After an eventful 2017 with the abolition of the employment tribunal fee system, 2018 is unlikely to take such a historic turn. Nevertheless, there are some key changes coming this year, as well as some potentially significant court decisions, which we spotlight below:
The first gender pay reports are due by 4 April. So far only 527 employers out of around 9000 that will need to publish reports have done so. Although there are no penalties for non-compliance in the regulations themselves the EHRC are currently consulting on an enforcement policy based on their general powers to impose sanctions including unlimited fines. It is debatable whether their powers are broad enough to legitimately do this. However, employers can still be “named and shamed” and the court of public opinion is likely to be enough to persuade most organisations to comply.
Taxation of termination payments
All payments made in lieu of notice will be treated as earnings and subject to tax from 6 April.
Foreign service relief
This will be abolished for UK resident employees from 6 April.
The new EU Data Protection Regulation (GDPR) will take effect in the UK from 25 May. Key changes include a wider definition of personal data, a “right to be forgotten” in some circumstances, tighter rules on the issue of consent and significant fines of 4% of worldwide turnover, or 20 million Euros (whichever is the greater), which is potentially transformational when compared to the current maximum fine of £500,000.
Taxation of termination payments
Termination payments above £30,000 will be subject to employer NICs from 6 April 2019. Some key court decisions expected in 2018:
Shared Parental Leave
We are awaiting judgement in two cases on the issue of enhanced shared parental pay. Two tribunals came to opposite decisions on whether it amounts to sex discrimination to pay a man on shared parental leave less than a female employee on maternity leave. Many employers will be keen to see this matter resolved by the Employment Appeal Tribunal (Capita v Ali; Hextall v Chief Constable of Leicestershire).
The "gig" economy
In February the Supreme Court will hear the appeal by Pimlico Plumbers against the finding that its plumbers were ‘workers’ and therefore entitled to worker rights, such as paid holiday. Whilst it is unlikely that the Supreme Court will overturn the decision, many in the “gig” economy will be watching with interest.
Pregnant worker protection
In 2017 the AG gave her opinion that pregnant workers should be protected from dismissal even before their employer has been told of their pregnancy. The ECJ’s full decision is anticipated this year and, if the AGs opinion is followed, will have far reaching consequences (Porras Guisado v Bankia SA and ors).
In March the Court of Appeal will hear Focus Care Agency Ltd v Roberts which will look at whether workers who ‘sleep in’ to carry out their duties if required are entitled to the national minimum wage for the whole shift, or only the time they are actually working. In a sector already financially pinched, the cost implications for the care industry of this decision may force some out of business.
The ECJ found, in the case of Sash Windows Workshop Ltd v King, that workers who are told they have no right to paid holiday can carry over their holiday rights indefinitely and be paid in lieu on termination. The case now returns to the Court of Appeal for the ECJ decision to be interpreted in light of UK law. How the court implements this decision will be of concern to many employers who genuinely believed their workers to be independent contractors (and not “workers”), and now find themselves faced with potential liabilities going back many years.
What else is on the horizon?
There are also some developments we are expecting, however, it’s not yet clear when they will be implemented:
The “gig” economy
The Taylor Review was published last summer and the Government has stated it intends to publish a discussion paper in response, exploring the options for longer term reform of employment status. In the meantime a joint report has been published by the Work and Pensions and Business, Energy and Industrial Strategy Committees urging a Brexit-distracted Government to tackle the urgent labour reform required. This report appears to have cross-party support so we will see if this issue is escalated in the Government in-tray.
Whilst this was originally expected in 2018, the consultation on this was delayed due to Brexit and no further information has been provided. It is not clear when, or if, this will be taken forward.
It is anticipated that this will be implemented by 2020 and will enable parents who lose a child to take two weeks leave.
The Department for Business, Energy and Industrial Strategy is scheduled to review the Shared Parental Leave Regulations and the Parental Leave Regulations in 2018; and the early conciliation scheme and Flexible Working Regulations in 2019.