Government announces post Brexit changes to employment law

8 June 2023

The government has announced a raft of proposed changes to certain aspects of employment law now that the UK has left the EU. The initial proposals concentrate on holiday pay, working time records and consultation requirements under TUPE.

'Smarter regulation to grow the economy'

The government, in its policy paper named above, has announced a raft of proposed changes to certain aspects of employment law now that the UK has left the EU. This has been expected for some time, with much speculation as to what those changes would be, the expectation being that they would concentrate on business-friendly changes in an attempt to remove some of the burden from business and thereby help grow the economy.

The proposals (and our comment) include:

  • Holiday pay - To have a single basis of calculation for holiday pay, removing the current complicated situation whereby there are two types of statutory holiday entitlement (one EU based and the other UK based). Comment - This change is sensible, as the current two-tier system has created an overly complex system for employers and has added to the administrative burden.
  • Holiday pay - To reintroduce the ability to pay rolled-up holiday pay, currently outlawed. Comment – Some employer/employee working arrangements suit the ability to make rolled-up holiday pay; and indeed, some employers still make use of it anyway.
  • Working time – To consult on removing the requirement for businesses to keep working time records for almost all staff. Comment – This change is also sensible for the majority of staff, including those who work fixed hours or on a rota basis. For those working variable or zero hours, it is useful to keep a record of hours worked but many employers will be doing this anyway in order to ensure that holiday pay is calculated correctly and in case of any dispute about pay.
  • TUPE – To remove the requirement to consult with elected representatives for businesses with fewer than 50 people and transfers affecting fewer than 10 employees. Comment – The law currently allows businesses (of any size) to consult directly with staff where there is a transfer affecting less than 10 employees. As such, it is the addition of businesses with fewer than 50 people that will make a change.

According to the policy paper, this is the first in a series of similar regulatory reforms the government wish to put forward for consultation. There is, of course, one big issue amongst this, the fact that there will be a general election sometime in the next 18 months. Two questions immediately arise: First, will there be time to get all these reforms made and, secondly, what will a Labour government do if they form the next government?

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