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2020 will see some changes in employment law legislation that businesses should already be aware of.

 

Although many employment law developments in the UK have been put on hold due to the complexities of Brexit etc. there are still some important changes in 2020 that businesses should start preparing for.

 

Right to a Written Statement of Terms

 

Currently, employees who have been continuously employed for more than one month must be provided with a written statement of terms within two months of employment commencing.

 

From 6 April 2020, all new employees and workers will have the right to a statement of written particulars from their first day of employment and additional information will have to be included as part of the extended right. Employers should therefore begin preparation of the revised statement of particulars during the recruitment stage and ensure that these include every element of the new requirement.

 

Amendment to Agency Workers Rules Regarding Pay

 

The Agency Worker Regulations 2010 (AWR 2010) entitles agency workers to receive the same pay and basic working conditions as direct employees once they have completed 12 weeks’ continuous service working in the same role. The ‘Swedish derogation’ currently provides an exemption to the right to equal pay, if agency workers are employed under a permanent contract of employment with the temporary work agency and are paid by the agency for periods between assignments.

 

From 6 April 2020, the Swedish derogation is removed. Once agency workers have satisfied the 12-week qualifying period, they will be entitled to equal pay to workers who are engaged directly by the employer. In addition, from 6 April 2020 all agency work-seekers must be provided with a key facts statement setting out the terms under which they will undertake the work.

Changes to IR35 Rules for the Private Sector

 

At present, the IR35 rules apply where an individual (worker) personally performs services for another person (client), through an intermediary (usually a personal service company, or PSC), and if the services were provided under a direct contract, the worker would be regarded for tax purposes as being employed by the client. Currently, it is the intermediary’s responsibility to determine whether IR35 applies.

 

From 6 April 2020, changes to IR35 rules will be implemented for medium and large businesses in the private sector and will largely mirror changes that took effect in the public sector in 2017.

 

Under the new regime, for all contracts entered into, or payments made on or after 6 April 2020, the onus will shift from the PSC to the end user client to make a status determination. Responsibility for accounting for tax and national insurance will shift to the party who pays for the individual’s services, known as the ‘fee-payer’.

 

In anticipation of these changes, it is essential that medium and large businesses carry out an assessment to determine whether the new rules under IR35 apply to their independent contractors and review their contracts and pay arrangements. Small businesses will not be caught by the changes.

 

Holiday Pay Reference Period Adjustment

 

The calculation of holiday pay can be complicated, particularly for those with variable hours and variable rates of remuneration. Currently, the holiday pay reference period is 12 weeks.

 

From 6 April 2020, the holiday pay reference period will increase from 12 weeks to 52 weeks. Employers will be required to look back at the previous 52 weeks where a worker has worked and received pay, discarding any weeks not worked or where no pay was received, to calculate the average weekly pay.

 

This change is expected to balance out the variation in pay for workers, particularly those in seasonal or atypical roles.

   

For more information about the changes coming into place this April, or for help with any other HR / Employment Law matters, please get in touch with our expert Employment Law Team on 01256 844888 or email enquiries@lambbrooks.com

   

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The contents of this article are for the purposes of general awareness only. They do not purport to constitute legal or professional advice.  The law may have changed since this article was published.   Readers should not act on the basis of the information included and should take appropriate professional advice upon their own particular circumstances.