HR Horizon Tracker

What’s on the horizon for employment law? Find out what HR directors need to prepare for in the coming months and beyond, in the third edition of our bi-annual tracker.

Pandemic, hybrid and flexible working

What to expect?

Since our last update, the onus has shifted away from top-down government guidance on managing Coronavirus at work towards responsibility on individual employers.

The government continues to consider evidence on the impact of ‘Long-Covid’. But specific new legislation recognising Long Covid as a disability seems unlikely. Employers should be mindful that notwithstanding this, claimants may argue that Long-Covid should be treated as a disability under existing legislation, triggering the duty to make reasonable adjustments and protection from discrimination.

In our last edition we reported that the government intends to introduce the right to request flexible working as a ‘day one’ right. The remains on the legislative agenda. But, contrary to expectations, the Employment Bill introducing this change was not included in the May 2022 Queen’s Speech.

When?

Spring/Summer 2022 and ongoing.

Actions to consider now

In line with government guidance in each of the UK jurisdictions, employers should now be managing Covid risk in line with their own risk assessments and infection control policies.

Although it is not certain that an Employment Tribunal would treat ‘Long Covid’ as a disability, commentary from the EHRC strongly suggests that this should be considered. We are aware of at least one Employment Tribunal decision which found that Long Covid was capable of amounting to a disability.

Hybrid and remote working arrangements, whether necessitated by the pandemic or in response to the cultural shift in attitudes towards atypical working, have become part of the ‘new normal’. Senior leadership should continue ensure that the health and wellbeing of staff who are out of ‘line of sight’ management is protected – both in terms of physical and mental health.

Keep a watching brief for the change to the right to request flexible working. The impact is, however, expected to be relatively limited.

ED&I and ESG workforce issues

What to expect

Equality, Diversity and Inclusion (ED&I) issues remain at the top of the social, governmental and corporate agenda.

More recently, there has been an increased focus on the role that employment law has to play to in environmental, social and governance (ESG) credentials.

Women’s health issues at work will remain a priority area for businesses and government. The outcome of a House of Commons inquiry into menopause at work is awaited. The introduction of ‘menopause’ as a new protected characteristic was floated as possibility by the inquiry. The government has confirmed that it has no intention of taking up that suggestion; but a number of cases have found that mistreatment because of menopause symptoms may fall under sex or disability discrimination protections. The landmark Fawcett Society report on menopause and the workplace, published in May 2022, is likely to be influential. In the longer term; specific menopause leave and support requirements may be on the horizon.

Socio-economic disadvantage and the disability rights agenda are two particular areas in which we expect greater focus in the near future (see also Reporting and transparency below).

Otherwise, we expect that the government’s strategy will continue to focus on transparency, reporting and self-regulation. Simultaneously, shareholders are likely to continue to flex their muscles to exert pressure on senior leadership in relation to all matters related to corporate responsibility.

The Financial Conduct Authority (FCA) made it clear during 2021 that it will be focussing on diversity in the financial services industry. We expect this will continue to be a focus for the foreseeable future. Reports for financial years beginning on or after 1 April 2022 will need to comply with new diversity disclosures.

The government has published a Bill of Rights Bill 2022-23. If enacted in its current form, the Bill would repeal the Human Rights Act 1998 and create a new human rights framework, with courts allowed to depart from caselaw of the European Convention on Human Rights.

In Europe, the European Commission has published a proposal for a Directive on Corporate Sustainability Due Diligence, which will affect large UK companies which are active in the European Union.

When?

During 2022 and ongoing

Actions to consider now

Active Board level engagement and leadership on promoting ED&I and ESG targets will be required.

Boards must keep up to date with the latest developments and visibly lead on the prevention of all types of discrimination and harassment, beyond individual protected characteristics, and avoiding a ‘tick box’ approach.

Regardless of whether new legislation and / or guidance on menopause issues at work is published, we anticipate that this will remain a key area of focus. Employers need to get on the front foot and take action now to raise awareness and prevent disadvantage caused to employees experiencing menopause.

Although we are very far from any firm proposals on menstrual leave and support, this is another gap which has been identified and may need addressing.

The Bill of Rights Bill 2022-2023 should be kept under review. The Bill has been widely criticised and may well be significantly amended as it progresses through Parliament.

Reporting, enforcement and transparency

What to expect

The proposed introduction of ethnicity pay gap reporting, on which we reported in our last update, has now been withdrawn. Instead, guidance on voluntary reporting will be introduced (there is no timescale published at present).

As we reported in the last edition of this update, the government published its National Disability Strategy in July 2021. The strategy has since been declared unlawful due to inadequate consultation, but it has not been quashed. The broad proposals contained in the strategy are likely to be retained.

Scrutiny of ‘green washing’ (publishing misleading information about sustainable practices) continues to rise up the corporate agenda. Following the introduction of its Green Claims Code in September 2021, the Competition and Markets Authority has launched a review of ‘green’ claims in the fashion retail sector, with other sectors likely to follow.

It is possible that the new Future of Work review, announced in May 2022, may include further details of the government’s proposal to create a new Single Enforcement Body (SEB) for employment rights; marking a shift away from individual / Trade Union backed action for breaches. The Future of Work review will be undertaken during 2022, in two parts: a strategic analysis, and then specific areas of focus.

When?

Ongoing. No set timescale for creation of SEB – strategy will be published Autumn 2022 and will then require primary legislation.

Actions to consider now

Given that transparency obligations are expected to increase, it is prudent to consider the extent to which your organisation’s employment, equalities and sustainability data will withstand public scrutiny.

Greater scrutiny through the new SEB should be on your organisation’s radar, as an entirely new way of policing employment law rights. Compliance with holiday pay, the National Minimum Wage, modern slavery in supply chains and statutory sick pay are the key areas to audit ahead of the creation of this new body.

