Changes to employment law from April 2020
April brings with it the usual annual increases to the redundancy pay, national minimum wage and statutory pay for family-friendly leave and sickness absence. But the effects of Good Work: the Taylor review of modern working practices, published in 2017, are still being felt and changes are being introduced to protect vulnerable workers in increasingly flexible business models.
Significant changes to IR35 tax rules are taking effect along with the introduction of the right to parental bereavement leave. A raft of measures designed to protect vulnerable workers also come into force; and don’t forget Brexit.
From 1 April 2020
Increase in the national living wage for workers aged 25 and over from £8.21 to £8.72 per hour.
Increase in the national minimum wage for workers aged at least 21 but under 25 from £7.70 to £8.20 per hour.
Increase in the national minimum wage for workers aged 18 but under 21 from £6.15 to £6.45 per hour.
Increase in the national minimum wage for workers aged 16 or 17 from £4.35 to £4.55 per hour.
Increase in the apprentice rate from £3.90 to £4.15 per hour.
Increase in the accommodation offset from £7.55 to £8.20 per day.
From 5 April 2020
Increase in the rate of statutory maternity, paternity, adoption and shared parental pay from £148.68 to £151.20 per week.
From 6 April 2020
Increase in statutory sick pay from £94.25 to £95.85 per week.
Weekly pay / statutory redundancy pay increased from £525 to £538.
Unfair dismissal compensation cap increased from £86,444 to £88,519.
Bereavement leave
From 6 April 2020, bereaved parents will be entitled to two weeks’ leave if their child dies or is stillborn and leave will be paid if the parent meets certain criteria.
Statements of particulars
The Employment Rights Act 1996 lists the information that must be given to an employee in a ‘statement of particulars’ and this will have to be provided to workers as well as employees. Casual workers and individuals on zero hours contracts are likely to be categorised as workers and will benefit from this right. Determining worker status is a thorny issue in employment law. As a rule of thumb, workers do not have to accept offers of work unlike an employee. However, they do have to perform the work themselves, rather than send a substitute, which distinguishes them from a self-employed contractor.
The statement of particulars must be provided before or on the first day of work, although some information, such as relating to pensions and training, can follow within two months. Your standard statement of particulars or contract or employment may need updating to include additional information, required by changes to the Employment Rights Act 1996, such as the entitlement to training and other benefits.
These changes apply to staff joining on or after 6 April 2020 but watch out for triggers that entitle other staff to a new style statement of particulars. This could be an individual asking for a statement or making certain changes to terms and conditions.
Calculating holiday pay
To take account of peaks and troughs in work for casual staff and seasonal workers, the way in which holiday pay is calculated will change. Holiday pay for those working irregular hours will be calculated using average earnings over the previous 52 weeks. Before 6 April 2020, the average was calculated over 12 weeks.
Brexit
Finally, a brief word on Brexit. The UK is now in the transition period, which runs until 31 December 2020. During the transition period, free movement of workers continues and EEA workers can still work in the UK. Employers should be reminding their employees from EEA countries to apply under the settlement scheme for settled or pre-settled status. The deadline for applications is 30 June 2021.
It is business as usual for employment law until the end of the transition period on 31 December 2020. EU law determines many areas of UK employment law. We will keep a close eye on this year’s trade deal negotiations and the likely impact on the future development of employment law.
We can advise you on how best to prepare for these changes, including updating contracts of employment and assessing the status of your contractors. Please contact us if you wish to discuss.
This article is for general information only and does not constitute legal or professional advice. Please note that the law may have changed since this article was published.