London,
30
January
2019
|
19:24
Europe/Amsterdam

2019 in employment law: the year at a glance

Although the business and news agenda for 2019 will inevitably be dominated by Brexit, there are several changes to employment law on the horizon which will have major practical implications for businesses. This includes a raft of measures coming into force in 2020 for which businesses will need to start preparing now.

   
January 2019

Executive pay reporting: New rules on reporting executive pay for UK-listed companies with an average of 250+ employees (including employees of subsidiaries for UK-listed parents) come into force. The rules apply to financial years starting after 1 January 2019 so the first reports will be due in early 2020, but data gathering will start in 2019.

Affected businesses will need to report annually on the difference in pay between their CEO and their 25th, 50th and 75th centile employees, expressed as a ratio. They will also need to provide an explanatory narrative in the directors' report.

The new UK Corporate Governance Code (applicable from January 2019) requires listed businesses to implement arrangements for workforce engagement. The options it recommends are:

  • a director appointed from the workforce;
  • a formal workforce advisory panel; or
  • a designated non-executive director.
March 2019 Brexit will take effect on 29 March 2019 unless Article 50 is withdrawn or extended before that date. It remains unclear whether this will be under the draft Withdrawal Agreement negotiated by the Prime Minister, a no-deal Brexit or some other arrangement.
April 2019

National living wage and national minimum wage rates will increase, as will the rates for statutory sick pay, statutory maternity pay and similar statutory payments.

The minimum contribution levels for pensions auto-enrolment will increase: the employee's contribution will increase from 2% to 3% and the minimum total contribution will increase from 5% to 8% of qualifying earnings.

4 April: the second round of private sector gender pay gap reports will be due.

6 April: changes to payslip requirements:

  • all workers will be entitled to itemised payslips; and
  • payslips will need to contain further details where pay varies according to the time worked - employers must specify the number of hours that are being paid for. The aim is to help employees identify underpayments.

6 April: The maximum penalty which can be awarded by Employment Tribunals for an "aggravated" breach of employment law will increase from £5,000 to £20,000.

December 2019 The Senior Managers and Certification Regime (SMCR) will be rolled out to all FCA-regulated financial services firms.
April 2020

This will be a busy month for HR practitioners, with several substantial changes coming into force, including:

  • changes under the Government's Good Work Plan;
  • changes to off-payroll working in the private sector;
  • changes to termination payments (all termination payments above the £30,000 threshold will be subject to class 1A NICs);
  • The Employment Rights (Employment Particulars and Paid Annual Leave) (Amendment) Regulations 2018 will come into force:
    • written statement of terms of employment must be given on or before the first day of employment, rather than within two months of starting employment
    • requiring additional information to be given in the written statement
    • increasing the reference period for determining an average week's pay (for the purposes of calculating holiday pay) from 12 weeks to 52 weeks, or the number of complete weeks for which the worker has been employed.
  • The Employment Rights (Miscellaneous Amendments) Regulations 2019 come into force:
    • extending the right to a written statement of terms to all workers
    • lowering the threshold required for a request to set up information and consultation arrangements.
  • The Agency Workers (Amendment) Regulations 2019 come into force, abolishing the Swedish Derogation (whereby agency workers are not entitled to equal pay with comparable permanent staff if they are paid between assignments).
  • Expected date for new right to bereaved parental leave and pay.

Upcoming cases of interest include the Supreme Court judgment in the long-running Uber worker status claims, a Court of Appeal decision on whether offering enhanced maternity pay but not enhanced shared parental pay is discriminatory and a Court of Appeal case on the scope of legal advice privilege in discrimination and victimisation cases. Watch this space for news on these interesting developments!

If you would like any additional information, please contact Head of Employment Jane Amphlett.