As 2024 unfolds, UK business owners face a significant wave of new employment laws. Navigating this already complex area becomes an even greater challenge with the introduction of numerous legal updates.
These changes, set to impact various aspects of employment, add to the existing responsibilities and stresses of running a business. Understanding and adapting to these changes is crucial, yet without proper guidance, staying compliant can feel like navigating a minefield.
This blog aims to demystify the upcoming legal changes, covering key areas such as leave entitlements, working patterns, redundancy protections, adjustments in the national minimum wage, holiday pay calculations, and pension enrolments. Join us as we delve into these important updates (in order of expected effective date) ensuring your business stays informed and prepared:
National Minimum Wage Increases (1st April 2024)
As we know, the National Minimum Wage (NMW) increases every year, but this year we are expecting to see more than just the standard changes with 21 and 22-year-olds moving to the highest band. All employers must ensure that they comply with the NMW rates as a minimum to avoid not only penalties but also inclusion on the governments ‘name and shame’ list which can have a significant impact on your ability to attract good staff. The new rates are:
Effective April 2024 Current rate
Under 18: £6.40 per hour £5.28 per hour
Apprentices: £6.40 per hour £5.28 per hour
Ages 18 to 20: £8.60 per hour £7.49 per hour
National living wage (21 and over): £11.44 per hour £10.42 per hour
Changes in Calculating Holiday Pay and Leave (1st April 2024)
Rolled-up holiday pay will be allowed for irregular hour workers, such as zero-hour and part-year workers for holiday years starting on or after 1st April 2024. The historical annual leave accrual method of calculation using 12.07% of hours worked in the relevant pay period will be reintroduced bringing a reduction in administrative burden and sigh of relief to many business owners.
Flexible Working Requests – New rules (6 April 2024)
Employees will gain the right to request flexible working from day one of employment (currently employees have to have worked for 26 weeks before requesting flexible working) and the right to make two requests per year (currently one). The requirement for employees to explain the effect of their request on the employer will be removed. Employers must consult with staff and decide on requests within two months. However, the grounds for refusing a flexible working request will remain unchanged.
Ban on Withholding Tips from Workers (Expected April 2024)
In a move to address pay in the hospitality and service industries, it is expected that a new law will be introduced to ensure employers are not allowed to withhold tips from staff and must ensure they have a written policy on fair tip allocation in place. This will include tips, gratuities and service charges and will require them to be fairly allocated to workers by the end of the month after the month in which they were given by the customer.
Statutory Carer’s Leave (Expected in April 2024)
The UK government is introducing a new law for statutory carer’s leave that will provide eligible employees with an entitlement to this leave from their first day of employment. This leave is for employees caring for dependents with long-term care needs and will allow them to take a minimum of one week of unpaid leave annually. The leave is flexible although it is likely that employees will need to give advance notice. Although employers might not be able to refuse carer’s leave requests, they may be able to postpone them for strong business reasons.
Extended Protection for Pregnant Staff from Redundancy (Expected in April 2024)
Pregnant employees will gain enhanced redundancy rights, similar to those on maternity leave. This will require employers to prioritise pregnant staff for suitable alternative roles, from the announcement of pregnancy until 18 months post-birth. Employers who do not comply will risk claims for sex discrimination, unfair dismissal, and uncapped compensation.
Changes to Statutory Pay Rates (Expected in April 2024):
It is anticipated that the statutory leave and pay rates (for example, shared parental, maternity, adoption, paternity and parental bereavement leave pay) will be increased to £184.03 per week. The proposed new rate for statutory sick pay is £116.75 per week.
Right to Request More Predictable Working Patterns (Expected September 2024)
A new right is being introduced for workers with unstable or unpredictable hours. This right applies to zero-hour workers, agency workers, employees, and those on fixed-term contracts of less than a year. Eligible workers will be able to request more predictable hours after 26 weeks of service. Employers are expected to accommodate requests unless there is a legal reason to refuse. Businesses that rely heavily on the use of a flexible and contingent workforce should start to consider if these requests are likely to be forthcoming from their employees and how they will handle such requests.
Statutory Neonatal Care Leave (Expected in October 2024)
This will provide a new statutory leave for parents or guardians of babies in neonatal care that allows additional time off work on top of maternity and paternity leave, effective from day one of employment. This is to address the issue of parents using up paternity leave during hospitalisation and will give parents the opportunity to spend more time with their baby once out of hospital. Neonatal Care Leave will be for a maximum of 12 weeks and will be paid at the same rate as maternity pay.
Proactive Duty to Prevent Sexual Harassment (Expected October 2024)
The new Worker Protection Act will mandate proactive measures against sexual harassment in the workplace. Employers will be legally accountable for not taking preventive actions, regardless of whether an incident has occurred or not. Failure to demonstrate preventive measures could result in increased compensation claims, potentially heightened by up to 25%. Employers should consider what measures are already in place, if these are sufficient and if none are in place what measures can be taken to ensure compliance in October this year.
What do employers need to do?
With such an overwhelming list of changes it would be easy to think “I’ll address that later”! However, taking proactive steps now will relieve the stress and pressure on your business throughout the year. So here are our top tips on where you should you start:
- Review your policies and procedures:
Assess and update procedures affected by the new laws, including leave, flexible working, and redundancy, ensuring compliance with legal requirements. If you are currently on a retainer contract with Dakota Blue, you will be receiving updates and information from us throughout the year and your consultant will be working with you to ensure you stay compliant. - Update Policies and Handbooks:
Revise any company policies and employee handbooks you already have in place to reflect the new updates and how your business will manage them. - Create New Policies:
If you do not have an existing policy to cover the legal changes, develop new ones detailing the rights, entitlements and reporting procedures for all employees. - Offer Training:
Conduct training for employees and managers on new codes of conduct and processes, focusing on legal compliance in managing leave requests and conduct issues. - Update Software:
Ensure that your existing leave management software can handle new types of leave requests. If you do not currently use any HR Software and are unsure what is best suited for your business needs, speak to one of our consultants who will be happy to provide you with some guidance in the area of HR Software.
Staying ahead of legal changes is crucial for your business's success and compliance. If you're feeling overwhelmed by the 2024 employment law updates, we are here to help. Contact us today for personalised guidance and support in reviewing your procedures, updating policies, and ensuring your business stays on the right side of the law so you can focus on what you do best – running your business.