What to expect in 2024 – Employment Law changes and developments

By Nicola Smyrl

Partner

09 January 2024

Article Insights

Whilst employment law is always changing, 2024 looks set to be a period of significant change.

To help you keep up to date and prepare for changes in advance, we have set out below a summary of the expected changes and developments which are most likely to affect employers. Of course, matters may change if there is a change of Government in 2024. In this regard, Labour’s Deputy Leader, Angela Rayner has pledged to work with trade unions to bring forward an Employment Rights Bill within 100 days of entering office in a ‘cast-iron commitment’ to delegates at the TUC Congress. 

If you would like further information on any of the topics discussed in this update, please contact TW’s Employment Team here.

Family Friendly changes

The Neonatal Care (Leave and Pay) Act 2023

This legislation will allow parents of babies who are admitted into hospital aged 28 days or less the right to leave and pay if the baby is in hospital for a continuous period of 7 days or more. The Act will introduce statutory neonatal leave and pay for up to 12 weeks for parents of babies requiring neonatal care, which must be taken within 68 weeks of birth.

The leave will be available from day one of employment, although statutory neonatal pay will be subject to 26 weeks’ service and earning above the lower earnings limit (currently £123 per week). The introduction of this leave and pay is not expected until April 2025, giving employers time to update their policies and procedures to take account of the new entitlements.

The Protection from Redundancy (Pregnancy and Family Leave) Act 2023

This legislation will extend the protection for women and new parents against redundancy “during or after” an individual takes the relevant period of family leave. Under current rules, before making an employee on maternity leave, shared parental leave or adoption leave redundant, employers are obliged to offer them a suitable alternative vacancy where one exists in priority to anyone else who is provisionally selected for redundancy. Failure to do so means that any subsequent dismissal would be automatically unfair.

The new protection will apply from the point the employee informs the employer that she is pregnant, whether verbally or in writing, and will end 18 months after the birth. It will also protect new parents returning to work from adoption or shared parental leave for a similar period.

The new rules will apply:

• Where the employee notifies their employer of their pregnancy on or after 6 April 2024; and/or
• Where the period of maternity and adoption leave ends on or after 6 April 2024; and/or
• To a period of six consecutive weeks’ shared parental leave starting on or after 6 April 2024.

The Carer’s Leave Act 2023

From 6 April 2024, the Carer’s Leave Act will introduce a new and flexible entitlement of five days unpaid leave per year for employees who have a dependant with a long-term care need. As per other types of family related leave, the employee will be protected from dismissal or any detriment as a result of having taken time off. This applies from the first day of employment and there is no requirement to provide evidence other than self-certification. It is advisable for employers to introduce policies dealing with this type of leave in due course.

Paternity Leave

In April 2024, the government is expected to make minor changes to paternity leave. The changes include:

• Permitting fathers or partners to split their leave into 2 blocks of 1 week. Previously, only 1 block of 1 or 2 consecutive weeks could be taken.
• Fathers or partners will be able to take their leave and pay at any point in the first year after the birth or adoption of their child instead of only within the first 8 weeks.
• Adjusting the way fathers or partners give notice of leave and pay to their employer. The new measure will require an employee to give notice that they intend to take leave 15 weeks prior to the expected week of childbirth and then 4 weeks’ notice of dates prior to each period of leave.

The eligibility criteria for paternity leave and pay will remain unchanged at 26 weeks’ service as at 15 weeks prior to the expected week of childbirth.

Other possible family leave developments

It is likely that family related private members bills will be considered by Parliament in 2024.  Whilst the bills may not become law, it is likely that awareness of these topics will increase, and employers would be well advised to consider how to deal with the issues. These include the following:

• Fertility Treatment (Employment Rights) Bill

This legislation would require employers to allow employees to take paid time off from work for appointments in the early stages of fertility treatment (and for connected purposes relating to treatment) and provide for protection against detrimental treatment for exercising the right. Employers may want to consider providing training to managers on matters which can arise in connection with fertility issues and treatment within the workplace so that they can respond in a way that is sensitive and supportive of employees.

• Miscarriage Leave Bill

Under current laws, those who suffer pregnancy loss after 24 weeks are legally entitled to maternity/paternity leave & pay if eligible, however there is no legal provision for those who suffer the loss of a pregnancy before 24 weeks. This Bill would ensure 3 days of paid bereavement leave for employees who have experienced miscarriage, regardless of timescale. It is estimated that as many as one in four pregnancies ends in miscarriage. This Bill therefore has the potential to have a wide-ranging impact for employers.

National Minimum Wage

The Government has announced that from 1 April 2024, the rates will rise to:

• National Living Wage (NLW) for over-23s: £11.44 an hour from £10.42
• NLW for those aged 21-22: £11.44 an hour from £10.18
• National Minimum Wage (NMW) for 18 to 20-year-olds: £8.60 an hour from £7.49
• NMW Wage for under-18s: £6.40 an hour from £5.28
• The apprentice rate: £6.40 an hour from £5.28

Also from 1 April 2024, the highest rate of the NMW, the National Living Wage, will be extended from workers aged 23 and over to those aged 21 and 22, who have previously been paid a lower rate.

