Preparing for the ‘biggest overhaul in employment law in 20 years’
Whilst the end of the calendar year can often prove busy from an operational perspective within many organisations spanning many sectors, for business owners and decision makers the period leading up to the financial year end is usually the most demanding.
There are many key choices to be made, including a review of the existing and new business projected, and the subsequent impact that this will have on infrastructure in every sense of the word.
From the need for new equipment, an upgrade to the IT systems, the downsizing, expansion or refitting of the office and, perhaps most importantly, the need to retain or recruit good workers – an often difficult and time-consuming task in any organisation.
And whilst not ideal, it is therefore quite easy to see why many businesses pour much of their effort and energy into finding the right candidate with the rights skills and the right attitude, before parking any associated actions relating to ‘onboarding’ said worker until they officially join the firm.
However, as we move towards the end of the 19/20 financial year and embark on yet another new decade, what was once considered to be just ‘not best-practice’ could end up landing employers in hot water; with major employment related legislative changes due to come into force in April.
Here, Banner Jones’ Head of Employment Law Katie Ash talks to us about what is commonly referred to as ‘the biggest overhaul in employment law for more than 20 years’ and what it means for you.
Amidst the political uncertainty of the last few years many business owners and senior decision makers can be forgiven for not being across – or even aware of – what the Government has dutifully named ‘The Good Work Plan’, and yet there are less than three months until it comes into force.
In a nutshell, it is intended to strengthen workers’ rights and to ensure fair and decent work is available to all including agency staff and temporary workers. Its three key considerations include: fair and decent work; clarity for employers and workers; and fairer enforcement.
Great straplines, certainly, but what does it actually mean for employers and their legal obligation to their staff?
Here are some of the key changes afoot.
Right to request a stable contract:
Whilst there is recognition within the legislation that many British businesses rely on casual labour and flexible contracts, there is a general consensus that the flexibility is not as favourable for the employee or worker as it is for the employer – a structure that is resulting in financial instability for many.
Amidst plans to ensure that workers can access fair and decent work, the Good Work Plan stipulates that any worker, operating under any guise (zero hours, temporary etc) has the right to request a more stable contract.
However, it’s important to note that this is a right to request, and not a requirement to grant. The most important thing is to have a robust process in place to review and respond to such applications and that the decision is fair and appropriate. Simply refuse and face the consequences.
Contracts and statement of rights
These changes are designed to ensure that there is greater transparency between the employer and the employee with regards the role, responsibilities and a worker’s rights.
The major legislative shift here is that every worker MUST receive a statement of their rights on appointment. This is intended largely for agency workers and will mean they are better informed with regards what they are signing up to.
As an employer, it means contracts must be delivered on day 1, and not a week or so down the line, so preparation is the key!
Employees should also receive their contracts at the start – if not in advance – of their first day of work, and every effort should be made to ensure that these are signed, returned and filed so that everyone is working from the same hymn sheet.
If for whatever reason that doesn’t happen, having a paper trail in place to demonstrate that the employee received and was prompted to return a signed copy will be key should anything go wrong further down the line and an employment tribunal becomes involved.
Employment status tests
This change is key in any business that employs ‘casual staff’.
Under the new legislation there will be an increased emphasis on businesses to correctly classify worker status. This is intended to ensure that workers have access to the right rights, so to speak – including pensions, holiday pay, maternity leave etc.
A failure to adhere will also come with increased penalties, with the maximum fine that can be imposed by a Tribunal rising to £20,000. So, it’s easy to see why it’s worth getting it right, right away.
These are just a few of the changes afoot, but whilst it is true that this new legislation brings with it many new, and improved, employment rights, it’s important to point out that it is not likely to be as overwhelming and all consuming as one might first think.
Many businesses will already adhere to the legal requirements simply by following best practice, and others will need to make just minor changes to bring themselves in line.
However, the Good Work Plan is really intended to encourage employers to do more than just the bare minimum.
Many businesses will want to embrace the changes afoot and be seen by their employees and workers alike as a good and fair place to work. To that end, it’s really the ideal opportunity for many to stop and take stock of their documentation and policies in place.
If anything does need reviewing or updating, there is still plenty of time to seek advice and action accordingly.