Employment Law Update – June 2024

Tuesday 28th May 2024

As we approach the halfway mark in the year, we would like to remind you of the employment law changes introduced this year.  The regulations were given a long-winded name: Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023.  To make it easy for everyone, these regulations are commonly referred to as the Employment Rights Regs 2023 (or Regs 2023).  They came into force on 1 January 2024. The Regs 2023 are particularly relevant because many employers will shortly be considering distributing bonuses, commissions, and tips; and employees will be lodging requests for summer holidays. 

A summary is produced below:

Holiday Pay and Entitlement under the Working Time Regulations 1998 (‘WTR’) – effective as from 1 April 2024

Calculation of holiday entitlement – started 1 April 2024

Under the WTR, all workers are entitled to 5.6 weeks’ annual leave in each holiday year. Clarity is now provided to simplify calculating holiday entitlement for “part-year workers” and “irregular-hours workers”.  For these people, holiday entitlement will accrue at a rate of 12.07% (or a higher percentage if they are entitled to more than the statutory minimum) of the number of hours worked in each pay period.  

Part-year worker is defined as a worker who is required to work only part of that year.  Therefore, it means that there are periods of at least a week in that same year, which that worker is not required to work and for which they are not paid. Periods of sick leave or statutory leave (such as maternity leave) are excluded.

Irregular-hours worker is defined as a worker whose number of paid hours that they will work in each pay period during the term of their contract in that year, is wholly or mostly variable.

Note the following points:

  • Agency workers will be subject to the same criteria when calculating holiday entitlement.  This means that whether they qualify as a part-year or irregular-hours worker will depend on their contract.
  • Normal remuneration includes commission and regular overtime. 
  • Workers are permitted to carry over statutory holiday to the following year where they have been unable to take holiday due to family-related leave.
  • If a worker has been unable to take leave due to sickness, they will be allowed to carry over up to 4 weeks’ holiday for a maximum of 18 months.

Rolled-up holiday pay – effective as from 1 April 2024

Employers of part-year workers and irregular-hours workers can opt to pay them rolled-up holiday pay.  This is an uplift to normal pay, of 12.07% specifically for holiday pay.  This makes it simple for employers instead of them having to calculate and pay holiday pay at the time the worker takes holiday. Previously, rolled-up holiday pay was considered unlawful. 

Increased Flexibility in taking Paternity Leave – effective as from 6 April 2024

An eligible father or partner can take the leave in two blocks of one week each any time during the first year of birth or adoption. They need to give 28 days’ notice in advance of each period of leave.

Maintaining time records pursuant to the WTR – effective as from 6 April 2024

Employers simply need to keep records to show that they have complied with the WTR.  They do not need to keep records of all working and rest time anymore.

Increased protection against redundancy for pregnant employees – 6 April 2024

Employees taking most types of parental leave now have protection from redundancy for at least 18 months. This protection means that if their role is made redundant, their employer must give them first refusal of any other vacancies.  They can still be made redundant if no appropriate vacancy is available.  Protection begins on the day the employer is first notified of the employee’s pregnancy and ends 18 months after the date of the child’s birth.  Protection also extend to parents taking adoption leave – they are protected for 18 months after the date of adoption. 

Extended right to request flexible work – effective as from 6 April 2024

Employees are able to make a request to work flexibly with regard to part-time, term-time, flexitime, compressed hours, and varied working locations as from the first day of employment.  They can also make two requests to work flexibly in a 12-month period.

Employers must consult with employees about their request and reach a decision within two months.  Employers must provide reasons for rejecting a flexible working request.

New Right to Carers’ Leave – effective as from 6 April 2024

Employees with a dependant requiring long-term care have a right to ask for one week’s unpaid leave every 12 months to care for that dependant. This is a right from the first day of employment. Employees must give at least three days’ notice, or at least twice the amount of notice as the period of leave, if they want a period of leave longer than just one week.

Consultation requirements pursuant to the Transfer of Undertakings (Protections of Employment) Regulations 2006 (‘TUPE’) – to be effective as from 1 July 2024

There will be an option to consult directly with staff instead of having to elect employee representatives if the organisation:

  • Has fewer than 50 employees; or
  • Intends for fewer than 10 employees to transfer regardless of the size of the organisation.

Zero hours and agency workers – to be effective as from September 2024

Zero-hour/casual and agency workers will have a new statutory right to request a more predictable working pattern.

If a worker’s existing pattern lacks certainty in hours, or if they are on a fixed-term contract for less than 12 months, they will be able to make a formal application to request a change to their working pattern to one that is more predictable. An employer then has one month to make a decision and can refuse only if the reason for refusal satisfies a particular statutory ground (more information to follow in due course).

Duty to prevent sexual harassment of employees – to be effective as from October 2024

Employers will be under a duty to take reasonable steps to prevent the sexual harassment of their staff during employment. Tribunals will be able to increase compensation by up to 25% if an employer is found to have breached this duty.

Courtney Stephenson & Maria Fernandes