2nd June 2023

Employment law changes on the horizon

Three ‘family friendly’ Acts have received Royal Assent on 24 May 2023 and will be implemented in due course:

• The Neonatal Care (Leave and Pay) Act: will allow the right to take up to 12 weeks of paid leave to parents whose newborn baby is admitted to neonatal care (in addition to other rights such as maternity and paternity leave).
• The Protection from Redundancy (Pregnancy and Family Leave) Act: will extend existing redundancy protections to those on maternity, adoption or shared parental leave to cover a period of time after the parent has returned to work (in addition to protection during such leave).
• The Carer’s Leave Act: will allow the right to one week’s unpaid leave per year for employees caring for a dependant with a need for long-term care (such as long-term illness, disability or issues related to old age).
  Whilst these Acts are now on the statute books, further secondary legislation must be composed to detail how such rights will operate in practice.

In other news…

Post-Brexit, the Government was due to automatically revoke most EU-derived law by 31 December 2023. This is no longer the case.

On 10 May 2023, the Government announced that it will row back on the so-called ‘sunset clause’ contained in the Retained EU Law (Revocation and Reform) Bill, now meaning that all EU-derived law retained post-Brexit will remain binding in the UK unless and until expressly repealed. So rather than take a hammer to c.4,000 pieces of EU-derived legislation, the Government will instead take a scalpel to far fewer.

On the same day as this announcement, the Government also published its ‘Smarter regulation to grow the economy’ policy paper, setting out its plans (in part) in relation to certain aspects of employment practice, notably:

• Non-compete clauses: The Government intends to legislate (‘when parliamentary time allows’ – which, frankly, could mean ‘never’ or ‘subject to the outcome of the next general election’) to limit the length of non-compete clauses to three months. That may be unattractive for some employers seeking to guard against key members of staff joining a competitor or setting up a rival business for a longer period. However, this will not affect the use of other restrictions such as non-solicitation or confidentiality obligations, which remain effective tools for protecting business interests.
• Working Time Regulations: The Government is consulting on removing requirements on businesses to record and report the working hours for staff (whilst seeking to preserve protections for workers) as well as legalising rolled-up holiday pay (the practice of allocating holiday pay as part of a worker’s fee – a currently unlawful, but not uncommon, practice).
• Transfer of Undertakings (Protection of Employment) Regulations (TUPE): The aim of TUPE is to ensure affected employees’ terms and continuity of employment are preserved if there is a transfer of their employer’s business or service. Currently, businesses cannot consult employees directly where they do not already have employee representatives in place. Instead there is a requirement to arrange elections for new employee representatives. The Government is consulting on removing this requirement for businesses with fewer than 50 people and transfers affecting fewer than 10 employees, allowing businesses to consult directly with the affected employees.

From an employment perspective, the Government’s recent announcement in relation to its sunset clause will be seen as welcome news by many in removing some of the uncertainty around what would otherwise have been an overnight upheaval of most EU-derived law come the New Year. On the other hand, it does mean that some employment laws considered problematic for some businesses, such as TUPE and the Agency Worker Regulations, will remain in place in their current form, at least for the time-being.

What should employers do?

Presently, in terms of day-to-day employment practice, it will be business as usual but with the promise of certain changes on the horizon.

Get in touch with our Employment team if you have any questions at all.

Drop us a line…

James Baker Partner – Head of Employment (Email James)

Danielle Lobel-Weiss Partner (Email Danielle)

Martin Tynan Associate (Email Martin)

Neha Solanki Associate (Email Neha)