IR35
As of 6 April 2020, private sector off payroll working rules are due to change. The end-user client will become responsible for determining the tax status of individuals providing services through an intermediary. They must also provide this determination in writing, along with reasons, to the individual and the next entity in the supply chain and create a process for resolving status disputes. The fee-payer will be responsible for accounting to HMRC for any income tax or NICs due.
Statement of Particulars
The right to a written statement of particulars will be extended on to workers as well as employees hired on or after 6 April 2020 and will be a day one right, meaning it must be given to them either before or on the first day of employment. The statement must also contain additional information, including the days of the week the worker must work, if the hours are variable, any paid leave they are entitled to and details of any other paid benefits.
Holiday Pay Reference Period
From 6 April 2020, the period of time employers must use to calculate workers’ holiday pay is being extended, from the current 12-week period to 52 weeks. Where a worker has been employed for less than a year, employers are to use the number of complete weeks as their reference period.
Taxation of Termination Payments
All termination payments after 6 April 2020 over £30,000 will be subject to Class 1A employer NICs.
Information and Consultation Requirements
The threshold for information and consultation requests is to be lowered on 6 April 2020, from 10% of the workforce to 2%. This new threshold will remain subject to the existing minimum of 15 employees making the request.
National Minimum Wage
As of 6 April 2020, the new rates for the NMW will rise to the following:
£8.72 for 25 years old and above
£8.20 for 21-24-year olds
£6.45 for 18-20-year olds
£4.55 for under 18s
£4.15 for Apprentices
Removal of the Swedish Derogation
The Swedish Derogation is to be abolished from 6 April 2020, with agencies required to inform their workers by 30 April 2020 that it no longer applies to their contracts. This will mean that all agency workers who have been employed by the same employer for 12 continuous weeks will be entitled to pay parity, i.e. the same pay and conditions as a direct recruit of that employer.
Parental Bereavement Leave
Parents who have lost a child will be entitled to two weeks’ leave, which may either be taken as two consecutive weeks or as two separate one-week blocks. They will have a period of 56 weeks in which to use this leave, and there is no period of qualifying service. It is expected that this right will come into force in April 2020, though the exact date is unknown.
Proposed Employment Bill
The new Conservative Government have announced plans to introduce an Employment Bill, which is likely to include an increase in the protected period for those on maternity leave in relation to redundancy, a new right for workers to request a more stable contract after 26 weeks, and the creation of a new Code of Practice to address the payment of tips to workers. The Bill may also include measures to make flexible working the default position for most job roles, and an increase to the length of time required to break continuity of service from one week to four weeks.