What businesses need to know about the Good Work Plan

4 Mar 2019 By Sarah Gill

Sarah Gill assesses what steps organisations need to take to prepare for the government’s forthcoming changes

Although billed as the ‘biggest package of workplace reforms for over 20 years’, the Good Work Plan – the government’s vision for the future of the labour market and the action it will take to implement the Taylor review recommendations – doesn’t read like that. While the prime minister has not only committed to maintaining workers’ rights when the UK leaves the EU but also to enhance them, it sets out little in the way of concrete steps to achieve this. 

What will change on 6 April 2020?

Statement of written terms 

Written statements of terms will need to be given on or before the first day of employment or engagement to only employees and workers. Statements of terms must also include:

  • Whether there is a probationary period

  • More detail around hours and days of work and whether variable

  • Details of other paid leave (in addition to holidays)

  • Any training entitlement

Goodbye to the Swedish derogation 

Swedish derogation contracts (otherwise known as ‘pay between assignments’ contract) for agency workers will become unlawful. Impacted employers will need to assess the cost implications and find ways to mitigate. 

Change to holiday pay reference periods

The reference period for determining a week’s pay for the purpose of calculating holiday pay will increase from 12 to 52 weeks. For employers of casual workers or staff on variable hours, this could increase costs.

What should employers look out for in future?

The right to request a more predictable and stable contract

The intention is that workers with 26 weeks’ service or more will be able to ask for greater certainty in terms of the hours they work. It will be a right of request, to be considered by the employer with no guarantee that it will be granted. The presumption is that it will work in the same way as flexible working requests. 

The time required to break a period of continuous service may increase from one week to four

For those who engage seasonal or casual workers, this change will be one to keep an eye on because in theory it will mean that workers could gain access to employment law rights more easily. 

Banning employers from making deductions from staff tips

For those in affected industries it will be worth checking that contracts and policies are reflective of the change when it occurs.

Further changes to holiday pay 

In addition, the government intends to:

  • Raise awareness of rights and aid understanding in calculating holiday pay

  • Introduce new guidance to interpret holiday pay rules (which can be complex)

  • Introduce an online holiday pay calculator.

Potential reintroduction of employment tribunal fees

While nothing explicit was said in the Good Work Plan, it is likely that the government will reintroduce employment tribunal fees. It is unlikely that fees will be at a similar level to the previous fee regime deemed unlawful by the Supreme Court. 

Changes to employment status

The future of employment status is the elephant in the room in the Good Work Plan. Employment tribunals and the courts have soldiered on in recent years, endeavouring to keep up with the impact of the gig economy on existing laws that were not designed for it. While the government plans to improve clarity on employment status, in the short term it has commissioned research to find out more about uncertain employment status and how it affects workers.

What is ‘good work’?

One final question raised is what exactly is ‘good work’? The Good Work Plan is billed as “the first time that the government has placed equal importance on both quantity and quality of work”. It has asked the independent Industrial Strategy Council to consider how to measure quality of work, which it considers is made up of the five principles: satisfaction; fair pay; participation and progression; wellbeing, safety and security; and voice and autonomy.

However, with Brexit looming and the stability of the economy in question, ‘good work’ may end up taking a back seat.

Sarah Gill is a senior associate at CMS

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