This update is the second in a series of two articles reviewing employment law changes over 2016/17. This article explores the key developments for HR managers to look out for in 2017, whilst our first article looks back at the key practical issues arising out of developments in 2016.
The median age of millennials has reached the mid-twenties and their influence in the workplace is starting to be noticed. Inevitably this will increase in 2017 and beyond as more people in this generation start work and progress through the ranks to more senior roles. A number of the key developments in 2017 are important issues for millennials, as they concern the integrity and reputation of organisations, such as equality and diversity, flexibility and making businesses more accountable.
The final draft gender pay reporting regulations have now been published and are subject to parliamentary approval, and guidance is expected early next year. UK employers with at least 250 employees and workers must publish mean and median overall pay and bonuses for each gender. The first deadline for publishing gender pay gap information will be 4 April 2018, but the snapshot must be taken in April 2017 so there are only a few months left to get the house in order.
As the definition of employees in the new gender pay rules has been changed, more organisations than previously thought will be caught by them. Employers should now take legal advice on how best to conduct a mock pay audit to ensure data is covered by legal privilege and so kept confidential. If your organisation has already carried out a mock pay audit, consider the extent to which the changes to the reporting rules will impact on your gender pay gap data and how best to fulfill your reporting obligations
Click here for our latest update on gender pay reporting.
Gender continues to be an issue for boardrooms. Two reports have been published recently on ethnic and gender diversity on boards in the FTSE 250 and 350 companies respectively. It is likely that these employers will need to show they have made genuine attempts to improve diversity at management level.
Although the new data protection rules (set out in the EU General Data Protection Regulation) will not apply until 25 May 2018, some of these obligations are onerous and will take time to prepare for. So you should consider now what new obligations will apply to your organisation and what changes need to be made to comply with these.
Click here for our update on this topic
The apprenticeship levy, which is expected to be introduced in April 2017, will require UK employers with annual wage bills of over £3 million to pay 0.5% of their annual wage bill towards the cost of apprenticeship training. This will replace the current apprenticeship system.
Many employers are unlikely to recoup the levy that they pay, and so they will see this as yet another employment tax. In some cases, thinking more broadly about apprenticeships, and beyond structured training for young starters, will enable organisations to receive some benefit from this levy.
Another levy being introduced in April 2017 is the immigration skills change. Employers that employ migrant workers under tier 2 of the points-based system of immigration will be subject to a levy of £1,000 per certificate of sponsorship per year.
Employment status is likely to continue to be a key issue for many HR teams during 2017, and particularly those in the gig economy. In addition to the expected appeal by Uber against the decision that its drivers are workers, cycle couriers are bringing similar claims to those brought by the Uber drivers, against Addison Lee, CitySprint, eCourier and Excel, and Deliveroo riders are seeking trade union recognition and other workers’ rights.
Employment status is also at the centre of an inquiry launched in October 2016 into the future of the world at work, focussing on the rapidly changing nature of work, and the status and rights of agency workers, the self-employed, and those working in the gig economy, including how these individuals should be categorised for the purposes of tax, benefits and employment law.
The claims by drivers and couriers and any changes arising out of this inquiry will have implications for many businesses, especially those operating in the gig economy, as well as for tens of thousands of workers.
The Government wants business behaviours to be more accountable following the collapse of BHS and the exposure of poor working practices at Sports Direct. In response to these issues, the recently published Green Paper on improving the corporate governance framework focuses on executive pay, strengthening the employee, customer and stakeholder voice in quoted companies and applying corporate governance and reporting standards to large private businesses.
Click here to read our article on this paper.
Flexibility and leave, significant issues for millennials, are likely to be themes running through 2017. The consultation on grandparent leave which was expected this summer has been delayed following the Brexit vote. Look out for this, but given the low take up of Shared Parental Leave so far, this leave may not be introduced anytime soon. The Private Members' Bill on leave for organ donors, which is expected to have its second reading in Parliament in January 2017, guarantees employees who are living organ donors the right to paid time off to allow them to recover.
The government launched a consultation recently on work, health and disability to better understand why disabled people and people with long term health conditions are unable to get or keep a job. Managing employees with long term mental health conditions in particular can be one of the most challenging issues HR managers face.
And finally, the plan is to extend the Senior Manager and Certification Regime, (although not in an identical form) in early 2018 to all persons authorised under the Financial Services and Markets Act, which will include those in asset management, private equity and investment firms. These firms will need to start preparing for the new rules which are expected to be published in 2017, following a consultation.
Click here for our regulatory update
A number of the developments explored here, and Theresa May's promise recently to "protect" jobs and "repair" markets where they do not work, suggest that what has been a relatively benign and stable workplace landscape for employers over the past few years may be starting to change; and with millennials and those who feel they have not had a voice in the workplace speaking up, we may see the beginnings of change in the workplace dynamic too.