Summary of changes to UK employment law

Employers have used ‘fire and re-hire’ to force through a change to an employee’s contract of employment.

The practice came to the public’s attention in 2022 when P&O ferries terminated 786 crew members, only to replace them with employees on inferior terms of employment. At the time a Reddit public poll found that 75% of respondents wanted the practice banned. Responding to public opinion the government promised a code of practice that tribunals would consider when reviewing relevant cases.

The final version of the Code of Practice on Dismissal & Re-engagement has recently been published and is due to go live this summer.

The underlying theme of the code is that dismissal and re-engagement should be a last resort when an employer is seeking to introduce changes to employment terms.

Key points covered by the code.

• Information should be provided to relevant parties (trade union, employee representatives, employees) as ‘early as reasonably possible’ to enable ‘meaningful’ consultation, to explore options and seek solutions.
• There is no minimum period for the consultation and consultation is required, regardless of the number of employees affected.
• The consultation must be operated in addition to any other consultation requirements required by law (such as collective redundancy consultation).
• Dismissal and re-engagement is still a possible outcome for the employer following consultation. However, the code seeks to deter employers from using dismissal as a leverage for negotiation.
• Employers are required to contact ACAS before raising the prospect of dismissal and re-engagement if they are unable to reach an agreement.

There are no direct penalties for not following the code. However, a failure to do so would be admissible in evidence in a court or employment tribunal. It is open to a tribunal to uplift an award by 25% where it is found that the employer has unreasonably failed to comply with the Code or apply a 25% deduction where it is felt the employee has unreasonably failed to comply.

The code is undoubtedly a positive step forward; however, it will require careful application by employers to ensure that the issue of dismissal is not raised ‘unreasonably early’ and there is enough evidence on file that demonstrates that it was only contemplated as a ‘last resort’. It’s worth noting that should Labour win the next election their stance is to end the practice of fire and rehire in its entirety.

In its push to reduce net migration the government has made some significant changes to the UK’s Immigration Rules. Summary of the 2024 changes to be aware of, and when they came into force.

1 January 2024: Student Visa rules revised so that in most cases a student will not have the right to be accompanied by a dependent

The new rules apply to students who applied after 15:00 on 17 July 2023, for a course of study commencing on or after 1 January 2024. Exceptions are applied to full time students on a PhD or doctorate degree course or research-based degree courses lasting nine months or longer, or are government sponsored.

31 January 2024: Visitor visa categories: permitted activities widened

The list of permitted activities for a business visitor has been widened to include intra-corporate activities, remote working, research and legal services. Intra-corporate activities relate to individuals who are employed abroad will be able to enter the UK to visit a group business and undertake any of the following activities, without the need for a work visa.

• Advising and consulting.
• Troubleshooting.
• Providing training.
• Sharing skills and knowledge.

However, there are conditions attached. the activities must be incidental to those usually performed by the employee abroad and must also be undertaken to deliver a project or service on behalf of the UK business, rather than the business abroad.

With regards to the remote working category, this should not be confused with the digital nomad visa arrangements in other countries. The visitor will be able undertake activities related to their employment. However, this cannot be the primary purpose of their visit and they cannot be employed in the UK or receive payment from a UK source for their activities. The guidelines accompanying the change place emphasis on the length of stay when determining the genuine nature of remote working. Anything more than one month will attract increased scrutiny.

1 February 2024: Electronic Travel Authorisation (ETA) open for nationals of Bahrain, Kuwait, Oman, UAE, Saudi Arabia and Jordan

6 February 2024: Immigration Health Surcharge (IHS) to increase by 66%

The IHS allows visa holders access to the NHS in return for an initial upfront charge. There is no option to opt out (even if the individual will not use the NHS). For most visa types, the HIS is increasing from £624 per year to £1035 per year.

13 February 2024: Fines for illegal working to triple

The current maximum fine for employing an illegal worker is £15,000, which will increase to £45,000 (repeat offenders will be charged £60,000 up from £20,000).

28 February 2024: Updates to Right to Work Checks

Since 1 October 2022, Right to Work Checks must be carried out in one of the following three ways:

1. A manual in-person check – this can be applied to all nationalities and the employer must inspect the physical original document and certify the inspection has taken place.
2. Using IDVT provided by an IDSP – only available for British and Irish nationals.
3. Home Office online checking service – only for non-British/Irish nationals using the gov.uk website page.

The latest updates provide the following.

