There have been some significant movements in employment law during 2018, with the introduction of the General Data Protection Regulation (GDPR) on the 25th May, as well as the first cut-off dates for reports about the gender pay gaps. So how is 2019 expected to pan out for employment law?
Planned Legislative Initiatives for 2019
January starts off with two important deadlines that both come to a close on the 11th of the month. The government consultation on compulsory pay gap referring to ethnicity comes to a close.
Additionally, another important government consultation closes on the 11th of January – that about the tribunal system. Last September, a consultation was launched to create a dialogue on how to improve the existing procedure on the handling of employment law cases. This consultation was created to discuss a number of areas.
One of the topics in discussion is whether to increase the time window allowed for employment law claims. Currently the limit is 3 months minus one day for the major part of cases, and the discussion is whether to increase this time window to six months.
Another topic under discussion is whether to remove the limit of £25,000 on claims for breach of contract and also whether a tribunal can be allowed to hear such claims even while an employee is still in employment.
Once the consultation closes on the 11th January, the Law Commission will then review the feedback received and based on the responses received, is expected to make its final proposals later on in the year.
If these two suggested initiatives are incorporated into employment law, the number of claims made is likely to increase and this is obviously a cause of concern for employers.
The long-discussed Brexit Day arrives on the 29th March. Although widespread changes to employment are not expected to be on the cards, certain laws that are unpopular to businesses, such as the Agency Worker Regulations and TUPE, may be subject to re-examination.
From the 1st of April, there will be an increase in the statutory rates set down in the National Living Wage from £7.83 to £8.21.
After the first mandatory reports about the gender pay gaps in 2018, on the 4th of April employers with more than 250 employees will be required to make their second declaration publishing data on the pay gap. This comparative information will be definitely be of interest as it will create a visibility on whether there was any movement in the reported gender pay gaps.
From the 6th of April, there will also be some changes in details included in payslips. To date, employers must furnish each employee and worker with a payslip, but from this date the payslip must also include the number of hours that the employee has worked if the income paid changes based on the number of hours that the employee has worked.
Also from this date of the 6th of April, the taxation on payments made on termination of employment will be simplified. Payments issued in lieu of notice since 6th April 2018 were considered as part of the salary, and subject to income tax and class 1 National Insurance Contributions. From 6th April of this year, class 1A National Insurance Contributions (being the employer’s obligation) and not only income tax, must be paid on all settlements made on terminations above the threshold of £30,000. This will bring employer National Insurance Contributions and tax into line but will also create added costs for terminations for employers.
Other topics are expected to arise during this year:
Following the government consultation on employment status that came to a close last June, the feedback from government about this is still pending and we expect a response from government to be issued throughout 2019. Additionally, a number of judgements on cases pertaining to employment status are also expected during 2019.
Another topic that may raise its head during 2019 is the possible reintroduction of tribunal fees. In 2017 the Supreme Court was very critical of the fees that were introduced by government for the employment tribunal in 2013, saying that these fees were not legal. There have been indications made by the Ministry of Justice that fees for claims for the employment tribunal may be reintroduced. The challenge here is to ensure that justice remains accessible while ensuring that the court system is sufficiently funded, and this is the Ministry’s major preoccupation.
In the coming months we will keep you informed of any new movements in employment law that may unfold but you are invited to contact us if you have any queries about the above topics or other areas of employment law.