UK Employment Legislation | What is in Store for 2020?
Here is a round-up of some of the UK employment legislation developments for 2020.
Good Work Plan: Amendments to Agency Workers Rules
Effective: April 6th 2020
The ‘Good Work Plan’ was published in December 2018. The Government committed to abolishing a rule known as the ‘Swedish Derogation’. Which governed the use of agency workers.
The ‘Swedish Derogation’ allowed agencies to opt-out of equalising the pay of the agency staff with the permanent workforce when they had been with the same employer for more than 12 weeks, provided they paid the agency workers between assignments.
From the 6th April 2020, the ‘Swedish Derogation’ will be removed. Agency workers who have achieved the 12-week qualifying period will be entitled to equal pay to workers who are employed directly by the employer. Agency workers who currently have the ‘Swedish Derogation’ in their contract must be provided with written notification by the agency that it will no longer affect. This needs to be done on or before the 30th April 2020.
New Right to a Written Statement of Terms
Effective: April 6th 2020
From the 6th April 2020 ‘written particulars‘ (on basic employment terms and conditions) will be entitled to include workers as well as employees. This will need to be made available from day one of employment (see Part 3 of Employment Rights (Miscellaneous Amendments) Regulations 2019).
Currently, employers have up to two months to issue the statement to any employee working for them for more than a month.
Holiday Pay Reference Period Adjustment
Effective: April 6th 2020
The holiday pay reference period will increase from 12 weeks to 52 weeks from 6th April 2020. The reform is intended to improve the holiday pay for seasonal workers, who tend to lose out over the way it is currently calculated.
Tax on Termination Payments
Effective: April 6th 2020
Termination payments over the sum of £30,000 will be subject to employer NIC’s this is due to become law on this date, which was delayed from April 2018.
IR35 Rules for Private Sector
Effective: April 6th 2020
In the October Budget in 2018, former Chancellor Philip Hammond announced the IR35 tax rules will be extended to the private sector from April 2020.
IR35 rules are aimed at reducing tax avoidance for off-payroll contractors working through personal service companies (PSC).
The rules are aimed at reducing tax avoidance for off-payroll contractors working through personal service companies (PSC). From 6th April 2020, the new rules will apply to private sector businesses with an annual turnover of over £10.2 million or 50 or more employees.
HMRC has issued guidance on the new rules, Prepare for changes to the off-payroll working rules (IR35), and draft regulations and further consultation on 11th July 2019.
With the Government concentrating on Brexit this year the employment legislation changes are on the back burner. It is clear that once Brexit has taken place a lot of new legislations and changes will take place.
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