Additionally, an exemption which meant that the legislation on NMW did not apply to workers who live in their employer’s family home, are treated as a member of the family and are not charged for food or accommodation will end from 1 April 2024, meaning these workers are entitled to be paid at the relevant rate.

Working Time Regulations

Various changes will be made to the law relating to on holiday pay and working time in 2024, including:

From 1 January 2024

• Clarification that various EU based working time rights will remain in force despite Brexit. This includes rights for employees and workers to carry over leave that cannot be taken due to periods of sickness absence or family related leave.

• Defining what payments need to be included in holiday pay as “normal remuneration” for the first four weeks of holiday entitlement for employees and workers who earn regular payments in addition to basic salary.

• Removing the additional working time record keeping requirements set out in a recent European judgment which had held working hours and rest records must be kept for almost all members of the workforce, even if they worked regular hours.

• Requirement on employers to remind staff to take their holiday at regular intervals and that if they do not take it, it shall be lost at the end of the holiday year, subject to any carry over rules.

From 1 April 2024

• Providing a method of holiday accrual for irregular-hours and part-year workers (as defined in the legislation), based on 12.07% of the hours worked in the previous pay period. For workers on sick leave or other family-related leave, accrual will be based on average working hours over a 52-week reference period (for leave years starting on or after 1 April 2024).
• Permitting rolled-up holiday pay for irregular-hours and part-year workers (for leave years starting on or after 1 April 2024).

On 1 January 2024, the Department for Business and Trade published guidance on holiday entitlement and holiday pay illustrating the new rules in practical terms.  The guidance can be viewed at the following link:

https://www.gov.uk/government/publications/simplifying-holiday-entitlement-and-holiday-pay-calculations

Repeal of EU Law

The Retained EU Law (Revocation and Reform) Bill will ‘sunset’ (revoke) the majority of EU law so that it expires on 31st December 2023. Remaining EU legislation (to be known as “assimilated law”) will be retained, but can still be revoked, amended, or replaced. The new legislation will eliminate the principle of EU law supremacy, enabling courts to deviate from retained EU case law. This has potentially far-reaching implications as many key employment law rights are derived from EU Directives. As the extent of the implications are not yet clear, we will keep you updated with developments.

As a result of the above, the Equality Act 2010 (Amendment) Regulations 2023 are intended to reproduce in domestic law certain interpretive effects of retained EU law, as interpreted by court judgments, which provide protection against discrimination, and which would otherwise cease to apply from the end of 2023. This ensures that current protections in relation to pregnancy and maternity discrimination, equal pay, disability discrimination and indirect discrimination continue to apply.

Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE) Reforms

The Government intends to amend TUPE to enable small employers (fewer than 50 employees) and businesses of any size undertaking a transfer affecting fewer than 10 employees to consult directly with their employees if there are no existing worker representatives. This change will apply to transfers taking place after 1 July 2024.

Overhaul of law on tips and gratuities

The Employment (Allocation of Tips) Act 2023 received Royal Assent in May 2023.  The Act will require employers to pass on 100% of tips to staff with no deductions, other than those required by tax law.

Section 9 of the Act, which enables the implementation and maintenance of a statutory code of practice on the allocation of tips, was brought into force on 31 July 2023. A draft statutory code of practice on fair and transparent distribution of tips, and related consultation, was published on 15 December 2023. The consultation will remain open until 22 February 2024. The consultation poses 34 questions covering the size and nature of the business run, or worked in, by the respondents, how tips are accepted and distributed, the transparency of tipping practices and policies, and how the Tips Act will be implemented in their workplaces. The government intends to publish its response and the final version of the code in spring 2024, with a view to the code and the full measures of the Act coming into force on 1 July 2024. Further non-statutory guidance will be published in due course to accompany the code.

Flexible Working

The Employment Relations (Flexible Working) Act 2023 received Royal Assent in July 2023.  From 6 April 2024, the Act (and related secondary legislation) will:

• Remove the requirement for an employee to have 26 weeks’ service to make a flexible working request, this will be a “day one” right.
• Require an employer to consult with an employee if it is considering rejecting a request.
• Permit employees to make two requests in a 12-month period instead of one.
• Reduce the period in which an employer must respond to a request from three months to two months.
• Remove the requirement for employees to specify how the employer might deal with the effects of the flexible working request.

ACAS has also issued a draft Code of Practice on how to deal with flexible working requests once the new legislation comes into force.  Employers should consider updating their flexible working policies ahead of these changes.

Pensions (Extension of Automatic Enrolment) Act 2023

Once implemented, this legislation will lower the age at which eligible workers must be automatically enrolled into a pension scheme by their employer from 22 to 18. Having received Royal Assent on 18 September 2023, the Department for Work and Pensions have announced that they will launch a consultation on implementing the new measures in due course. We will keep you updated with developments in this area.

