Employment law updates 2017: important changes for employers

The latest UK employment law changes for employers, HR professionals and in-house lawyers.

27 July 2017

Employment law is constantly on the move. We keep track of the latest employment law changes so you don't have to. Below you'll find our regular round-up of legislation, case updates and helpful guides. For a list of key dates for 2017, see our employment law timeline.

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Employment law updates

Update posted 27 July 2017

Employment tribunal fees regime is unlawful, rules Supreme Court

The Supreme Court has today decided that the employment tribunal fees regime, introduced in 2013, is unlawful as it prevents access to justice. The fees regime was also found to be indirectly discriminatory against women.

The Ministry of Justice has issued a statement in response to the decision saying that it “will take immediate steps to stop charging fees in employment tribunals” and will put in place arrangements to refund those who have paid them.

The statement goes on to say that the Ministry of Justice will be considering the detail of the judgment and notes that the Supreme Court did acknowledge that fees paid by litigants, in principle, can be justifiable but that the fee level set in this instance had been too high.

It is interesting that in its recent Review, ‘Good Work – the Taylor Review of Modern Working Practices’ (see our recent briefing) the panel, as an aside, expressed concern about the level of tribunal fees so the court’s decision today aligns with their sentiments.

This leaves us, of course, with a number of unanswered questions, for example:

  • whether a revised regime with lower fees might be introduced
  • how the tribunal system will manage claims in the immediate term as the online claims service will need to be revised
  • whether time limits will be extended to allow those who did not bring claims, because they could not afford the fee, to do so?

We will keep you updated on any developments.

Whistleblowing

International Petroleum Limited v Osipov

Case: The Employment Appeal Tribunal has upheld an employment tribunal decision that two non-executive directors were personally liable, jointly and severally with the company, for the award of compensation to a CEO after he was dismissed by reason of the protected disclosures that he made.

Financial services – extension of senior managers regime

Consultation: The FCA has published a consultation paper on the proposed extension of the Senior Managers & Certification Regime to all firms regulated by the FCA. The regulatory reference regime, currently in force in the banking sector, will also be extended to all FCA firms.

The deadline for a response to the consultation is 3 November 2017, with final rules expected in 2018.

Legal update: Senior Managers Regime FCA extends individual accountability regime




Update posted 19 July 2017

Worker status

The Taylor Review of Modern Working Practices has now been published.

In his Review, Matthew Taylor sets out seven principles for ‘fair and decent work’ and makes a number of key recommendations with potential implications for all businesses whose business models rely on engaging workers and self-employed contractors (and not just those in the gig economy).

The next step will be for the government to consider the extent to which it wants to introduce any of these recommendations into law.

Legal update: Good Work: the Taylor Review of Modern Working Practices

Whistleblowing and the public interest

Chesterton Global Limited v Mohamed Nurmohamed

Case: The Court of Appeal has set out the factors that will be considered when deciding whether a disclosure is in the public interest. The range of factors include:

  • the number of people whose interests the disclosure serves
  • the nature of the interests and extent to which they are affected by the wrongdoing disclosed
  • the nature of the wrongdoing itself and whether it was deliberate or inadvertent
  • and the identity of the wrongdoer (with reference to its size and prominence).

The fact that a disclosure is in the private interests of a worker does not prevent it from also being in the public interest – what matters is whether the worker’s (subjective) belief that the disclosure was in the public interest was reasonable.

Weekly rest periods

Maio Marques da Rosa v Varzim Sol-Turismo, Jogo e Animação

Case: The Advocate General has given an opinion on the timing of the weekly rest period under the Working Time Directive (WTD). In his opinion, the weekly rest period does not have to be taken on the seventh day after six consecutive working days.

The weekly rest period can be given at any time during the period as long as the other requirements of the WTD are satisfied, such as daily rest breaks and maximum weekly working time. If the ECJ follows this opinion, this could mean that an employer would not be in breach of the WTD by granting a weekly rest period at the beginning of one period and at the end of the following period.




Update posted 30 June 2017

Employment changes in the Queen’s Speech

The Queen’s Speech included a number of employment law reforms that the government proposes to introduce over the next two years of Parliament. The key reforms are:

  • The Immigration Bill – this will establish a new national policy on immigration. It will repeal EU law on immigration, primarily free movement, and make the migration of EU nationals and their family members subject to relevant UK law once the UK has left the EU.
  • The Data Protection Bill – this will replace the current Data Protection Act 1998 and implement the EU General Data Protection Directive (GDPR) in order to ensure that the UK has adequate data protection rules in place to allow data to continue to be shared between the UK and EU, and internationally.
  • Worker’s rights – the government states that it wants to ensure employment rules and rights keep up to date to reflect new ways of working. This is likely to be informed by the Taylor Review into Modern Working Practices which is expected very soon.
  • National Living Wage – the National Living Wage will increase to 60% of median earnings by 2020 and then will continue to rise in line with median earnings after that.
  • Gender pay gap and discrimination – the government intends to make more progress in tackling the gender pay gap and reducing all types of discrimination, but no specific measures were announced.

Restrictive covenants

Egon Zehnder Ltd v Mary Caroline Tillman

Case: The High Court has granted an injunction to enforce a non-compete restrictive covenant that was entered into with a junior employee in clear contemplation that she would be promoted to a senior position in the future.

This case is unusual because normally the reasonableness of a restrictive covenant is assessed at the time it is entered into rather than on termination of employment. To ensure enforceability, employers should ensure the restrictive covenant is appropriate for the role for which an individual is employed and enter into a new restriction on promotion.

FCA conduct rules

The FCA policy statement PS17/8 introduces conduct rules which apply to non-executive directors (NEDs) in the banking and insurance sectors from 3 July 2017.

In addition to FCA individual conduct rules this also includes senior manager conduct rule 4 requiring individuals to ‘disclose appropriately any information of which the FCA or PRA would reasonably expect notice’. The other senior manager conduct rules will not apply unless the NED is also a senior manager.

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