Navigating employment law changes in 2024
Welcome to our breakdown of the significant employment law changes coming into effect in 2024. As businesses brace for new and updated regulations, it’s essential to equip yourself with the knowledge and foresight necessary to navigate these changes effectively.
Antonia Brewer and Thomas Corcoran summarise the key points to help employers understand what actions are needed to ensure compliance and maintain a competitive edge in today’s dynamic business environment.
Working Time Regulations
As of 1 January 2024 the Government removed the obligation on employers to keep a record of employees’ daily working hours to ensure compliance with the 48-hour working week. Employers still need to keep “adequate” records of employees’ working hours.
TUPE changes
Under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE), the requirement to elect employee representatives will be removed for businesses with fewer than 50 employees and for transfers affecting fewer than 10 employees (regardless of the size of the employer), where no existing employee representatives are already in place. Employers must currently elect employee representatives for consultation, except for businesses with fewer than 10 employees. Instead, employers in such circumstances will be able to consult directly with employees. These new rules will apply to transfers taking place on or after 1 July 2024. Employers should keep an eye out for any further changes to TUPE in the future (e.g. clarification on the application of TUPE to “workers”).
Holiday pay
The Government has introduced an accrual method to calculate annual leave entitlement for irregular hours workers and part-year workers, which will apply in respect of leave years starting on or after 1 April 2024. Such workers will now accrue annual leave entitlement on the last day of each pay period at the rate of 12.07% of the number of hours that they have worked during that pay period, subject to a maximum of 28 days per year. (This method was widely used before the Harpur Trust judgement in 2022).
For the same atypical workers, employers will now have the option to operate “rolled-up holiday pay”, allowing irregular hour workers and part-year workers to be paid holiday pay based on 12.07% of all their earnings (including overtime and other pay allowances) within that pay period. These changes will be welcomed by most employers as allowing a more simplified approach to the calculation of leave/pay for these workers. Employers should review their approach in such circumstances, given that holiday pay can be a complex area of law.
Worker Protection (Amendment of Equality Act 2010) Act 2023
The Worker Protection (Amendment of Equality Act 2010) Act 2023 will come into force in October 2024. Employers will find themselves under a statutory duty to take “reasonable steps” to prevent sexual harassment of employees in the workplace. If an employer is found to have breached the duty, an employment tribunal may order the respondent to pay an uplift of up to 25% of the total compensation awarded. The Equality and Human Rights Commission will also produce a statutory code of practice to provide guidance to employers to help them meet their obligations under the new duty. Employers should review their anti-harassment policies, update employee training and consider creating or updating a central reporting register for complaints.
Non-compete clauses
Non-compete clauses are proposed to be limited to a statutory limit of 3 months. However, the Government has not yet made the timeframe clear or introduced draft legislation, and so the detail of these change remains unclear. The change is widely assumed not to take effect until after the General Election. Employers should watch out for developments in this area (including how any legislation treats non-compete clauses in existing contracts where these exceed the proposed cap). Read our recent blog for further insights this.
The Neonatal Care (Leave and Pay) Act 2023
The Neonatal Care (Leave and Pay) Act 2023 will allow parents of babies who are admitted into hospital aged 28 days or less a day one right to up to 12 weeks’ leave if the baby is in hospital for a continuous period of 7 days or more. Statutory neonatal pay will be paid where the employee meets the service requirement (26 weeks’ service) and the minimum earnings criteria. The anticipated commencement date for this is April 2025, with “implementing regulations” still awaited. Employers should take steps to review/introduce policies relating to neonatal leave, ensure existing policies are updated to comply with the new statutory regime and consider training HR staff.
