Your Spring HR update

What is the sunset clause and proposed employment law changes?

The government has recently announced a reversal of its previous intention to automatically revoke almost all EU law at the end of 2023 (known as the “sunset clause”) meaning that EU law will instead remain binding in the UK unless the government legislates otherwise. In respect of proposed employment law changes, the government has so far announced the following:

• amendments to the Working Time Regulations to merge the entitlement to ordinary annual leave and additional annual leave to create one single statutory entitlement. The overall entitlement of 28 days will be maintained. It is also proposed the requirement to maintain records of working hours will be removed.

• allowing employers to ‘roll-up’ holiday pay whereby workers receive additional pay as part of their basic pay to reflect an amount for holidays accrued, a practice which has been technically unlawful under EU law.

• removing the requirement to elect employee representatives for the purpose of TUPE consultation for businesses with fewer than 50 employees or where the transfers affects fewer than ten employees.

• the introduction of a limit on the duration of non-compete clauses to no more than 3 months. This proposal would represent a significant change to non-compete restrictions although it is not clear whether a non-compete longer than three months would become entirely void or only enforceable up to the 3 month limit. Other restrictions such as the non-solicitation of clients and employees wouldn’t be impacted.

There has not yet been a suggested implementation date for these changes.

ACAS warning of redundancies

ACAS has found that 30% of employers are likely to make redundancies in the next twelve months. The survey found that large employers, with at least 250 employees, are more likely to make redundancies in the next twelve months, with 41% responding that they are likely to do so. This is compared to 20% of small and medium sized businesses that are likely to do the same. It is important employers take full advice in respect of their redundancy consultation obligations to minimise the risk of employees pursuing unfair dismissal claims and protective awards for up to 3 months’ pay where there has been a failure to collectively consult.

Allocating tips

Legislation is set to be introduced next year which will create new legal obligations for employers, who will be required to fairly allocate tips over which they exercise control or significant influence and pay them to workers in full within a month of the payment being made by a customer. The government intends to issue a statutory Code of Practice on the fair and transparent distribution of tips which employers must follow. Record keeping obligations will also be introduced.

If you would like advice on the above, or any other employment law issues, please get in touch on 0191 232 8345 or submit our contact form.