A new year brings new hope. Lots of you are making New Year’s resolutions around fitness and health, or business progression and personal development. Professionally, you might want to improve your skills or increase your income. Perhaps you’ll succeed. Perhaps you will not. It’s difficult to anticipate.
But there are some things about 2020 we can predict, such as changes in legislation. It happens every year. Time moves on, things change, and we must change with them.
So, push aside your dedication to your resolutions for a little while and read our guide to legislation changes that might impact your company this year. Brace yourself!
From April 6th, 2020, the original IR35 legislation, set up to discourage organisations from masquerading staff as contractors to avoid paying tax, will be replaced with the off-payroll tax (which is also known as IR35). It means that you as an organisation will be responsible for investigating whether any contractors you have are considered staff members and, if they are, you’ll need to pay their taxes.
We wrote an article on this recently, which you can find here.
If you’re a small business, the situation remains the same and you don’t have to do anything, but medium and large-sized companies will be responsible for considering and implementing necessary changes. We suggest you carefully study the new guidelines and, if necessary, seek legal advice. The consequences for flouting the new rules are severe.
From April 6 2020, all employees whose employment lasts at least one month are entitled to receive the conditions of their employment in writing on or before the first date of their employment. You currently have two months to provide this information and you only need to provide it to employees, but that’s all about to change.
Some of the information you were previously allowed to provide staff in a supplementary statement you will now have to provide in a principle statement, such as notice periods for termination by either side, terms relating to absence due to incapacity, and sick pay.
You don’t need to give existing employees the additional information as a matter of course, but the new rules apply to all new workers and employees. Seek legal advice if you need help defining the terms.
Parental bereavement Leave and Pay Act
If an employed parent loses a child under the age of 18 or suffers a stillbirth from 24 weeks of pregnancy, they’ll be entitled to day-one leave of two-weeks. If they meet the eligibility criteria, they’ll also be entitled to claim pay for this period. You must make sure that your employment contracts are updated accordingly and that you follow these rules if an employed parent suffers a loss.
The Swedish derogation
The Agency Workers Regulations 2010 were introduced to protect agency workers. They stopped employers from offering agency staff worse working conditions than they were offering their permanent employees. Unfortunately, a Swedish derogation contract allows recruitment agencies to employ a worker on a permanent contract rather than the client and give them a lower salary, less employment benefits, and four weeks reduced pay between assignments.
From April 6th, 2020, all agencies and workers must work in accordance with the Agency Workers Regulations 2010.
You can’t do much about what your agency is paying your worker and you aren’t expected to, but you will be required to ensure that anybody who works for you enjoys the same working conditions as your permanent members of staff.
New rules for calculating holiday pay
For workers with variable pay, holiday pay calculations are usually calculated using the rate of pay they received during the 12-week period prior to the holiday, but that’s about to change.
An amendment to regulation 16 of the Working Time Regulations 1998 means that from April 6 2020, you’ll need to reference 52 weeks when calculating holiday pay (or the number of weeks that they’ve been employed if it is less than 52 weeks) in order to better reflect their normal pay.
Information and consultation thresholds
Subject to certain conditions, employees have the right to request that their employer consults with them about issues within the business. Previously, 10% of employees (and a minimum of 15) were required to make a valid request for employers to set up information and consultation arrangements, but that threshold is reducing to 2%.
It’s important that you’re prepared for such a request, so read over the negotiation procedure in the ICE Regs in advance and seek legal advice if you’re not sure how best to get ready.
Employment law is complicated and new rules and regulations are often a minefield, so it’s always best to check with a professional if you think new legislation might impact your business. Failure to comply can be costly, and the rules are there to protect the rights of your employees, which we’re sure you want to do, too.
For more information or advice regarding these or any other issues, please contact JMR Solicitors on 0161 491 399 or firstname.lastname@example.org.