect employee representatives (and can consult directly with employees) where:
- the employer has fewer than 50 employees; or
- a proposed transfer involves fewer than 10 employees.
This only applies where no existing employee representatives are already in place.
Amendments to the Equality Act 2010
A number of amendments to the Equality Act 2010 (the “Act”) became effective on 1 January 2024, to preserve rights that were previously incorporated in the Act through EU-derived legislation and case law. Some of the key changes include:
- increased protections for women against pregnancy/maternity discrimination to extend protection against unfavourable treatment during a “protected period” (which is usually from the start of pregnancy to the end of maternity leave) to protection against unfavourable treatment that occurs after the end of the “protected period” if it is because of pregnancy or pregnancy-related illness which occurred during the protected period;
- protections against discriminatory recruitment statements, applicable even where there is no active recruitment process and no identifiable victim;
- equal pay protections where workers are governed by terms attributable to a “single body” rather than a single employer; and
- improved protection for disabled people, as the definition of disability is extended to include a person’s “ability to participate fully and effectively in working life on an equal basis to other workers”.
Extended redundancy protection for pregnant women and new parents
Employees on maternity, adoption or shared parental leave who are in a redundancy situation qualify for “priority status”, which means they have the right to be offered a suitable alternative vacancy ahead of other redundant employees. From 6 April 2024, employees who are pregnant, have recently suffered a miscarriage or have recently returned from maternity, adoption or shared parental leave will also qualify for “priority status”.
Employers should be aware that the number of employees with “priority status” in an organisation may substantially increase. As such, employers should pro-actively consider any practical difficulties that may arise in future redundancy processes, especially if they are planning an imminent restructuring process.
Carer’s leave entitlement
As of 6 April 2024, a new carer’s leave entitlement will provide one week of unpaid leave per year for employees to provide or arrange care for a dependent with a long-term care need.
Employers should consider whether policies will need to be drafted or updated to account for this development. Employers should also ensure relevant members of staff receive training to properly deal with requests of this nature.
If you are a multinational employer and would like to discuss any of these key changes in further detail, or if you have any specific questions, please contact Partners Beth Hale and Emma Bartlett or Associate Kia Aoki, who specialise in employment law issues for multinational employers, senior executives, partnerships, LLPs, partners and LLP members.
