Employment Contracts are Changing – Wake Up and Make a Statement
So, it’s 5th April 2020 and you’re just drifting off to sleep having organised your personal taxes for the year when you have that classic anxiety dream… you’re late for school, not dressed and you’ve forgotten that new employment legislation is about to come into effect. We’ve all been there. Once again UK employment law is having a shakeup and workers are due to benefit.
For clarity before we continue, there is a legal difference between ‘employees’ and ‘workers’ which is based around the idea of ‘mutuality of obligation’ – i.e. the employer’s duty to provide work and the employee’s duty to do that work personally. Mutuality of obligation does not exist in a worker relationship (think casual bar staff, who may be offered shifts but don’t have to work them).
Perhaps because of this lack of mutuality of obligation, workers have historically had less employment rights than employees. However, following the recommendations of the 2017 Taylor Review, improved rights have been increasingly afforded to workers, narrowing the need to distinguish between the two. For example, you may remember waking on 6th April this year to the dawning of itemized payslip entitlements being extended to workers. 6th April 2020 promises to bring greater convergence by expanding the right to receive a section 1 statement to workers.
Section 1 statements are the written statement of employment terms employers are required to provide their employees under section 1 of the Employment Rights Act 1996. Currently Section 1 statements must include:
- Names of employer and employee;
- Job title/description, hours required and the place(s) of work
- Date on which employment began and, if for a fixed term, when it will end.
- Pay including means of calculating the pay where appropriate and payment intervals
- Entitlement and payment calculations for holiday and sick leave
- Pension details
- Termination notice obligations on the employer and employer
- Any collective agreements which affect the terms and conditions of employment
- Details of a person to refer disciplinary concerns or grievances to.
As it stands the requirement to set these details out only extends to employees who are employed for over one month and employers have two months to comply. However, from 6th April 2020 both employees and workers will be entitled to receive these as a day one right. Employers will not be obliged to provide existing employees or workers with updated statements, however, employees and workers will have a one-off right to request this. It may therefore be best practice to ensure compliance in advance.
From April 2020, section 1 statements will need to detail entitlement to all paid leave as well as any remuneration or benefits besides basic pay. Additionally, they will need to feature probation period policies, training requirements and associated funding policies, and more specific weekly work schedule provisions. Pension details, disciplinary and grievance procedures, training information and particulars of paid leave other than sick pay may be provided in a form supplementary to the section 1 statement no later than two months from an employee or worker’s commencement date.
For a peaceful night’s sleep, employers should review their contracts and/or section 1 statements and consider if any further details might be required under the new rules. It is also worth determining where the company engages workers and ensuring they receive the correct information going forward. For assistance with this you’re welcome to contact our employment dream team.
Claire Knowles - Partner
Mark Alaszewski - Associate
Rebecca Mahon - Solicitor
Amelia Wheatstone - Solicitor
Adam McGlynn - Trainee Solicitor
