Employment law rarely stands still, and the pace of change is set to continue in 2016. Below is a look ahead at what to expect in employment law for the coming year:


Regulations are expected early in 2016 requiring private sector employers with 250 or more employees to report on their gender pay gaps. Reporting is expected to include information about bonuses. At the time of writing, no firm dates for implementation have been set.


From April 2016, the government will introduce a new mandatory National Living Wage, for workers aged 25 years and above. The National Living Wage will initially be set at £7.20 per hour.
Financial Services Regulatory regime changes: a number of new measures will apply to those working in building societies, banks and some investment firms. These include:

  • Early 2016 - a policy statement containing new rules on regulatory references is expected. It is proposed that there are changes to the way firms and insurers seek and provide references;
  • March 2016 - a new regulatory framework (the Certification regime, the Senior Managers Regime and the Conduct Rules) will change the way in which individuals working in the financial sector are regulated;
  • September 2016 - new rules relating to whistleblowing in banks, building societies, certain investment firms and insurers and credit unions come into force.


The government has proposed amending the Working Time Regulations 1998 to allow for carry over of untaken holiday from one holiday year to the next. This would bring these regulations into line with decisions of the European Court of Justice. No date is set.


The Trade Union Bill aims to reform aspects of the law relating to industrial action, picketing and trade union governance. The Bill proposes the introduction of a minimum threshold of 50% of voters to turn out to vote in union ballots (with the requirement of a simple majority of votes in favour). It also requires that 40% of those entitled to vote do actually vote in favour of striking where the strike involves important public services – in addition to the 50% turn out requirement. Reform of the rules and code of practice concerning picketing is also included, as is the repeal of the prohibition on using agency workers to cover the work of strikers. This bill will continue its passage through parliament in 2016.


As well as legislative change, there are some decisions in cliff-hanger cases expected from the appellate courts and tribunals in 2016, for example:

Agency workers

Do agency workers on long term assignments qualify for the protection of the Agency Workers Regulations 2010 (AWR)? If not, the AWR have far lesser significance than generally thought. The issue has now reached the Court of Appeal (Moran v Ideal Cleaning Services Ltd), with a hearing anticipated in early March 2016.

Collective redundancy consultation

Collective consultation is required where an employer proposes to make 20 or more employees redundant at one ‘establishment’ within 90 days. Does that mean 90 employees at one branch, or the whole nationwide workforce? We are expecting the narrower interpretation – that only the numbers at one branch need to be considered – but are awaiting a hearing before the Court of Appeal (USDAW v Ethel Austin Limited (the Woolworths case)).

Unilateral variation of staff handbook

Can an employer (validly) unilaterally change a term of the staff handbook, with the effect that the absence management procedure was triggered sooner? Could an employer rely on a flexibility clause purporting to allow changes to the contract to be made? A decision of the Court of Appeal is expected in February 2016 (Sparks v Department of Transport).


Other employment matters under consideration include:

  • the Extremism Bill: the government plans to give employers the ability to check whether an individual is an extremist, and to bar extremists from working with children;
  • taxation of termination payments: further to a review by the Office of Tax Simplification, the government has been consulting on replacing the £30,000 exemption for termination payments. In 2016, we are expecting a summary of the response to the consultation;
  • a reform programme to increase the use of mediation to resolve disputes;
  • potential measures to stop employers avoiding the exclusivity ban in zero hours contracts;
  • changes to the regulation of recruitment agencies.

The above is not a comprehensive summary of everything that is anticipated in employment law for 2016, just some selected highlights. There are some employment initiatives that have been widely publicised, but do not look set to be implemented in 2016. One such example is grandparental leave. There is an intention to extend the shared parental leave and shared parental pay regimes to grandparents, with legislation expected in 2018. Another example is the proposed 0.5% levy on large employers to fund new apprenticeships, which will not come into force until April 2017.

Finally, the referendum on whether the UK and Gibraltar should remain in the EU must take place by December 2017. The EU Referendum Bill is currently progressing through parliament, and during 2016 there is likely to be much continuing speculation over how a ‘Brexit’ would impact upon employment law in the UK.

This article was originally published in Purely Payroll, January 2016