Employment Law: What's in Store for 2015?

Simon Rice-Birchall, a partner at law firm Eversheds, shares his employment law predictions for 2015.

Notable Themes of 2014

Despite their significant ongoing impact, employment tribunal fees remain in force after the High Court rejected Unison’s claim that the fees regime is unlawful. However, the longer-term future of these fees is not secure; Unison may well appeal to the Court of Appeal. Both the Labour Party and Liberal Democrats have indicated they would reduce fees, and plans to devolve power over the tribunal system in Scotland could trigger a comprehensive review of how the system will operate in England and Wales.

Recent rulings from the Court of Justice and the Employment Appeal Tribunal suggest many employers have been underpaying elements of holiday pay for the past 15 years. Employers should urgently review holiday pay arrangements to assess potential liabilities, including the risk of back‐pay claims, and consider implementing changes now.

What’s in Store for 2015?

From 5 April 2015…

Shared parental leave will be available to parents of children due to be born or placed for adoption. The two weeks’ compulsory maternity leave is retained, but eligible parents will be able to share some or all of the remaining maternity (or adoption) leave and pay, replacing additional paternity leave. The new regime is enlightened but complex, and enhanced pay practices pose a dilemma for employers.

Adopters will also be entitled to time off for pre‐adoption meetings; adoption leave becomes a day-one right with no qualifying service; and adoption pay is enhanced to 90% of pay for the first six weeks. Parents fostering a child under the “Fostering to Adopt” scheme will be eligible for adoption leave (and shared parental leave), as will eligible surrogate parents.

The period within which ‘ordinary’ unpaid parental leave can be taken will extend to the child’s 18th birthday, rather than the 5th birthday. Employers must update policies to reflect these changed entitlements.

Changes to pensions legislation will give individuals greater flexibility in accessing their pension savings. Employers need to understand these changes and consider updating plan designs to accommodate new options. Default funds under defined contribution plans should be reviewed for suitability, and a communication strategy must inform members of the changes.

Early 2015…

The new Fit for Work service will be phased in, placing greater responsibility on employers to encourage a return to work. This service will independently assess employees’ ability to work and recommend steps to help them stay in or return to work. Employers should review procedures to ensure they reflect the new practice and consider the impact on any in-house occupational health resources.

What Else Might Be in Store for 2015?

The government faces pressure to complete its employment reforms before the next election. Key measures include:

• The Small Business, Enterprise and Employment Bill, impacting zero-hours contracts and public sector exit payments.
• The employment status review, which could extend employment rights to all workers.
• The Modern Slavery Bill, which will require employers to monitor their supply chains if passed.

All three main political parties promise reforms to zero-hours contracts and extensions to employment rights. Both Labour and the Liberal Democrats also propose improving pay transparency, incentivising the living wage, and enhancing enforcement of employment rights such as the minimum wage. Significant differences remain regarding the UK’s relationship with the European Union and the European Convention on Human Rights.

With employment law and politics closely intertwined, the upcoming general election is set to be a pivotal moment for employers and employees alike.

Read More:

• Employment Law Guide for Employers 2016
• Employment Law Review 2014