THE GOOD WORK PLAN: THE REGULATIONS YOU NEED TO KNOW

Described by the Government as “the biggest package of workplace reforms for over 20 years”, the Good Work Plan was published at the end of last year in response to the independent Taylor Review, which investigated the impact that modern working practices have on today’s workforce.

Since this review, the Employment Rights (Miscellaneous Amendments) Regulations 2019 (“ER(MA)R”), the Agency Workers (Amendment) Regulations 2019 and the Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2019 have been made and will bring into force various proposals set out in the Good Work Plan. Some of these proposals will come into force on 6 April 2020, including changes on financial penalties for employers, section 1 statements for workers, information and consultation thresholds and removal of “Swedish derogation” and the provision of key information documents for agency workers.

FINANCIAL PENALTIES

The ER(MA)R will increase the maximum financial penalty, in respect of an employer’s aggravated breach of workers’ rights from £5,000 to £20,000. This change will apply to breaches that take place on or after 6 April 2020 where an employer has failed to carry out its legal duty, usually relating to deliberate breaches or a repeated series of breaches carried out in a malicious way.

WRITTEN STATEMENT OF PARTICULARS OF EMPLOYMENT

The ER(MA)R will give workers, rather than just employees, the right to a written statement of particulars of employment (a section 1 statement) and the right to bring a claim in the Employment Tribunal if the organisation for who they work fails to provide them with a section 1 statement.

Organisations will be required to provide additional information in the statement, including:

  • Length of time a job is expected to last
  • Notice period
  • Eligibility for sick leave and pay
  • Other rights to leave
  • Probationary period (if any)
  • Pay and benefits
  • Working days and hours

This right will apply to workers who start work for an organisation on or after 6 April 2020 and will become a day-one right, rather than something that is required to be provided within 2 months of the individual’s start date. The change will enable all workers to have the same clarity as employees so they can fully understand what they are signing up to.

INFORMATION & CONSULTATION OF EMPLOYEES

The Information and Consultation of Employees Regulations 2004 provide a framework to encourage long-term information and consultation arrangements between individuals and their employers so their views are considered in respect of workplace issues and reforms. In a bid to make these rights more accessible, the ER(MA)R will lower the percentage required for a valid request to set up information and consultation arrangements from 10% to 2% of employees, subject to the existing minimum of 15 employees.

SWEDISH DEROGATION

Agency workers can currently opt-out of their right to be paid equally to permanent counterparts in return for a contract guaranteeing pay between assignments, known as “Swedish Derogation”. This was originally designed to give reassurance that they would continue to earn even during periods where there were gaps in work.

Following research undertaken by the BEIS, it was revealed that that workers are not benefiting from this opt-out, as pay between assignments does not happen because individuals can be kept on very long-term contracts with an employment business, without their right to equal pay.

The Agency Workers (Amendment) Regulations 2019 will remove the Swedish Derogation and ban its use, which will, after 12 weeks of an assignment, guarantee pay parity with comparable direct recruits for all long-term agency workers.

By no later than 30 April 2020, employment businesses must provide agency workers whose existing contracts contain a Swedish derogation provision with a written statement advising that, with effect from 6 April 2020, those provisions no longer apply.

Agency workers will have the right to bring a claim in the employment tribunal where their employment business fails to provide the above statement.  Agency workers also have the right to not be subjected to a detriment for taking such action, or where an employment business believes or suspects that they have or intend to take such action.

KEY INFORMATION DOCUMENTS

The Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2019 will require employment businesses to provide agency workers with a document setting out certain key information, including:

  • Type of contract they are working under
  • Minimum expected rate of pay
  • How they will be paid and by whom
  • Any deductions of fees
  • Any entitlement to benefits
  • Any entitlement to annual leave and pay and how this might affect their take-home pay

All the above changes will come into force on 6 April 2020, so it is essential that employment businesses make sure they are aware of the new legislation and make any necessary preparations in advance.

In particular, employment businesses will need to liaise with end users to demonstrate that they are committed to complying with the new rules on the abolition of Swedish Derogation and parity of pay between agency workers and comparable permanent employees of end users.

In light of the above, employment businesses will need to carry out a full review of their terms and conditions to ensure that they comply with the new rules.

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