Our monthly employment law update brings you the latest top picks of employment law developments that may affect your business.

Remember though, we’re always here to answer any questions you have and to help you navigate the wonderous world of employment law in managing your people!

This month we cover:

1. Post Brexit Reform of UK employment law.

2. Real Living Wage Increase.

3. Hybrid & Distance Working Tax Review.

4. Small Business Reporting Threshold increased.

5. IR35 accountability removed from employers.

6. Recent case law with takeaways for your business: Original grievance report, prior to legally advised amendments ordered to be disclosed.

7. Reminder on Right-to-Work checks with useful links.

1. Post Brexit Reform of UK Employment Law

We’ve all been waiting to see what will happen with the post-Brexit reform of UK employment law given that we have much EU law entrenched within UK employment law. The government announcement and the recently published bill ‘The Retained EU Law (Revocation and Reform) Bill 2022-23’, suggests that amending the EU-derived laws that were kept as part of the Brexit arrangements will now be easier to amend, replace or remove. The bill is effective from the end of 2023 with a transition period to sometime in 2026. At this point any EU employment laws will be removed unless they are written into new legislation, including the:

* Working Time Regulations

* Agency Workers Regulations

* Fixed Term Employees Regulations

* Part Time Worker Regulations

* TUPE Regulations

So potentially some big changes to come.

2. Real Living Wage Increase

As a result of the rise in living costs, there is going to be a significant increase in the Real Living Wage.

Not all employers choose to pay the Real Living Wage as it’s voluntary but there are around 11,000 who do.

The new rates are £11.95 an hour in London and £10.90 an hour across the rest of the UK.

The Living Foundation is asking for this to be paid asap where possible but by May 2023 at the latest.

3. Hybrid & Distance Working Tax Review

There is a review taking place (by the Office of Tax Simplification) as to whether the current tax rules are fit for purpose with the ever more popular new ways of working such as hybrid working and working from home. They’ll be looking at the following trends:

* Hybrid and home working.

* Impact of new ways of working on the self-employed.

* Employees of UK businesses working abroad.

* Employees of overseas businesses working in the UK.

The OTS are looking to engage with employers, employees and the self-employed to gather information on trends a to how these areas are being handled by 28^th October (recently brought forward from 25^th November)

For further information click HERE.

4. Small Business Reporting Threshold

More small businesses will now fall under the category of ‘small business’ in relation to various future regulations. The small business reporting threshold has been increased from 250 employees to 500 employees meaning that even more employers will now be exempt from future reporting requirements and other regulations. The government is considering increasing the threshold further to 1000 employees but will consult first.

Changes to current reporting requirements and regulations may also be made following the implementation of the Retained EU Law Bill mentioned earlier.

5. IR35 accountability removed from employers

No doubt many of you will have been pleased to hear during the mini-budget on 23rd September that the reform to the IR35 tax regime which happened in 2017 and extended in 2021 for private businesses, is now being removed. After all that I hear you cry – or is that just me!

From 6th April 2023, employers will no longer be accountable for determining the employment status of a Contractor and therefore whether they should be taxed as an employee and then for deducting the appropriate tax & NI. The responsibility passes back to the Contractor as before.

6. Case Law with Implications

6.a. Original grievance report, prior to legally advised amendments ordered to be disclosed.

The employer (University of Dundee) investigated a grievance complaint and produced a report for the grievance. They then passed it to an external legal advisor who suggested changes to the report. The report was amended upon that advice and was then issued to the employee (Chakraborty).

Chakraborty requested the original version of the report from the employer but that was denied because they said it was protected by legal privilege.

When the case later wound up in the tribunal, the court ordered that the original report before the amendments were made must be disclosed to both the claimant and the tribunal, not just the final version of the report.

Takeaways – What does this mean for employers?

This case shows the importance for employers of getting legal advice at the right time and making sure they are guided through the grievance processes from the start by a qualified HR &/or Employment expert.

7. Reminders

Remember, you should now be conducting in-person right-to-work checks or using the Home Office’s online right-to-work check system, or conducting a right-to-work check using a certified identity service provider depending upon what right-to-work documents the employee provides you with.

Disclaimer

The intention of this update is to give general information only and isn’t intended to be an exhaustive statement of the law. Although we’ve taken care over the information, you should not rely on it as legal advice. We do not accept any liability to anyone who does rely on its content.