Employment law in 2019: the certainties
Employment briefing: a look at some of the significant points on which developments can be confidently predicted in 2019
As we begin 2019, the uncertainties facing not just the legal world but our clients, ourselves as individuals and our families are, for most of us, unprecedented. Despite this, employment law is an area where there are some certainties and anchor points on which we can rely. Forewarned is forearmed, so let us take a look at some of what we can confidently prepare for this year.
The Good Work Plan
Following the 2017 Taylor review and the subsequent consultations in early 2018, the Government has now published its Good Work Plan. Its stated intention is to ensure that all workers have access to “fair” and “decent” work, that there is clarity in understanding the legal relationship between workers and employers (and others who engage those workers), and that the enforcement system is “fit for purpose”.
Soon afterwards, the Government introduced the first three of a series of statutory instruments, implementing some of the changes outlined. The Employment Rights (Miscellaneous Amendments) Regulations 2019 are the first phase and take effect from 6 April 2019. They increase the maximum penalty an employment tribunal (ET) can impose on an employer for breaches of certain employment rights, from £5,000 to £20,000. Other legislative changes arising out of the plan are scheduled for 2020.
Itemised pay statements
Also due to come into force on 6 April are amendments to the Employment Rights Act 1996, introducing a right for all workers to be provided with an itemised pay statement, enforceable at an ET. Payslips for hourly paid workers will require to specify the number of hours being paid for.
Pay data reporting
Under regulations in force on 1 January 2019, UK-listed companies with more than 250 UK employees have to publish certain executive pay data in their annual reports. The regulations are part of the Government’s efforts to improve transparency and accountability in corporate governance, and a response to criticism that companies should justify executive salaries.
Gender pay gap reporting became mandatory for private employers with 250 employees or more as of 6 April 2017, with the bringing into force of s 78 of the Equality Act 2010. Employers had 12 months to publish their pay gap data, and many left it to the last days before the deadline of 4 April 2018. Many accompanied their reports with commitments to reduce their gender pay gap. The second reporting date, 5 April 2019, fast approaches and it will be interesting to see whether there is another last minute flurry and how ongoing gaps will be explained this time round.
What do Uber, a global headhunting organisation and an English rural constabulary have in common? All three are involved in much anticipated appeals to be heard by the Supreme Court and Court of Appeal this year.
By the time this briefing reaches you, the Supreme Court is expected to have heard the appeal in Tillman v Egon Zehnder Ltd, in which the Court of Appeal found a six-month non-compete restrictive covenant to be invalid. Centring on the phrase “interested in”, it is the first case involving construction of an employment restrictive covenant to be decided by the Supreme Court (or the House of Lords) in more than 100 years.
Chief Constable of Norfolk Constabulary v Coffey will see the Court of Appeal grapple with the issue of perceived disability for the first time. The ET and Employment Appeal Tribunal (EAT) have held that the claimant had an actual or potential disability (hearing loss) which would require the Constabulary to make adjustments to her role, now or in the future. The ET concluded that the decision to reject her application to become a constable because she “might not be fully operational” amounted to direct discrimination.
Uber (again) is likely to hit the headlines when the Supreme Court hears its employment status case. The Court of Appeal recently agreed with the tribunals that Uber drivers are workers. However, a former EAT President gave a persuasive dissent, so the Supreme Court may have a different perspective.
Codes and consultations
2019 sees various consultations, and responses, awaited on aspects of employment law. ET reform and ethnicity pay reporting closed in January and the Government should be publishing its views later in the year. On 17 December, the Government launched a consultation on whether certain aspects of national minimum wage legislation should be amended to ensure they do not inadvertently penalise employers. This closes on 1 March 2019 so there is still time to submit your views.
Other developments to look out for include a new statutory code of practice on sexual harassment, to be produced by the Equality & Human Rights Commission.
Senior Managers and Certification Regime
The UK Senior Managers and Certification Regime (SMCR) will soon add another layer of regulation to the financial services sector. The SMCR triggers a wide range of employment considerations for FCA-regulated firms, such as ever-clearer statements of responsibilities, conduct rules and whistleblowing obligations. The SMCR will be extended to all firms authorised under the Financial Services and Markets Act 2000 on 9 December 2019.
Claire McKee, associate, Dentons UK & Middle East LLP