On 10 May the UK government made a series of announcements that affect employment law.
Firstly, a significant change to the Retained EU Law (Revocation and Reform) Bill means that we are no longer on tenterhooks about what EU laws will continue to apply. The sunset clause, which provided that EU law would be automatically revoked on 31 December 2023 unless expressly retained, has been scrapped. Instead, the reverse now applies, with current laws remaining binding unless and until they are revoked. The government hopes this will provide some certainty for businesses, and while it commits to reviewing and amending EU laws, this new position allows for more time for proper assessment and consultation.
Secondly, the government has announced regulatory reform announcements specific to employment law in the areas of working time and the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE):
- The UK’s Working Time Regulations 1998 (WTR) are derived from EU Law, and while providing valuable protections for workers, are often seen as burdensome and complicated to navigate. It is therefore unsurprising that reforms to the WTR are high on the government’s agenda post-Brexit. The announcement about reforms in this area is light on detail but appears limited to changes aimed at reducing the administrative burden around employers’ recording keeping requirements and to holiday entitlements and pay. There is no suggestion of any reduction to holiday entitlements. The government also intends to permit the use of rolled-up holiday pay, and to reduce the complexity and administration around how holiday pay is calculated. It is presently unclear what is meant by this, but as the calculation of holiday pay has become particularly complicated in recent years following case law on the inclusion of commission and overtime, this is one area where reforms may be welcomed by workers and businesses alike.
- The TUPE rules are similarly derived from EU Law, and while the government recognises that TUPE provides valuable protections for workers who work in businesses or services which transfer elsewhere, it intends to consult on changes to the information and consultation requirements. Under current rules, there is an obligation to consult with elected representatives on all TUPE transfers unless the micro-business exemption applies (i.e., where the employer has fewer than 10 employees). However, in an attempt to reduce the burden on employers, the government will consult on removing these requirements for employers with fewer than 50 employees and transfers of fewer than 10 employees. It is unclear whether both limbs need to be met to be exempt, or if they are alternatives (an issue to be clarified, and for parties to have their say, during the consultation). We suspect that an exception for small transfers (irrespective of business size) will be welcomed by many
The announcement is referred to as the first in a series of regulatory reform announcements, and so we cannot rule out more proposed reforms affecting UK employment law in due course. We will provide further updates through our Employment Law Watch blog as and when we hear more about the consultations on the WTR and TUPE proposals, or any other planned changes.