During January the UK government introduced legislation to impose minimum service level requirements in some sectors during industrial action. It is also consulting on how to calculate holiday entitlement for part year and irregular hour workers and pressing ahead with plans to “sunset” retained EU law at the end of 2023, although there are some indications that this may not result in sweeping changes to worker rights.

After a period of limited activity on the employment law front, during January 2023 the UK government announced reforms to industrial action legislation, published a consultation paper dealing with the ramifications of the Supreme Court decision in Harpur Trust v Brazel and held the third reading of the Retained EU Law (Revocation and Reform) Bill.

Industrial action

The Strikes (Minimum Service Levels) Bill allows the government to impose minimum service levels in relevant sectors, including rail, education and the health service.

It appears that, if the Bill becomes law, the government intends to mandate the minimum service levels that will apply in the rail, fire and ambulance sectors, subject to consultation about what the relevant service levels should be. The government expects employers and employees in other areas covered by the Bill to enter into voluntary agreements about minimum service levels and will impose service levels only if agreement is not reached.

If industrial action takes place in a sector where minimum service levels apply, employers will be able to serve a “work notice” on a trade union, specifying which employees are required to work during industrial action in order to provide the relevant service and the work they will carry out. The union must be consulted about the work notice in advance. The union will be required to take reasonable steps to ensure that the employees named in a work notice do not participate in the industrial action.

If the union fails to take reasonable steps, it will lose its immunity from liability for strike action, leaving it open to damages claims. It will not be automatically unfair for an employer to dismiss an employee named in a work notice who nonetheless participates in strike action.

Holiday for part-year and irregular hour workers

The Supreme Court’s decision in Harpur Trust v Brazel last year established that a permanent part-year worker was entitled to 5.6 weeks’ holiday per year under the Working Time Regulations, paid at her average weekly rate of pay. Her holiday was not pro-rated to reflect her actual hours of work, even though this meant that she received more holiday than a part time worker with the same total hours who worked every week. The judgment had implications for employers of workers with irregular hours.

Recognising that the current situation creates anomalies, the government has published a consultation paper suggesting changes to the Working Time Regulations to ensure that all workers receive holiday that is proportionate to the time they spend working. It is proposing to introduce a fixed 52 week reference period for calculating holiday entitlement for part year and irregular hour workers, including weeks in which a worker did not perform any work. A worker’s total hours over the reference period would then be multiplied by 12.07% to calculate their statutory holiday entitlement. The consultation closes on 9 March 2023.

Brexit related changes to employment law

The Retained EU Law (Revocation and Reform) Bill passed its third reading in the House of Commons last week and will now be considered by the House of Lords. There has been much debate about whether it will significantly reshape employment law.

In simple terms, the law is intended to remove retained EU law, which was largely preserved wholesale at the end of the Brexit transition period, from domestic law. For employers, the most significant part of the Bill is the “sunset provision” under which much retained EU law will expire at the end of 2023, unless the government decides to preserve it (with or without amendment). Given how much employment law is European in origin, the sunset clause could in theory lead to fundamental changes to British employment law, although the Bill does not affect primary legislation such as the Equality Act.

To date the government has not indicated which employment regulations it intends to retain after 31 December 2023, leading to speculation about a “bonfire of worker rights”. Comments during the Bill’s third reading last week suggest that changes may be relatively modest. The government minister speaking in the debate described the suggestion that maternity rights could be removed as a “misinformation campaign” and pointed out that in many areas UK protections already go further than required by EU law.