April brings with it the usual annual increases to the national minimum wage and statutory pay for family-friendly leave and sickness absence. But the effects of Good Work: the Taylor review of modern working practices, published in 2017, are still being felt and changes are being introduced to protect vulnerable workers in increasingly flexible business models.

Changes to IR35 tax rules were also expected (but these have been deferred until April 2021) along with the introduction of the right to parental bereavement leave. A raft of other measures designed to protect vulnerable workers also come into force.

Employers
should prepare for changes on the following dates:

From 1 April 2020

• Increase in the national living
  wage for workers aged 25 and over from £8.21 to £8.72 per hour.
• Increase in the national minimum
  wage for workers aged at least 21 but under 25 from £7.70 to £8.20 per hour.
• Increase in the national minimum
  wage for workers aged 18 but under 21 from £6.15 to £6.45 per hour.
• Increase in the national minimum
  wage for workers aged 16 or 17 from £4.35 to £4.55 per hour.
• Increase in the apprentice rate from
  £3.90 to £4.15 per hour.
• Increase in the accommodation
  offset from £7.55 to £8.20 per day.

From 5 April 2020

• Increase in the rate of statutory
  maternity, paternity, adoption and shared parental pay from £148.68 to £151.20 per
  week.

From 6 April
2020

• Increase in statutory sick pay from £94.25 to £95.85
  per week.

Bereavement
leave

From 6 April 2020, bereaved parents will be entitled
to two weeks’ leave if their child dies or is stillborn and leave will be paid
if the parent meets certain criteria.

Statements
of particulars

The Employment Rights Act 1996
lists the information that must be given to an employee in a ‘statement of
particulars’ and this will have to be provided to workers as well as employees.
Casual workers and individuals on zero hours contracts are likely to be
categorised as workers and will benefit from this right. Determining worker
status is a thorny issue in employment law. As a rule of thumb, workers do not
have to accept offers of work unlike an employee. However, they do have to
perform the work themselves, rather than send a substitute, which distinguishes
them from a self-employed contractor.

The statement of particulars must
be provided before or on the first day of work, although some information, such
as relating to pensions and training, can follow within two months. Your standard statement of particulars or contract or employment may need
updating to include additional information, required by changes to the
Employment Rights Act 1996, such as the entitlement to training and other
benefits.

These changes apply to staff
joining on or after 6 April 2020 but watch out for triggers that entitle other
staff to a new style statement of particulars. This could be an individual asking
for a statement or making certain changes to terms and conditions.

Calculating
holiday pay

To take account of peaks and troughs in work for
casual staff and seasonal workers, the way in which holiday pay is calculated will
change. Holiday pay for those working irregular hours will be calculated using
average earnings over the previous 52 weeks. Before 6 April 2020, the average was
calculated over 12 weeks.

IR35
rules extend to private sector

The IR35 rules apply to contractors who provide services through a
limited company, but whose working arrangements are more like those of a
directly engaged employee.

Changes were due to come in  from 6 April 2020 (now deferred until April 2021) which would make the client, rather than the contractor, responsible for assessing the contractor’s tax status. If the individual is deemed an employee, the client has to deduct tax and national insurance through PAYE and pay employer’s national insurance contributions. This will bring the private sector in line with the public sector. Small businesses are exempt, using the Companies Act 2006 definition of a small company based on headcount, turnover and balance sheet.

The new rules will only apply to services delivered after 6 April 2021.

Brexit

Finally, a brief word on Brexit. The UK is now in the transition period, which runs until 31 December 2020. During the transition period, free movement of workers continues and EEA workers can still work in the UK. Employers should be reminding their employees from EEA countries to apply under the settlement scheme for settled or pre-settled status. The deadline for applications is 30 June 2021.

It is business as usual for employment law until the end of the
transition period on 31 December 2020. EU law determines many areas of UK
employment law. We will keep a close eye on this year’s trade deal negotiations
and the likely impact on the future development of employment law.

We can advise you on how best to prepare for these changes, including updating contracts of employment and assessing the status of your contractors. Please contact our employment law experts.

This
article is for general information only and does not constitute legal or
professional advice. Please note that the law may have changed since this
article was published.