Employment Law changes in 2023

On the back of Brexit, a pandemic and a cost-of-living crisis, employers are hoping things start to settle in 2023. Whilst it’s hoped this will be the case, there are also a number of employment law changes which are set to take effect, and proposed changes which are expected to progress, throughout this year. As such, it’s more important than ever to remain up to date with the goings-on in the HR world, to ensure businesses remain compliant and resilient.

Confirmed Changes

New National Minimum Wage rates have been confirmed for April 2023 as follows:

  • 23+ year olds = £10.42
  • 21–22-year-olds = £10.18
  • 18–20-year-olds = £7.49
  • 16–17-year-olds = £5.28
  • Apprentices = £5.28

 The rate of statutory maternity, paternity, adoption, shared parental and parental bereavement pay will increase from £156.66 per week to £172.48 per week.  Similarly, the rate of statutory sick pay will increase from £99.35 per week to £109.40 per week. The lower earnings limit, which employees must meet to be eligible for these payments, is remaining at £123 per week. Since minimum wage rates are increasing but the LEL is staying the same, more people may fall within scope of statutory payments when they didn’t before.

There will be an extra bank holiday to mark the coronation of King Charles III on Monday 8 May 2023. Employers should consider whether they will remain open or close on this day and assess what staffing levels may be needed and/or the process for booking time off. They will also need to review the wording of contracts to determine whether employees are entitled to the additional bank holiday.

Proposed Changes

Several Private Members Bill are making their way through parliament which, once passed, will enhance employees’ entitlements and employers’ obligations. These include introducing statutory neonatal leave and carer’s leave; making it unlawful for employers to withhold tips and service charges from workers; allowing flexible working requests to be submitted from day-one of employment and for employees to make two requests per year; extending protection against redundancy for pregnant employees and new parents; and, implementing minimum service levels for strike action to be lawful in certain industries.

Historically, Private Members Bills did not have much success at changing the law or introducing new laws. However, it seems highly likely that the aforementioned Bills will all come progress this year and come into force at some point over this year and next.

Additionally, the government has recently launched two public consultations with the aim of changing the law relating to holiday entitlement for permanent part-year workers and fire-rehire processes. Its first consultation is seeking responses on proposals to amend the Working Time Regulations to allow holiday entitlement to be pro-rated for part-year and irregular hours workers. If passed, this would see affected workers receive annual leave which is directly proportionate to their working time.

The second consultation hopes to introduce a new statutory code of practice on fire-rehire processes which may make it more difficult to change contractual terms and conditions. Employers who don’t complete a full and fair consultation and dismissal-reengagement process in line with the code could face a compensation uplift of up to 25% for related tribunal claims.

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