There are some big changes on the horizon.
Holiday Reforms for Term Time and Irregular Hours Workers
The well reported case of Harpur Trust v Brazel determined that ‘part-year workers’ (to include, but not limited to school term time workers) engaged under permanent or continuous contracts must receive at least 5.6 weeks paid holiday a year, even if they only worked for part of that year. This outcome didn’t sit well with most, as it resulted in part-year workers receiving the same holiday entitlement under the Working Time Regulations as someone working the full year.
New Regulations (applying to holiday years from the 1st of April 2024)
As such, and following consultation, these new regulations will override the Harpur Trust decision, and instead set out that, in the case of those who work “irregular hours workers” and “part-year workers”;
- Holidays will accrue based on 12.07% of the hours worked in the previous pay period. The accrual rate is 12.07% because this is the statutory annual leave entitlement (5.6 weeks) expressed as a percentage of the number of potential working weeks in a year (46.4 weeks).
- Employers will be able to ‘roll up’ holiday pay provided that holiday pay is calculated at 12.07% of their pay and is paid at the same time as their ordinary pay and the amount of holiday pay is itemised separately on workers’ payslips.
Now, we must stress that the above will ONLY apply to irregular hours and part-year workers (as defined below), and ONLY in relation to leave years which start on or after 1 April 2024.
Who are irregular-hours’ and part-year workers?
A worker is an irregular hours worker, if, under the terms of their contract, the number of paid hours that they will work in each pay period is wholly or mostly variable.
A worker is a part-year worker, if, under the terms of their contract, they are required to work only part of that year and there are periods within that year (during the term of the contract) of at least a week in which they are not required to work and, for which they are not paid. Periods of sick leave or statutory leave (such as maternity leave) are ignored.
If you employ part year workers or workers with irregular hours of work, please let us know, so we can ensure you are ready for the change.
Reforming TUPE consultation requirements for smaller businesses
Currently, businesses with fewer than ten employees may inform and consult with affected employees of a TUPE transfer directly if there are no existing appropriate representatives in place (for example, if there is no recognised trade union). Larger businesses, however, are required to arrange elections for affected employees to elect new employee representatives if they are not already in place, which can add to the complexity of the TUPE transfer process. The government will proceed with its proposal to remove the requirement to elect employee representatives for:
- Employers with fewer than 50 employees.
- Employers of any size involved in a transfer of fewer than 10 employees.
In either case, the employer will be able to consult directly with employees, where no existing employee representatives are in place. This will apply to TUPE transfers taking place on or after 1 July 2024.
Record-Keeping obligations under the Working Time Regulations 1998
As a result of European case law, employers are required to set up a system for recording actual daily working time for individual workers. This requirement created much uncertainty about what specifically needed to be recorded and how this would work in practice.
The government believes that the decision made within this European case law was disproportionate. It will therefore amend the Working Time Regulations 1998 to clarify that employers do not have to keep a record of the daily working hours of all workers IF they are able to demonstrate compliance without doing so. The new Regulations clarify that only “adequate” records need to be kept, in such manner and format as employers see fit.
Please contact us for further guidance and support in respect of any of the above.