The Carer’s Leave Act 2023
The Carer’s Leave Act 2023 will bring a day-one entitlement of one week’s unpaid leave per year to employees who have a dependant with a “long term care need” (e.g. an individual with a disability or an elderly individual). The leave can be for any type of care and there is no restriction on how the leave is used, but the usual qualifying criteria for dependants will apply. The regulations provide details on the requirements of leave requests, including the patterns in which leave may be taken, notice requirements and employers’ ability to postpone (though not reject) the leave. The changes will come into force on 6 April 2024. Employers should take steps to review/introduce policies relating to carer’s leave, ensure existing policies are updated to comply with the new regulations and consider training HR staff.
Flexible working
Various changes under the Employment Relations (Flexible Working) Act 2023 and Flexible Working (Amendment) Regulations 2023 will come into force on 6 April 2024. These include employees gaining a day-one right to submit a flexible working request (removing the current 26-week service requirement). Employees will also be able to submit two requests each year (currently one a year) and the employer will need to provide a response within two months instead of three. An employer will also be expected to consult with an employee before rejecting a flexible working request. ACAS is currently updating its statutory Code of Practice and the final version, which will provide guidance for employers (including on the consultation requirement), will be published later this year. Employers should prepare for an uptake in the number of requests and update their practices in this area.
Workers (Predictable Terms and Conditions) Act 2023
Under the Workers (Predictable Terms and Conditions) Act 2023, workers and agency workers with a minimum service requirement (expected to be 26 weeks) will have the right to request more predictable terms and conditions of work where there is a lack of predictability to their work pattern. Workers will be able to make two applications in a 12-month period and employers will be able to reject the applications on specified statutory grounds. The changes are expected to come into force in Autumn 2024 and ACAS has published a draft Code of Practice on handling such requests. Employers affected by these changes will need to train managers and draft policies in preparation.
Protection from Redundancy (Pregnancy and Family Leave) Act 2023
Under the Protection from Redundancy (Pregnancy and Family Leave) Act 2023 the current right to be offered suitable alternative vacancies in a redundancy situation that applies to employees on maternity leave, shared parental leave or adoption leave will be extended so that the requirements can also apply during pregnancy and for a period of time after the end of the leave period. These periods vary according to the type of leave taken and the draft implementing regulations, if passed, will come into force on 6 April 2024. This potentially represents a significant increase in the number of protected employees and there are serious consequences for non-compliance (e.g. automatic unfair dismissal claims). Read our recent blog for further insights this.
Paternity leave
Under changes which will come into force on 8 March 2024 and will apply to children whose expected week of birth begins after 6 April, eligible fathers or partners will be able to split their leave into two 1-week blocks, rather than taking it in one go. Fathers and partners will be able to take leave at any time during the first year, rather than only the first eight weeks after birth or placement for adoption. The necessary notice for each period of leave has been reduced from 15 weeks before the expected week of childbirth to four weeks. Employers need to ensure they update their policies and practices once the changes are in force.
Employment Allocation of Tips Act 2023
For anyone in the hospitality sector, watch out for the Employment Allocation of Tips Act 2023, anticipated to come into force in July 2024. This will make it illegal for companies in the UK to take a portion of the service charge or tips from their staff who are employed on PAYE by restaurants or hotels. It will allow employees the right to challenge any decision made by their employer on the allocation of tips and ensure that tips are not used to make up the minimum wage. The Government is currently consulting on a draft statutory Code of Practice to support the measures (closing 22 February 2024), with a final Code of Practice expected in Spring. Hospitality employers will need to stay alert for details of the implementation date and the release of the Code to allow them to make the necessary changes in time.
As you gear up to confront these challenges head-on, it’s crucial to remain vigilant about the political landscape too. With the potential for significant shifts, such as new policies under a Labour government, like day-one rights for unfair dismissal, a new two-part employment status and changes to trade union rights, staying proactive and informed is more important than ever.
Whether it’s navigating new regulations, understanding emerging trends, or addressing legal challenges, our employment law team will provide invaluable advice tailored to your organisation’s needs.
For advice on how these new regulations might impact your business, contact our team on 020 7377 2829 or email [email protected].
