Small Business News: Brexit | IR35 | Maternity | Mental Health

Brexit and UK Employment Law

All current employment legislation will still apply post Brexit. The European Union (Withdrawal) Act 2018 ensures that all direct EU-derived legislation in operation in the UK prior to the date of exit will remain in place following that date. When free-movement of labour ends, the government proposes to install a skills-based immigration policy to ensure employers can access skills that add most value to the UK economy.

Calculating Holiday Pay (June 2019)

The latest Court of Appeal decision about holiday pay has held that both voluntary and non-guaranteed overtime must be included in the calculation of holiday pay if it is sufficiently ‘regular and settled’ for payments to amount to normal remuneration.

Kay’s comment: Although tribunals will assess each case on its own merits, the safest option for most employers will now be to include all overtime payments in future holiday pay calculations, to avoid any future legal claims. However, this will require careful budgeting and planning.

IR35 Extension to the Private Sector (April 2020)

The extension of IR35 tax rules to the private sector has been pushed back until April 2020 and will not apply to small employers of under 50 employees or with a turnover below £10.2m. The rules are aimed at reducing tax avoidance for off-payroll contractors working through personal service companies (PSC). Since April 2017 public sector employers became responsible for deciding if IR35 applies, and where relevant, deducting tax and NICs from contractors’ fees.

Kay’s comment: Tax, legal and recruitment bodies are arguing that implementation will damage the UK’s work flexibility. They are campaigning for a postponement until April 2021. A number of implementation problems have been cited including difficulty in establishing the true size of a company, navigating complicated multi-entity chains, criticisms of the HMRC online tool itself, CEST (Check Employment Status for Tax), for giving inaccurate results and the increased administrative burden on employers to take on compliance requirements. Employers of all sizes should review their workforces and consider making contractual changes to better reflect their actual worker relationships.

Additional Maternity Protection

The government is considering extending legal protection against redundancy for pregnant women and new mothers on maternity leave for up to six months after they return to work. The recent consultation also proposed that protection is provided for those returning from adoption and shared parental leave. Currently no implementation dates have been set.

Kay’s comment: Unfortunately, a shortage of flexible family-friendly work options, prohibitively expensive childcare and societal expectations for women to be primary care givers still force many women out of work, so new legislation to support new mothers and parents is unlikely to have a significant impact.


Mental Health for Small Workplaces: FREE e-learning for managers and employees

This e-learning course has been developed by the charity Mind, in conjunction with the FSB – there are 3 modules each taking about 20 minutes to complete.

Preventing Age Discrimination: FREE age discrimination prevention guide

This ACAS guide defines different types of age discrimination and gives an overview of where discrimination can occur and ways to avoid age stereotyping


Please Note: The information contained here is provided for your general use only.  It should not be treated as a substitute for obtaining professional employment advice on specific issues.

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