20th Feb 2020

Four employment law changes to look out for this April

With spring around the corner, check out our round up of the latest employment law changes that will come into force on Monday 6th April 2020, including changes to the IR35 rules, new parental bereavement rights and all new employees to have a right to a written statement of terms from day one…

To ensure your business is up to date, here’s a summary of the latest changes:

1. Changes to the IR35 rules for the private sector

Currently: The IR35 rules apply where an individual (contractor) personally performs services for another person (“client”) through an intermediary (usually known as a personal service company or PSC).  It is then the PSC’s responsibility, and not the client’s, to determine how the contractor’s fee should be taxed, and whether IR35 applies or not. 

From 6 April 2020: Changes to the IR35 rules will now shift that responsibility from the PSC to the client, to determine how the  contractor’s fee is taxed.  If the rules apply, the client will then be responsible for deducting tax and other payments at source – and will apply to all contracts entered into, or payments made on or after 6 April 2020.

The changes in the rules will only apply to private sector employers of a certain size, which satisfy certain criteria. 

If you work with contractors (via PSCs) and want to find out if your business will be affected by these new changes, and what you need to do, then get in touch to find out more.

2. New Parental bereavement leave and pay

Currently: Employed parents are already entitled as a day one right, to take a reasonable amount of unpaid time off to deal with emergencies involving a dependant, including dealing with a dependant’s death.

6 April 2020: The Parental Bereavement (Leave and Pay) Act 2018 is expected to come into force. If it does, bereaved parents will have the right to two weeks of leave following the loss of child under the age of 18, or a stillbirth after 24 weeks of pregnancy. This will be a day one employment right, and the leave can be taken as one block or two one week clocks.

Bereaved parents who have at least 26 weeks’ continuous service will also be entitled to receive statutory parental bereavement pay – paid at the same statutory rates as other family friendly rights (such as maternity / paternity leave)

This change is a trigger to review and update your existing family friendly policies, or even consider a new bereavement leave policy, to ensure employees are aware of what they are entitled to during such a difficult time.

3. Written statement of terms

Currently: Employees who have been continuously employed for more than one month, must be provided with a written statement of terms (i.e. a compliant contract of employment) within two months of employment starting.

From 6 April 2020: All new employees and also workers will have the right to a written statement of terms from day one of their employment. 

We recommend that you should therefore begin preparing the contract of employment during the recruitment stage, rather than once the employee or worker has commenced work.

4. Holiday Pay

Currently: Calculating holiday pay can be complicated, especially for those where the hours of work vary week to week, as to the rates of pay.  In doing this calculation, the current reference period for determining an average week’s pay is 12 weeks.

From 6 April 2020: The reference period will increase from 12 to 52 weeks. 

This means that employers will be required to look back at the previous 52 weeks where a worker has worked and received pay, discarding any weeks not worked or where no pay was received, to calculate the average week’s pay.

This change is intended to improve the holiday pay for seasonal workers, who tend to lose out over the way it is currently calculated.

If you need further advice or would like to discuss any of the above changes, and find out what steps your business needs to take then contact Mike Patterson on (01423 542778) or mikepatterson@berwins.co.uk

Recognised in industry guides Chambers & Partners and Legal 500, Mike Patterson is head of employment law at Berwins 

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