• Checks performed via video calls during COVID-19 (a relaxation applied from 30 March 2020 to 30 Sept 2022), do not have to be retaken and will provide an employer with a statutory excuse against liability for a civil penalty.
• EU Settlement Scheme clarity. It was previously the case that an employer could signpost an employee to make an application under the scheme, provided they could show reasonable grounds for making a later application. Employers can no longer do this and must take appropriate action against an EU citizen who is not registered (contact Home Office and take steps to terminate).
• A statutory excuse to civil liability will not be available to employers who have used IDSP providers for checks, other than on British and Irish passport holders.
• Under current law, employees sponsored for work by Employer A are permitted to undertake ‘supplementary work’ of up to 20 hours per week for Employer B, subject to meeting conditions. Under the latest guidelines, Employer B will be responsible for taking steps to guarantee that these conditions are satisfied in addition to performing a Right to Work check.
• Online right to work checks will be available to verify individuals who have an outstanding in-time application (i.e. application was made on time and before expiry of existing permission). Currently employers must contact the Home Office to check.

11 March 2024: Care Workers and Senior Care Workers will no longer be permitted to bring dependents to the UK

Only care homes that are regulated by the Care Quality Commission (CQC) will be able to sponsor migrants under the Health & Care Worker route.

Existing visa holders will be able to remain with their dependents and this includes extensions and changes of employer.

Care providers that have sponsored workers in circumstances where CQC was not required will be able to continue to sponsor the workers.

14 March 2024: Replacement of Shortage Occupation List with a new Immigration Salary List

The list will remove the current 20% salary reduction for shortage occupations, and it is anticipated that the number of shortage occupations on the list will be significantly reduced.

4 April 2024: The general minimum salary threshold for a Skilled Worker visa will rise to £38,700 per year from the current £26,200

It should be noted that, for many occupations there are already ‘going rate’ salary requirements that are more than the general threshold. These ‘going rates’ are also set to rise. Currently they are benchmarked against the 25th percentile for a particular role and will now be assessed against the 50th percentile. The existing exemption applied to health and social care workers and the education sector will continue to apply and therefore will not be required to meet the £38,700 salary threshold.

‘New Entrant’ salary reductions will continue to be applied in certain cases reducing the salary required to the higher of £30,960 or 70% of the going rate for the role.

6 April 2024: Removal of the requirement to renew Sponsorship Licences

Currently a licence is only valid for four years at which point it must be renewed. All licences due to expire on or after 6 April, will be automatically extended to expire in 10 years.

11 April 2024: Minimum income requirement for spouse and partner visas increases from £18,600 to £29,000 per year

Employers should take note of the above changes for potential future applicants and, in light of the increased fines for illegal working, also ensure that appropriate Right to Work checks are being performed prior to employing new starters.

We have covered the April 2024 changes to family friendly legislation in our previous updates however, given their potential impact on current workplace policies it’s worth summarising again.

Flexible Working Requests a ‘day one’ right and increased from one to two requests in a 12-month period

Additionally, the current requirement for an employee to explain the impact of their proposed working arrangements will be removed, and there will be a new requirement for employers to fully consult with an employee prior to turning down their request, and the deadline for a decision is reduced to two months from the current three months.

Paternity leave can be taken as two non-consecutive blocks

Currently an employee must take the leave as a continuous period of either two weeks or just one week and, if they take just one week then they remove their right to the other week of leave. Also from 6 April, the leave can be taken at any time within the first year of birth/adoption, rather than within the first eight weeks, and will require a shorter 28-day notice period.

Entitlement to one week of unpaid carer’s leave in a 12-month period

Currently employees have a right to reasonable unpaid time off to care for a dependent in emergency or unexpected circumstances. A new Carer’s Leave will be offered to employees from the first day of employment, which will allow for a one-week period of unpaid leave in any 12-month period. It is designed to help employees make more permanent arrangements for long-term care for a dependent.

New redundancy protection for pregnant women and parents

It is anticipated that from April 2024, employees that are either pregnant or parents within 18 months of the birth/adoption placement, will have a priority right to be offered suitable alternative roles within an organisation if their role is removed because of redundancy.

The following increases to statutory rates came into force on 6 April 2024.

The National Minimum Wage and National Living Wage will increase significantly from 1 April 2024.

For the first time the National Minimum Wage/National Living Wage will be available to employees who carry out domestic work while living with their employer.

