A new year. Renewed goals and business objectives. And, without forgetting, fresh business challenges and changes to Northern Ireland employment law.
To ensure your business stays compliant, we’ve highlighted eight key employment law issues that could affect your business this year.
- CEO pay ratio reporting
This regulation came into effect in January 2019 and affects companies that employ more than 250 employees. These companies will now have to disclose and justify their CEO’s pay compared to the pay rates of the rest of the workforce.
2020 will be the first year of reporting and will be based on the figures from 2019. This reporting aims to hold large businesses accountable in the case where they award large salaries to their executives.
- Flexible working: Statutory Sick Pay reform
Government consultation in October 2019 introduced the idea that a reform of Statutory Sick Pay (SSP) may be on the cards, which will aim to support flexible working. This flexibility will not only support returns to work, but also aims to keep individuals in work. Currently, employees who are off sick may be battling with the decision to focus on their mental wellbeing or earn money to pay their bills, and so may not explore the idea of a phased return.
With health and wellbeing becoming a focus for more businesses, it’s recognised that change is required. The reformed SSP system will be more flexible than the current system, and will support phased returns to work for employees managing long-term health conditions or currently in recovery from such.
- Use of non-disclosure agreements
There are currently government plans in place for new legislation that will see a change around confidentiality clauses and their use to cover up incidents of bullying and sexual harassment in the workplace. The legislation will aim to remove the ability of employers to prevent employees from reporting illegal and concerning behaviour to the police. This reform was sparked by the #metoo movement whereby women spoke out about sexual harassment by powerful men in the workplace.
Many individuals are currently deterred from reporting incidents due to the clauses contained within their non-disclosure agreements. Furthermore, they’re not fully advised on the terms of these agreements.
- Same-sex marriage employment rights
The legalisation of same-sex marriage recently came into effect in Northern Ireland. Although there is already discrimination protection in place, this update must be considered by businesses to prevent any cases of discrimination. Direct discrimination could occur if someone is treated differently because they are in a same-sex marriage. Likewise, indirect discrimination could occur if an individual is disadvantaged because of workplace rules and procedures.
Employers should ensure they have policies in place that are designed to prevent discrimination on these grounds, with individuals in a same sex marriage being given the same terms and opportunities as those who are not. Areas to focus on include pay, working flexibly, parental leave and adoptive leave.
It seems inevitable now that the UK’s exit from the EU will happen in 2020. But what does Brexit mean for employers?
Brexit will have no effect on many areas of employment law for employees in Northern Ireland, e.g. National Minimum wage, annual leave and maternity/paternity leave will all remain unaffected. The big question that remains surrounds immigration.
If the government reaches a deal, EU nationals will be able to arrive in the UK until December 31st, 2020 and then apply to the EU Settlement Scheme. After this date, it’s thought that an Australian style points-based scheme will apply to EU nationals arriving in the UK and they will have to meet a certain criteria before receiving authorisation to work.
- National Minimum Wage
As announced on December 30th, 2019, the National Minimum Wage rates are set to increase in April 2020. This will apply to all workers in Northern Ireland. Workers who currently earn National Minimum Wage may see an increase of as much 6.5% in their earnings. For those workers aged 25 and over, the minimum pay rate will increase to £8.72 per hour. Any workers aged between 21-24 will also see an improvement of 6.5% from £7.70 per hour to £8.20 per hour.
18-20 year olds are also included – their minimum hourly rate will increase to £6.45 per hour. 16-17 year olds will see an increase of 4.6%, taking their hourly rate to £4.55.
- Increase in discrimination cases
2019 saw a variety of discrimination cases come to light, ranging from pregnancy related discrimination to sexual discrimination. This highlights a need for employers to be more aware when dealing with employee issues and to ensure they’re always acting in a fair and impartial manner when handling sensitive cases.
One case to highlight was a female employee who received £27,917.60 after being dismissed when she was 20 weeks pregnant. The employee was not paid during time off for her antenatal appointments. The organisation then chose to terminate her contract earlier than others, due to the anticipated time off due to pregnancy-related appointments. This is just one example of the cases that occurred in Northern Ireland in 2019, and it highlights the importance of considering any protected characteristics before taking action.
- PSNI holiday pay case
In June 2019, the Court of Appeal upheld a ruling that PSNI staff were owed money due to their holiday pay being miscalculated. Holiday pay was based on basic pay, and did not include any overtime work. The PSNI therefore faced a £40 million payout. The Chief Constable Simon Byrne now intends to challenge the Court of Appeal ruling, and it was found that the case should be heard by the Supreme Court.
There is, however, no guarantee that the petition from the PSNI will be successful, as the Supreme Court will not hear all cases. This is an important case to note for 2020 as for each week of annual leave accrued, workers are entitled to one week’s pay. In Northern Ireland, this one weeks’ pay should be based on an average of the preceding 12 weeks of pay, and not the employee’s basic rate if this is less.
Now that we’ve run through the key employment law issues for 2020, it’s up to you to make sure your business is compliant.
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