Changes that will affect your business in 2020
As the end of another year approaches, businesses across the country are looking ahead to what 2020 will bring.
And while Brexit uncertainty looks set to continue – at least for now – there are certain legislation changes that we know are set to take place.
As a response to the Taylor Review, which examined the legal rights of employees and workers within the UK, the government published the Good Work Plan in December 2018. The plan proposes a number of reforms to provide workers with greater rights, and although Brexit has caused legislation to be delayed this year, 2020 will see the introduction of some of its key reforms.
Of course, while there is still uncertainty about the final terms under which the UK will leave the EU , it can’t be assumed that these legislative changes will go ahead as planned.
But for the time being, firms must prepare for the implementation of these new laws in order to avoid being caught off-guard.
Here are the key employment law changes we can expect to kick in on April 6 next year.
1) Changes to the tax treatment of off-payroll labour
The original IR35 legislation, which was introduced to counteract the practice of businesses encouraging individual contractors to set up as a personal service company (PSC) in order for the business to avoid taxes, is being replaced with the off-payroll tax (also known as IR35).
From next April, medium and large-sized private sector clients will be responsible for deciding whether the off-payroll tax rules apply. For small businesses, however, the situation will remain the same, with the intermediary taking responsibility.
What you need to do: Review your off-payroll workforce, consider the changes you need to make, and think about seeking legal advice as the penalties for failing to comply are severe.
2) Written particulars becoming a ‘day one’ right
Under the Employment Rights Act 1996, all employees whose employment lasts at least one month or more are entitled to a written statement setting out conditions of employment.
This is known as a statement of written particulars of employment, a section 1 statement, or a statement of terms and, from April 6, 2020, must be provided to both workers and employees on or before the first day of employment, rather than just to employees and within the first two months as is currently required.
There are particulars that may currently be included in a supplementary statement but which will have to, from next April, be given in the principal statement. These include the notice periods for termination by either side and terms relating to absence due to incapacity and sick pay.
Certain terms can also be provided at a later date – as long as this is no later than two months from the start date – within additional documents rather than the principle statement.
What you need to do: Read up on the information that the written particulars should contain. If you need to make any changes to the contract, then employees and workers will need to be informed and revised contracts given. While employers don’t have to give existing employees the additional information as a matter of course, if there is a change to new provisions which were not in the employees’ section one statement, then they would need to be notified of the change.
You should also be prepared for requests to be made for new-style statements by employees and ensure you have capacity to meet their requests no later than one month after the request. Legal advice should be sought when adding in the new particulars in order to avoid costly errors.
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