The Employment (Allocation of Tips) Act 2023 comes into force on 1 July 2024. We covered its provisions in an earlier article, but as a refresh here is a brief summary of the features.

• No deductions from qualifying tips permitted (other than those authorised by law).
• Allocate qualifying tips in a fair and transparent way.
• Allocate to employees at the location where they were received.
• Have a written policy.
• Maintain records for three years.
• Pay to employees within one month following the month the tip was received.
• Also applies to agency workers.

Employers will need to review their current practices to identify areas of non-compliance and implement changes in advance of 1 July 2024.

On 22 February 2024, the Equality and Human Rights Commission (EHRC) published its menopause in the workplace guidance.

The guidance is supported by research published by the Fawcett Society and the CIPD, which reveal 1 in 10 women leave their employment as a result of symptoms caused by the menopause and, 67% of women reported that their symptoms had a negative impact on their work. The research supported the view that women have not felt comfortable requesting workplace adjustments and that guidance and steerage was required facilitate positive change.

The guidance highlights that employers already have a legal obligation under the Equality Act 2010 to protect woman who have menopause from unlawful discrimination.

The fact that menopause symptoms have a long term and substantial impact on a woman’s ability to carry out her daily or work activities, means they have the potential of being classed as a disability. An employer should therefore make reasonable workplace adjustments and ensure that they are not subject to direct or indirect discrimination.

A failure to appropriately manage menopause symptoms may also lead to direct and indirect discrimination claims as well as harassment and victimisation claims on the grounds of age and sex.

An employer also has a duty of care under health and safety laws to factor the condition into risk assessments and take appropriate action where risks are flagged.

In addition to explaining an employer’s legal responsibilities, the guidance sets out the main symptoms of the menopause and perimenopause and provides practical advice to employers on how to encourage a culture where employees feel able to talk about the condition and request adjustments, and how to have conversations with employees.

The guidance provides examples of the type of workplace adjustments that could potentially be adopted to help with the symptoms of menopause, such as changes to ventilation and temperature, relaxation of dress codes, providing rest areas, promoting flexible working, and recording menopause related absences separately.

The EHRC website includes three videos covering the above content.

We advise employers is to watch the videos and take a proactive stance to ensure the issue of menopause is positively addressed in the workplace.

This is another area that we have previously covered however, it’s worth summarising again just in case you missed it.

The Working Time Regulations were amended with effect from 1 January 2024, in order to clarify the position on entitlements post Brexit, and also address the Supreme Court ruling in Harper Trust v Brazel, in which a part year worker on a permanent contract was said to be entitled to the full 5.6 week entitlement that a full time worker would receive.

Summary of the revisions to the Act.

• Two pots of holiday entitlement to remain: Regulation 13 leave (four weeks derived from EU law and Regulation 13A leave (1.6 weeks derived from UK law).
• Holiday pay for Regulation 13 leave (four weeks) is calculated based on ‘normal’ rate of pay taking into account commission payments, regular overtime etc., averaged over the previous 52 weeks of work. The Reg 13A leave and any contractual holiday in addition to the statutory entitlement can be based on basic pay.
• Holiday pay for irregular hours and part year workers will be calculated as 12.07% of actual hours worked (effective for holiday years from 1 April 2024).
• Rolled up holiday pay can be applied to irregular and part year workers (previously outlawed by the European Court of Justice). Rolled up holiday pay is where the holiday accrual in a pay period is paid with the employee’s basic salary, rather than when they actually take their holiday. Effective for holiday years from 1 April 2024.
• Employees will be allowed to carry over unused holiday accrual at the end of a holiday year when they have been prevented from taking it because of other permitted absences (sick leave, maternity leave etc.). They will also be allowed to carry over holiday in circumstances where their employer has failed to provide the employee with a reasonable opportunity to take it, or failed to warn them before the year end that it will be lost if not taken.

It's likely that most employers will need to review and revise their internal processes and policies, even if it is just to ensure that close to the holiday year end a prompt is timetabled to alert employees that they need to take their holiday or lose it.

The general view is that a UK general election is expected in the latter part of this year. In the event that Labour gets into power, it’s worth knowing what they have outlined as potential labour law reforms.

The following provides a quick run-down of what has been reported to date.

