January 11, 2023
Another year, another host of employment law updates to look forward to! Welcome to the first Worked Up of 2023!
The focus of this month’s edition is a preview of the expected employment law developments for 2023. However, before we get to that, we wanted to quickly look back at employment law past and provide an update on the Court of Appeal’s decision in Arvunescu v Quick Release (Automotive) Limited  EWCA Civ 1600 which fell at the end of last year. The case related to an alleged act of victimisation against the Claimant and whether this had already been settled by virtue of a previously signed COT3 agreement. In said COT3, the Claimant had accepted a payment in full and final settlement of all or any claims that he may have that arose directly or indirectly out of or in connection with his employment.
The Court of Appeal helpfully held that the Claimant’s victimisation claim was clearly caught by the COT3 wording and provided a useful reminder of the benefits of a well drafted settlement and the importance of including claims arising “out of” and “in connection with” employment in any settlement language.
In this month’s update, we’ll be looking at expected developments in employee and worker protections, family friendly rights, flexible working requests, working time as well as setting out the rate changes that apply post April 2023.
If you would like to discuss any of the below updates, please do get in touch. Alternatively, if you would like to receive these updates directly to your inbox, please subscribe here.
This month's headlines
Developments in protections for workers and employees
2023 looks likely to have some key developments in store regarding employee and worker protections. Perhaps most notably, we could be bidding farewell to TUPE, the 48-hour capped working week and collective consultations on 31 December 2023 if the Retained EU Law (Revocation and Reform) Bill, which is currently at report stage, goes all the way and revokes the secondary legislation used to implement these EU law initiatives. While there’s a 12 month stretch before the Bill kicks in and a possibility that the sunset date could be extended until the end of 2026, the importance of this Bill should not be underestimated and we should expect some developments with this Bill and the legislation it affects during the course of this year.
Also at report stage is the Worker Protection (Amendment of Equality Act 2010) Bill, which seeks to introduce duties and potential liabilities of an employer in relation to sexual harassment of its employees and workers by third parties such as clients and customers. Meanwhile, the Employment (Application Requirements) Bill, which aims to eliminate discrimination against applicants who don’t hold minimum qualifications that aren’t strictly necessary for the role, is at the second reading stage.
Following the numerous reports of “fire and re-hire” practices last year, the Government also has a statutory code of practice lined up to clamp down on these “fire and rehire” tactics, whereby employers dismiss workers before rehiring them on less favourable terms. Courts and tribunals will be required to take the code into account when considering relevant claims, such as unfair dismissal, and will be able to uplift an employee’s compensation by up to 25% where an employer unreasonably fails to follow requirements. The code is due to be published soon – we’ll keep you updated as this develops.
In more contentious news, East London Employment Tribunal is set to decide whether Uber discriminated against drivers by implementing facial recognition software understood to have higher error rates when used by people with darker skin. Two claimants allege that their driver account profiles were deactivated after the software wrongly decided that their verification photos were of other people, leaving them unable to work. As we’ve previously mentioned in Worked Up, the use of artificial intelligence and algorithmic processing in the workplace isn’t without risk, so the fact that we are seeing claims in this area isn’t surprising. Rather, these types of claims indicate the increased creep of artificial intelligence and automated processing techniques within the employment landscape.
New Family Friendly Rights
Family friendly rights for employees also look likely to be bolstered this year, with a collection of bills working their way through Parliament. Several of these bills cover additional leave entitlements – if passed, the Neonatal Care (Leave and Pay) Bill would provide up to 12 weeks’ paid leave for parents whose babies are admitted into hospital for neonatal care for at least seven days (currently at report stage), the Miscarriage Leave Bill would offer three days’ paid leave for mothers and their partners who experience miscarriage or ectopic or molar pregnancy before 24 weeks’ gestation (currently at second reading), and the Carers’ Leave Bill, as you may remember from our November update, would introduce a day-one right to one week’s unpaid leave per year for employees who are providing or arranging care (due to go through the report stage on 3 February 2023). Further, the Fertility Treatment (Employment Rights) Bill, currently at its second reading, is set to require employers to allow employees to take paid time off to attend fertility treatment appointments. In addition, if an employee has a “qualifying relationship” with a person receiving fertility treatment, the Bill proposes that the employee should be entitled to take unpaid time off work to accompany that person to their fertility appointments.
Additional protections for new and expectant mothers at risk of redundancy are also included in the Protection from Redundancy (Pregnancy and Family Leave) Bill, now at report stage, which would give employees the statutory right to oblige employers to offer them a suitable alternative vacancy (where one exists) before offering redundancy.
This increased focus on leave and protections relating to family life will be welcomed by many employees and is perhaps not unexpected in light of the continuing use of fertility treatment and more female MPs than ever before in Parliament to back these bills.
Updates to flexible working requests, working time and unlawful wage deductions
We’re sure you’re all on tenterhooks waiting for the Supreme Court judgment in Chief Constable of the Police Service of Northern Ireland v Agnew, heard on 14-16 December 2022. The case, which is on appeal from the Court of Appeal in Northern Ireland, concerns whether a series of unlawful deductions from pay is broken if the deductions are more than three months apart. If the Supreme Court finds that such a series of deductions isn’t broken by a three-month time gap, this will overturn the current precedent in English and Welsh law. While the two-year backstop in place in England, Scotland and Wales will limit how far workers will be able to claim for unpaid holiday, the Supreme Court’s decision could nevertheless open up employers to holiday pay claims which may have significant financial consequences, particularly if the worker is based in Northern Ireland, where there is no such backstop. With holiday pay always a hot topic for the Film and TV industry, we’ll be keeping a very watchful eye on this one.
On the potential legislation front, the Flexible Working Bill is set to allow employees to make two flexible working requests in 12 months and reduce employers’ decision time to 2 months. As the government has already confirmed it will support this Bill (currently at its second reading) in response to its 2021 flexible working consultation, it looks likely that this Bill will become legislation. From a practical perspective, the reduction in response time for employers does have the potenital to cause difficulties, as employers will need to handle the initial response to a flexible working request and any appeal in a much shorter time period than at present.
Meanwhile, the Working Time Regulations (Amendment) Bill (also at its second reading – a strange coincidence for many of these bills) is seeking to reduce the maximum working week from 48 hours to 32 per week and to provide for overtime pay. While this sounds significant, it may just result in more employers getting workers to contractually opt out of the Regulations, so it’s hard to tell quite how much impact this Bill would have if passed. And it’s far from guaranteed that this one will make it onto the statute book!
Upcoming increases to annual rates
In other news, the Department for Work and Pensions has published its annual rate increases for 2023/2024. From April 2023, the following rates will increase:
- Minimum wage and national living wage are set to increase as follows:
- 23+ – £10.42 (previously £9.50)
- 21-22 – £10.18 (previously £9.18)
- 18-20 – £7.49 (previously £6.83)
- 16-17 and apprentices – £5.28 (previously £4.81)
- Statutory maternity, paternity, adoption, shared parental and parental bereavement pay rates will increase to £172.48 per week (previously £156.66).
- The statutory sick pay rate is set to increase to £109.40 per week (previously £99.35).
With the increase of inflation and the rise of cost of living, these increases are more substantive compared with previous years and will be welcome news to many employees and workers.