Strikes (Minimum Service Levels) Act 2023

Industrial action in relation to pay and conditions has been widespread in both the private and public sector and looks set to continue in 2024. New legislation will require minimum service levels to be met in certain industries for strike action to be lawful.

Under the Strikes Act, employers will be able to issue “work notices” to require certain workers to refrain from strike action in order to meet the prescribed minimum service levels, with no automatic protection against unfair dismissal for those who refuse. The full impact of the legislation will depend on the upcoming regulations; but it represents major change to UK trade union law as it allows the government to curtail trades unions’ power to cause disruption to public services through lawful industrial action.

Workers (Predictable Terms and Conditions) Act 2023

Under this new Act, all workers, including those on zero-hours contracts, will have the legal right to request a predictable working pattern. If the worker’s existing working pattern lacks certainty in respect of the hours they work or the times they work, or if it is a fixed-term contract for less than 12 months, they will be able to make a formal application to change their working pattern to make it more predictable.

Employers will have to notify the employee of their decision within one month of the request, and refusal is permitted provided it is on one of the prescribed grounds, which mirror the grounds for refusing a flexible working request. The Bill received Royal Assent in September 2023, and is likely to come into force in around September 2024. ACAS will be producing a new Code of Practice to provide further guidance to assist employers in managing this new right.

Duty to prevent sexual harassment

In October 2023, the Worker Protection (Amendment of Equality Act 2010) Act 2023 received Royal Assent. The Act will:

• Introduce a duty on employers to take reasonable steps to prevent sexual harassment of their employees.
• Give employment tribunals the power to uplift sexual harassment compensation by up to 25% where an employer is found to have breached the new duty to prevent sexual harassment.

As originally drafted, the Worker Protection (Amendment of Equality Act 2010) Bill also proposed the reintroduction of employer liability for harassment by third parties, which was removed from the Equality Act in 2013. However, the House of Lords removed this provision from the Bill on 14 July 2023. It has been suggested that the new statutory duty could extend to employers needing to take steps to prevent the sexual harassment of employees by third parties as well as by other employees, but this is open to interpretation. The Act is likely to come into force in around October 2024.

A new statutory code of practice on sexual harassment is expected to be introduced before the new statutory duty comes into effect.

Whilst employers should already be taking steps to prevent sexual harassment in the workplace, in light of the new statutory duty which will apply in due course, employers will need to ensure that they take steps to put adequate procedures and staff training in place to meet their obligations.

Draft code of practice on preventing illegal working

The Home Office has confirmed that increases to illegal working fines will take effect from 22 January 2024. To assist employers in avoiding fines, it has published a draft code of practice on preventing illegal working which, once approved by Parliament, will apply to all right to work checks from 22 January 2024. The draft code details how employers can establish a statutory excuse for right to work checks. Employers should review the code and ensure that their right to work check practices are compliant with the new requirements.

Restricting non-compete clauses

There is currently no maximum duration for non-compete clauses and an employer will generally be able to enforce a non-compete if it can prove that it is a reasonable restriction which goes no further than is necessary to protect a legitimate business interest. However, in May 2023, the government proposed a statutory cap on non-compete clauses of three months. However, no time frame has been announced yet for such legislation and this will happen when “parliamentary time allows”.  As the King’s speech in November 2023 made no mention of the reform, the likelihood of it being implemented before the general election is fairly low.

Dismissal and re-engagement

In response to previous mass redundancies announced by P&O Ferries without consultation or notice, in January 2023 the government published a draft Code of Practice on Dismissal and Re-engagement (fire and rehire practices). The Code sets out a step-by-step process that an employer should follow to explore alternatives to dismissal and to engage in meaningful consultation with trade unions and employee representatives or directly with the affected employees to find an agreed solution. The government’s response to the consultation and the final version of the Code of Practice is expected to be published in Spring 2024.

Non-disclosure agreements in educational settings

In May 2023, the Higher Education (Freedom of Speech) Act 2023 received Royal Assent. This will ban non-disclosure agreements (NDAs) in certain educational settings relating to sexual abuse, sexual harassment, sexual misconduct and other types of bullying or harassment. The relevant section of the Act will come into force on a day to be specified in due course.

Data Protection

The government is expected to pass its Data Protection and Digital Information Bill in 2024, which aims to maintain data protection adequacy with the EU while relaxing a few areas that may benefit employers, including a less expansive definition of personal data and a new ability to ignore vexatious or excessive data subject access requests.

TW’s employment law team is able to assist you with any queries relating to these matters, including updating policies and procedures and staff training.

Disclaimer: General Information Provided Only
Please note that the contents of this article are intended solely for general information purposes and should not be considered as legal advice. We cannot be held responsible for any loss resulting from actions or inactions taken based on this article.