• Removing the qualifying period of service for unfair dismissal claims (currently 104 weeks) and removing the limit on compensation (currently £115,115).
• Extending unfair dismissal rights to individuals with ‘worker’ status (currently only available to individuals with ‘employee’ status). Other employment rights will also be extended to workers (removing the distinction with ‘employees’).
• Banning zero hours contracts.
• Banning ‘hire and refire’ practices.
• Strengthening collective bargaining rights.
• Introducing the right to switch off.
• Extending maternity and paternity leave.
• Reviewing shared parental leave.
• Protecting pregnant women and women on maternity (and within six months of their return) from dismissal.
• Introducing ethnicity pay gap reporting for employers with over 250 employees.

Labour has suggested that some of these changes will be ushered in within 100 days of coming into power.

Some key cases since our last update.

Redundancy Consultation – how early?

In the case of De Bank Haycocks v ADP RPO UK, the Employment Appeals Tribunal (EAT) found that a dismissal for redundancy was unfair, due to a lack of meaningful consultation at the formative stages of the redundancy process.

The claimant was employed by a UK subsidiary of a US recruitment company which had suffered a halving of its client base following COVID-19, resulting in a need to reduce its headcount. The business decided to reduce the headcount by two and applied a standard scoring matrix which ranked the claimant in last place. The business then held consultation with the claimant and invited him to make suggestions that could potentially save the role. The selection scoring process was not described to the claimant and following a further meeting the claimant was then presented with a termination letter. The claimant appealed against his dismissal and as part of the appeal process, he was talked through the selection scoring, and his appeal was ultimately rejected.

The claimant brought a claim for unfair dismissal which the Employment Tribunal (ET) dismissed finding that the employer’s redundancy and appeal procedures were fair and reasonable.

The claimant appealed to the EAT on the basis that the ET has failed to correctly consider the absence of meaningful consultation. The EAT agreed stating employees should be consulted at the formative stages where their input could be a real difference to the potential outcome. In this case there was a clear absence of early consultation and therefore the termination was unfair.

The case highlights that the overriding purpose of redundancy consultation is to explore all possible ways of avoiding dismissals or reducing their impact. Employers should therefore consult with relevant parties at a stage when redundancies are merely being contemplated. For international organisations where decisions are often made by an overseas parent company this can be difficult to apply in practice.

Flexible Working – remote worker – Wilson

The claimant had been employed as a senior manager at the Financial Conduct Authority since 2005, with responsibility for 14 team members. Shortly before the COVID-19 pandemic, she began to work from home for health reasons. At the end of the pandemic the FCA adopted a policy which required staff to attend the office for a minimum of 40% of their working time. At the beginning of 2023, the claimant submitted a flexible working request to work entirely from home.

Her request was declined and her appeal against the decision was also rejected on the basis that it would have a detrimental impact on her performance. The claimant therefore commenced proceedings in the Employment Tribunal (ET) claiming that the FCA had relied on incorrect facts (that her performance would suffer) and that the process to make a decision had extended beyond the prescribed three-month requirement.

On the time limit breach, the ET took the view that it was a minor infringement, awarding one week’s pay in compensation (the maximum award available is eight weeks pay).

On her claim that the FCA had relied on incorrect facts, the ET held that her role as a senior manager involved some tasks such as inducting new team members, internal training and weekly meetings which were better performed in the office and the fact that she had performed these well from home did not mean that the tasks could not be better performed in the office. As a result, the ET found that the FCA had genuinely considered the application and her claim therefore failed.

Protected Philosophical belief – Anti Zionist

In February 2019, Professor Miller delivered a lecture at the University of Bristol in which he commented that Zionism was a factor in promoting Islamophobia. In response pro-Zionist groups alleged his views were antisemitic. The university commissioned an independent investigation which found his comments were not Anti-Semitic and instead, engaged the principles of academic freedom and therefore was covered by the freedom of expression protections of the European Convention of Human Rights. Despite his protests the University did not make a statement that he had been vindicated.

In 2021, Professor Miller delivered a lecture on free speech in which he spoke about his experiences of being berated by various Jewish bodies. Subsequent to this, Miller became the target of a smear campaign alleging that he placed his students at risk and that he had made Anti-Semitic remarks.

A further independent investigation again found he had not been Anti-Semitic. However, in applying its own internal policies the University held that his comments regarding some students and societies constituted gross misconduct and he was terminated in October 2021.

The Employment Tribunal found that he had been unfairly dismissed and discriminated against for his belief that Zionism is ‘inherently racist, imperialist and colonial’. His Anti-Zionist belief qualifying as a philosophical belief and therefore a protected characteristic under section 10 of the Equality Act 2010.