This month we are highlighting what to look out for in employment law in 2020.

In Northern Ireland:

1. Early conciliation started in Northern Ireland on 27 January 2020.  This means that for most types of employment claims, employees will be required to contact the LRA, and obtain an Early Conciliation Certificate, before they are allowed to lodge a claim in the Industrial/Fair Employment Tribunal.
2. From April 2020 there will be a duty on employers to categorise employment status.  Medium and large organisations (turnover in excess of £10.2 million) in all sectors of the economy will become responsible for assessing the employment status of individuals who work for them through their own limited company.    We often see situations where an individual prefers to work through a limited company as a self employed “consultant”.  However there is now an obligation firmly on the hirer/employer to decide whether that person is truly a self employed consultant responsible for their own tax affairs, or whether the person is in fact and employee or worker, for whom PAYE and Employers National Insurance should be paid.   The employer/hirer must provide reasons for its determination, and the determination must be given to the individual.    Until this is done, the hirer/employer is responsible for the individual’s PAYE and national insurance contributions.

3. Holiday pay has become a hot topic and we can expect many more claims in this regard (of course routed through the Labour Relations Agency Early Conciliation Service).   Legislation is needed to provide clarity on what employers are required to do, however we know from the decision of the Court of Appeal in Agnew v Chief Constable of PSNI, that:
   • the reference period for calculating normal remuneration may vary from between 12 and 52 weeks according to the particular circumstances;
   • the correct way to calculate holiday pay is by reference to working days and not calendar days. 

Our advice is to make sure that you are basing holiday pay on “normal remuneration” (that is, reflecting voluntary overtime etc,) for at least 4 weeks holiday entitlement.

4. As the Assembly is back up and running, we could see new employment legislation in NI.  Several parts of the Employment Act (Northern Ireland) 2016 have not yet been brought into force, and these could now be on the agenda.  We could see changes on:

• Gender pay gap reporting obligations – these have been in place in GB since 2017 but have not to date been required in NI.
• Zero hours contracts – a ban on exclusivity clauses in zero-hour contracts has been in place in GB since 2017 but they have not yet been banned in NI.  That could happen this year if enabling regulations are produced.

In Great Britain a number of changes are coming into force in April 2020:

1. Workers and employees will be entitled to a written statement of employment particulars on day 1 of work.  Previously a written statement of terms had to be provided to employees (not workers) within two months of starting work.

2.      Changes to itemised pay statements - Pay slips must include additional information for individuals whose pay varies depending on the number of hours that they have worked. The right to payslips is extended to all workers and not just employees. 

3. Parental Bereavement Leave will allow employed parents paid leave for a minimum of two weeks on the death of a child.  A statutory payment will apply which at this stage is £140.98 per week.

4. Changes to the Agency Worker Regulations – Currently the regulations contain a “Swedish derogation”.  Currently, if agency workers are directly employed by an agency under a Swedish derogation contract, they do not acquire the right to equal pay compared with the hirer’s employees after 12 weeks on assignment. The Swedish derogation is being abolished from April 2020.  Agency workers can still be directly employed by an agency, but they will be entitled to equal pay compared to the hirer’s employees after 12 weeks on assignment.

5.Change to Holiday Pay reference period for workers with irregular hours or on zero hour contracts.   Holiday pay will be calculated by reference to an average over 52 weeks of employment, or up to 104 weeks in some cases, rather than the current 12 week period.

6. Zero hours workers will have the right to require a more stable and predictable contract after six months service

There are 10 separate consultations on employment law matters taking place in GB, so there may be many more changes to come over the next 12 to 24 months.

Although employment law is a devolved matter in Northern Ireland, developments in GB are normally indicative of what will happen in NI employment law.

How will Brexit affect employment law?

A significant proportion of the UK’s employment laws have their basis in EU legislation.  The UK leaves Europe today, 31 January.  There is to be an 11 month transition period, until 31 December 2020.  During the transition period, although the UK will cease to be an EU member, the trading relationship will remain the same and it will continue to follow the EU’s rules, such as accepting rulings from the European Court of Justice.

This means that the UK employment law will still be interpreted in accordance with European law, at least until 31 December 2020.  After that date, parties to litigation may potentially seek to challenge the law arising from controversial ECJ judgments, such as those relating to the calculation of holiday pay. As the position becomes clearer, we will keep you informed.

If you would like to discuss any aspect of this article, please get in touch with us.