Employment law is continually evolving, with recent changes and challenges having a significant impact on businesses. It’s crucial for employers to stay informed and ensure they are up-to-date with the latest developments.

Holiday Pay

The recent Harpur Trust v Brazel case clarified the calculation of holiday pay for irregular workers on permanent contracts. Employers can no longer use the 12.07% method to calculate holiday pay for workers with irregular hours. To calculate holiday pay, employers must consider the work performed by the worker over a 52-week reference period, excluding weeks without pay, and then calculate the average week’s pay. It is advisable to review holiday practices and amend contracts and payroll processes accordingly.

Employment Status

The government has not yet legislated on employment status, but has issued non-statutory guidance. This guidance provides information on the differences between employees, limb (b) workers, and self-employed individuals, including a list of rights for each status. The guidance also covers developments in areas such as gig economy workers, zero-hours workers, freelancers, interns, and employee shareholders.

Fire and Rehire

The government is publishing a Statutory Code of Practice to prevent controversial fire and rehire tactics. The code will be taken into account by tribunals and courts when considering relevant cases, including unfair dismissal. An uplift of up to 25% in employee compensation may be applied if the employer fails to follow the code.

Parents and Carers Rights

The upcoming Neonatal Care (Leave and Pay) Act 2022 will grant parents of hospitalized neonatal babies an additional 12 weeks of paid leave on top of statutory maternity or paternity leave. The Carer’s Leave Bill will also provide carers with up to one week of unpaid leave per year to provide or arrange care for a dependent with a long-term care need.

Menopause Rights

The government has created a menopause taskforce and appointed menopause employment champions to address menopause and employment policies. The recent Rooney v Leicester City Council case marked the first binding decision on menopause discrimination, with the Status Appeal Tribunal ruling that significant menopausal symptoms should be considered a disability under the Equality Act 2010. Employers can support employees by training managers, making reasonable adjustments, and creating a menopause policy.

Reporting Thresholds

The business threshold for gender pay and executive pay ratio reporting has doubled from 250 to 500 employees. The government has decided not to make ethnicity reporting compulsory. The new Modern Slavery Bill requires companies with an annual turnover of £36m or more to publish annual reports on human trafficking and modern slavery, with a single reporting deadline and format. Penalties will be imposed for non-compliance.


New digital right to work checks, using ID validation technology, became available for British and Irish passport holders on April 6, 2022. Employers must either physically check and copy original documentation, appoint an Identity Service Provider, or perform the check themselves using ID validation technology. Non-compliance can result in penalties and fines.

Stay informed and ensure your business stays ahead of the latest employment law changes and challenges by regularly reviewing and updating your policies and procedures.