Below is our annual review of some of the key legislative developments expected in 2016. For cases, see
11 January 2016: Zero hours contracts
Last year’s ban on exclusivity clauses in zero hours contracts has been strengthened by the Exclusivity Terms in Zero Hours Contracts (Redress) Regulations 2015, which give a right for zero hours workers not to be unfairly dismissed (without needing two years’ service) or to be subjected to a detriment if the principal reason for their dismissal or the detriment is failure to comply with an unlawful exclusivity clause. If they win, workers are entitled to receive compensation.
7 March 2016: Regulatory changes in the financial services sector
For those in the financial services sector, the Senior Managers and Certification Regime will come into force. It is designed to strengthen individual accountability and will replace elements of the existing approved persons regime.
Paul Callaghan, Head of Taylor Wessing’s Employment, Pensions and Mobility Group, and Alix Prentice, partner in our Financial Services and Regulatory practice, will be holding a webinar on 11 February. Register here if you would like to attend.
April 2016: Public sector exit payment recovery
Sections 154-157 of the Small Business, Enterprise and Employment Act 2015 came into force on 1 January, which allow the government to make regulations requiring employees who rejoin the public sector to repay some or all of the exit payment they received. Draft Regulations have already been published, providing that any public sector employee or office holder earning more than £80,000 per annum who is re-employed in the public sector within 12 months will have to repay any exit payment received on a tapering basis. It is expected that the Regulations will come into force in April 2016.
April 2016: Changes to the Points Based System
Contrary to what the media would sometimes have you believe, the UK already has a points based immigration system (for non-EU nationals). Changes are normally released in March 2016 to take effect from 6 April. The government is currently considering the results of consultation exercises conducted by the Migration Advisory Committee and published on 19 January 2016 which looks specifically at the Tier 2 route (for sponsored workers) and a separate consultation on the Tier 1 Entrepreneur route. For further detail on the Tier 2 MACreport, please see here.
Taylor Wessing’s Mobility experts, Vikki Wiberg, Charlie Pring and Sean Nesbitt, will be holding a breakfast briefing on Thursday 3 March 2016 on Employing International Talent: navigating the UK’s HR and Immigration Issues. Register here if you would like to attend.
6 April 2016: National living wage
In addition to the existing national minimum wage rates (which will remain unchanged at £6.70 per hour for those 21 and over, £5.30 per hour for those aged 18-20, £3,87 for under 18 year olds, and £3.87 for apprentices), a new minimum national living wage will be introduced for all workers aged over 25 of £7.20 per hour.
The National Minimum Wage (Amendment) Regulations 2016, with effect from 1 April 2016, also increase the financial penalty that may be imposed on an employer in a notice of underpayment from 100% to 200% of the amount by which a worker has been underpaid, for pay reference periods beginning on or after 1 April 2016.
Spring 2016: Gender pay reports
The gender pay reporting Regulations come into force in early 2016 because they have to be introduced within 12 months of the passing of the Small Business, Enterprise and Employment Act 2015, which happened on 26 March 2015. The law will apply to all employers in the private, public and voluntary sectors with 250 or more employees. However, the final form of the Regulations is yet to be published, including details of the information which must be included in reports (although the government has already confirmed that bonuses must be included). The penalty for non-compliance is expected to be £5,000, although employers are likely to be more concerned about possible reputational damage.
7 September 2016: Whistleblowing framework in financial services sector
In addition to the general law protecting those who blow the whistle, financial services firms will have to institute new internal whistleblowing procedures and offer protection to all whistleblowers including those who might fall outside UK law on whistleblowing. They must also appoint “whistleblowers’ champions” to oversee internal processes who must be appointed by 7 March 2016.
October 2016: the Immigration Bill
The Government is consulting on the roll out of the Immigration Bill. Amongst other things it will amend the existing offence of employing an illegal worker so that an offence would be committed by an employer who either knows or has reasonable cause to believe that a person is working without leave with an increased penalty from two to five years’ imprisonment. Further notices could be issued to close business premises if the Chief Immigration Officer is reasonably satisfied that an illegal working offence is being committed and the employer has a past history of breach of the immigration rules.
2016: Brexit referendum
The big one. No one knows yet when the referendum will be; it is expected to be sooner rather than later, although the only definitive information is that it will be before December 2017. Any renegotiation of the terms of the UK’s membership of the EU, or a decision to leave, may have considerable impact on domestic employment law, some of which is based upon EU directives.
2016: Trade union reforms
The precise implementation date of the Trade Union Bill 2015-16 is unknown. The Bill proposes the reform of the law on industrial action and trade union activities, including a requirement that 50% of eligible members must vote in strike ballots (and 40% of eligible members must vote for action in “key sectors”, suggested to include education, fire, health and border security roles amongst others). The changes would also extend the length of notice of strikes to be given to employers, remove the ban on using agency workers to cover strikers, and new rules to tackle intimidation of non-striking workers.
2016: Enforcement of awards and settlements
Section 150 of the Small Business, Enterprise and Employment Act 2015 introduces the power to impose a financial penalty of 50% of the unpaid amount on employers who, after a warning notice, still fail to pay tribunal awards or Acas settlements on time. The fine will be paid to the Secretary of State and is subject to a maximum cap of £5,000. It is not known when this will be brought into force.
2016: Public sector exit payments
The draft Public Sector Exit Payment Regulations 2016 will introduce a cap on the gross value of public sector exit payments of £95,000. The cap includes redundancy payments, payments by way of shares on loss of employment, and payments in lieu of notice, but not to payments for accrued untaken holiday, bonuses, court ordered damages or payments to those with terms protected by TUPE. It applies to the majority of public sector organisations, but not to members of the armed forces, employees of the BBC, Channel 4, the Financial Conduct Authority, the Prudential Regulation Authority, RBS and the Bank of England.