Being an employer is a significant challenge; meeting the day-to-day needs of employees, maintaining premises, getting the job done, turning a profit and keeping on top of all the legal obligations. As the legal landscape is constantly shifting like quicksand, having access to employment law specialists with up-to-date advice is vital to keep on the right side of your obligations.
With that in mind, here is a lowdown of important legal highlights of the year so far. Part II of this blog will cover upcoming legal changes on the horizon.
Data protection and gender pay gap
Anyone who has an email account and has been contacted by anybody who has ever had access to their email address will be aware of the General Data Protection Regulation (GDPR), which came into effect on 25th May 2018. The legislation replaces the 1995 Data Protection Directive and aims to protect individual’s personal information and hold companies accountable for how they handle, use and store personal data. There is also a requirement for businesses with more than 250 employees to show why they have the data in the first place. With the threat of fines of 20 million euros for non-compliance, businesses have worked hard to meet the demands of the new law. Now it is important for employers to make sure they stay compliant and seek legal advice if necessary.
In April 2018, it became a requirement for both private and voluntary sector employers with more than 250 employees (a total which includes workers and self-employed staff) to publish a gender pay gap report under The Equality Act 2010 (Gender Pay Gap Information) Regulations 2017. The report shows six calculations to show how large the pay gap is between the employer’s male and female employees. Compliancy is key because since June the Equality and Human Rights Commission (EHRC) have been contacting employers who have not published their gender pay gap report. Those who do not comply within 28 days of receiving notification will face action, which could include unlimited fines and the possibility of being ‘named and shamed’ with the results of investigations being placed in the public domain.
New tax on employee notice pay
Before 6th April 2018, if an employee was dismissed without notice and had no payment in lieu of notice clause (PILON) in their contract, then an employer could pay the employee a sum, free of tax and National Insurance Contributions, so long as this did not exceed £30,000. This has now changed so employers in this situation will have to deduct tax for ‘post-employment notice pay’. If an employer needs to update their employment contracts they should contact an employment law adviser.
Worker or self-employed?
The fall-out from the Taylor Review of Modern Working Practices is ongoing and recent court cases are highlighting potential pitfalls for employers who assume their freelance staff are ‘self-employed’ when legally they are actually ‘workers’, with entitlement to holiday and sick pay. The recent Supreme Court ruling in the Pimlico Plumbers v Gary Smith case showed that while Mr Smith was not an employee and indeed was registered self-employed to do his tax returns, the courts found that during their working relationship Pimlico was neither his client or customer and so he was a ‘worker’ and not self-employed. If an employer is concerned about the potential status of their staff, then advice is available from our employment law specialists who can judge your situation on an individual basis.
For more on the upcoming events that will affect the employment law landscape in the next few months please read ‘Stay up-to-date, Stay ahead of the game Part II.