It is safe to say that the past five years have been characterised by employment law inertia. But as we head towards the end of 2023, we are evolving into a period of significant legislative activity that will take us into 2024.
Changes to the Working Time Regulations
On 1 January 2024, the Retained EU Law (Revocation and Reform) Act comes into force, making changes to the interpretation of all EU-derived legislation. Alongside this are several draft regulations that attempt to reproduce important elements of EU law that would otherwise have been lost.
This includes various changes to the Working Time Regulations regarding holiday pay:
- The calculation of holiday pay for at least four weeks’ leave must now include commission and regular overtime.
- Workers can carry over all their statutory holiday entitlement where they have been unable to take it because of family-related leave.
- Workers can carry over up to four weeks for a maximum of 18 months where they have been unable to take holiday as a result of sickness.
- Workers can carry over up to four weeks indefinitely where the employer fails to recognise they are entitled to paid holiday under the regulations, fails to give them reasonable opportunity to take holiday or fails to inform workers that any leave not taken in that year will be lost.
The government has also taken the opportunity to allow employers to roll up holiday pay for part-year and irregular hours workers. They will accrue holiday entitlement at 12.07 per cent of the number of hours they have worked, subject to a maximum of 28 days.
Employers will no longer need to keep daily records of working hours for Working Time Regulations purposes, but details of hours worked are still required for minimum wage compliance and could be needed to defend future claims.
Although the intention of the new regulations is to simplify holiday rights, they have the potential to cause as many problems as they solve. For example, there is no definition of ‘regular overtime’ in the calculation of holiday pay, so you can expect litigation on just how ‘regular’ overtime has to be before it is included.
While that litigation finds its way through the tribunal system, employers may need to make some difficult calls on this until there is a precedent to follow.
Changes have also been made to the TUPE Regulations to allow individual rather than collective consultation in small businesses of fewer than 50 employees, or where the transfer involves fewer than 10 employees, irrespective of the size of the business as a whole.
This will simplify smaller-scale TUPE transfers where there is no union involved. Businesses no longer have to elect employee representatives with whom to consult in these circumstances and can instead hold individual meetings with employees.
Flexible Working Act
The Employment Relations (Flexible Working) Act passed over the summer. While it doesn’t make flexible working a ‘day one right’, despite being promised by government, it does allow up to two flexible working requests per year. It also requires you to consult with employees before refusing a request and all requests should be considered within two months.
So, after years of waiting, it is positive to see a move away from employment law inertia. But with change comes the potential for litigation, and HR professionals can expect to see more of this in 2024, as they make some challenging calls during what is likely to be a period of uncertainty.
Louise Taft is a consultant solicitor at Jurit