Keep a watching brief on the Future of Work review; it is not clear at the moment whether it will include further details of the establishment of the SEB but it will inform government strategy on its approach to employment law.

Employment contracts, staffing pressures and pay

What to expect

In response to Union pressure and the P&O Ferries debacle, the government will issue a new statutory Code of Practice on dismissal and re-engagement processes. There is no specific timescale for its introduction or for publication of a draft for consultation.

The pressure on businesses to recruit and retain staff is set to continue, in a highly competitive market. Post-termination restrictions are, therefore, likely to become more prevalent/relevant, but remain the subject of government review.

Due to a combination of the 2021 Uber case and, longer term, a Law Commission Review to follow the Taylor Review, this has become higher risk and also subject to likely further change.

A new EU Directive has been proposed which would require online platform companies, such as Uber and Deliveroo, to reclassify workers as employees.

A major pilot of a four-day working week (without any linked reduction in pay) is running from June-November 2022, led by Oxford and Cambridge Universities.

The landmark holiday pay case of Agnew v the Police Service of Northern Ireland (PSNI) has now been listed for 14 and 15 December 2002, in the Supreme Court. However, a decision is unlikely to follow until some months later.

When?

• Employment status reform TBC but within 5 years.
• Proposals for reform of post-termination restrictions (if any) expected in second half of 2022 / early 2023.

Actions to consider now

Be aware that dismissal and re-engagement procedures will soon be subject to a statutory code. When the draft Code is published for consultation this will need to be reviewed, ahead of the Code coming into force.

In response to increased competition for staff, employers may wish to consider amended/new employment contract provisions as part of a recruitment, retention and business protection strategy.

Keep developments on employment status under review and be mindful that the traditional categories of ‘worker / self-employed contractor / employee’ are likely to be eroded. Significant workforce redesign may be required in response to any reform of existing structures.

The proposed EU Directive will not apply to businesses operating in the UK, but will apply to EU operations and my affect government policy in the UK.

Now that mediation in the case of Agnew v the Police Service of Northern Ireland (PSNI) has broken down, employers in Northern Ireland will need to keep the outcome of the Supreme Court hearing in December 2022 under careful review. Increased holiday pay costs could be on their way for Northern Irish employers and may need to be included in budgets.

Look out for the conclusion of the four-day week trial at the of 2022. Depending on the outcome, a truncated working week may form part of employers’ long-term strategic planning.

EU withdrawal and workplace rights

What to expect

There is no immediate substantive change to the employment law framework resulting from the UK’s departure from the European Union. We do not anticipate that any major EU derived legislation will be repealed in its entirety; but some aspects may be reformed over time. Decisions of the European Court of Justice remain applicable to EU derived employment law but specified UK appeal courts have the power to depart from that case law if it is “right to do so”.

When?

Effective since the start of 2021 - but real changes likely in the medium/longer term

Actions to consider now

For now, HR Teams should operate on the basis that EU derived rules and laws remain effective. No major changes are currently expected. However in the context of what is a developing relationship between the UK and the EU, it is a watching brief.

Immigration and staffing

What to expect

Key changes to the UK’s visa and immigration regime are now in place, with significant reforms passed in Spring 2022.

Further significant changes are not expected in the foreseeable future (for now!). However, 2022 is the year businesses are emerging from the fall-out of Brexit and the Covid-19 pandemic whilst also trying to grow in a highly competitive market. This has forced many more employers to grapple with the UK’s complex immigration rules.

Dates to look out for in the short-term include the introduction of the new ‘scale-up’ migration route, and the Covid-19 immigration checking concession expiration on 30 September 2022.

Employers engaging staff in offshore wind farms should note that the concession to the Immigration Rules for this industry has been extended from 1 July 2022 to 31 October 2022, reportedly for the final time.

There are increasing calls to explore the labour needs of the food and farming sector, with the Environment Food and Rural Affairs Committee having asked the Migration Advisory Committee (MAC) to conduct a review on this. The MAC has suggested it expects to be commissioned in the coming months by the Home Office to review the shortage occupation list – which would include a review of occupations in the sector (and others). Separately, the Independent Chief Inspector of Borders and Immigration has launched an inspection of the immigration system in relation to the agricultural sector, including looking at the effectiveness of immigration routes available to agricultural workers.

Processing delays. Our of country visa applicants currently cannot access fast-track processing, to give priority to applications from Ukraine. It is not known how long this situation, and the resultant delays, will continue.

When?

• 22 August 2022 – ‘scale-up’ migration route introduced
• 30 September 2022 – expiration of Covid-19 concession
• 31 October 2022 – expiration of wind farm worker concession

Actions to consider now

Employers should ensure that their on-boarding and HR/compliance teams are fully briefed on the Spring 2022 immigration changes.

There is now only a short window of opportunity to ensure that right to work checking procedures are up to date ahead of the expiration of the Covid-19 checking concession on 30 September 2022.

Employers operating offshore wind farms also only have a short time to prepare for the end of their Immigration Rules concession in October, and must ensure that their crews are compliant with UK rules and working legally.

Employers in the food, farming and agricultural sectors should watch this space and be alive to consultation opportunities where they may be able to highlight particular challenges they face in recruiting labour. Employers in all sectors should keep an eye out for developments on the shortage occupation list, to support particular skills shortages they may be facing.

Employers should plan recruitment, sponsorship and visa requirements as far in advance as possible to secure candidates in this very competitive market. Those who don’t have a sponsor licence but need one, in particular, should commence that process as soon as possible to avoid missing out on candidates. The trend of increasing sponsor licence holders is likely to continue, which can in turn impact processing times.