The government has published a call for evidence on non-financial reporting. It has also published further details of the proposed reforms to employment law announced in its policy paper earlier in May 2023 on non-compete clauses and retained EU employment law on working time regulations and TUPE Regulations. These proposals build on the Smarter regulation to grow the economy policy paper which set out how the government would seek to improve regulation post-Brexit.
As discussed in our blog post here, the government is no longer proposing to repeal all retained EU law at the end of the year. Instead, it is targeting specific areas for revocation and reform.
Non-financial reporting review – call for evidence
The Department for Business and Trade (DBT), working with the FRC, has launched a call for evidence on the non-financial reporting requirements that UK companies have to comply with.
The call for evidence recognises that reporting requirements for companies have expanded over time, increasing the size and complexity of annual reports. Through an online survey, the DBT asks a series of questions relating to:
- the costs and utility of current non-financial annual reporting;
- opportunities to streamline existing annual reporting requirements;
- reporting requirements outside the annual report, including modern slavery statements and gender pay gap reports; and
- the thresholds and definitions used to determine whether companies and LLPs must comply with certain reporting requirements.
The call for evidence also reiterates the government’s plans – announced in its Green Finance Strategy in March 2023 – to introduce requirements in two areas:
- Sustainability reporting – It intends to implement the new International Sustainability Standards Board (ISSB) standards, once finalised and made available (expected to be in June 2023). The ISSB is tasked with setting new global sustainability accounting and reporting standards, which can then be adopted by individual countries; and
- Transition plans – It will consult on the introduction of requirements for the UK’s largest companies to disclose their transition plans, drawing on the outputs of the government’s UK Transition Plan Taskforce (TPT). The TPT’s call for evidence closed in July 2022 and it is reviewing the responses received. It plans to publish its disclosure framework and implementation guidance in autumn 2023, with sector guidance to follow later.
The DBT’s call for evidence closes on 16 August 2023. It plans to use the information collected to develop detailed proposals for public consultation next year, and then look to legislate for any changes.
Employment law reform
The government has published further detail on its proposed reforms to employment law, which include:
- introducing a statutory limit of three months for non-compete clauses in employment contracts;
- removing the requirement for employers to keep records of all workers’ actual daily worked hours; and
- proposals around TUPE transfers for smaller employers.