Employment Edit: 31 January 2025

Neonatal care leave and pay

Last week, the government published regulations confirming that new statutory rights to neonatal care leave and pay will come into force on 6 April 2025. For babies born on or after that date, eligible parents will be entitled to up to 12 weeks’ leave from work if their baby has received neonatal care. Neonatal care leave will be a day one right, but the right to statutory neonatal care pay will depend on the employee meeting certain criteria including having 26 weeks’ continuous service. Crucially any entitlement to neonatal care leave and pay is in addition to other statutory leave entitlements that the parents may have, such as maternity, paternity or adoption leave.

Katherine Flower has written a blog post detailing the new rights and what they mean for parents. In the blog post, Katherine also considers how employers should be preparing for the introduction of the new rights.

Failure to prevent fraud

On 1 September 2025, a new corporate criminal offence of ‘failure to prevent fraud’ will come into force. In short, a large organisation can be guilty of the offence if an ‘associate’ commits a fraud offence intending to benefit that organisation or its clients. The term ‘associate’ includes employees and anyone who performs services for or on behalf of the organisation.

Where a relevant fraud has been committed, an organisation will have a complete defence if it had in place ‘reasonable’ procedures to prevent fraud. The government has published guidance as to what is expected on that front and we are now seeing organisations of all sizes conducting risk assessments, and reviewing and updating their existing compliance procedures ahead of the September implementation date.

Our Corporate Crime & Investigations team has written a blog post explaining this new offence in more detail and picking out some of the steps that organisations should be taking to prepare for its introduction. If you would like to discuss the implications of the new offence and the steps your business might take to mitigate the consequent risks, please contact Guy Bastable, Andrew Matheson or Sam Aldous from our Corporate Crime & Investigations team.

Holiday pay – two-year backstop

In late 2014, after a series of landmark holiday pay cases found that certain additional payments should be included in holiday pay calculations, the government introduced regulations which imposed a two-year backstop on unlawful deduction claims relating to holiday pay (and certain other types of pay). That backstop, which has been in place since January 2015, means that an unlawful deduction claim is limited to two years’ worth of losses dating back from the presentation of the claim.

Earlier this month, an employment tribunal found that the regulations were ‘ultra vires’, meaning that the government did not (in the tribunal’s view) have the required power or authority to introduce the backstop via regulations. Instead, the tribunal said that such a change should have been introduced via an Act of Parliament. As it is a first instance decision, the case is not binding. However, given the importance of the two-year backstop in holiday pay and certain other unlawful deduction claims, it will be important to keep a track of any developments on this point.

(Afshar v Addison Lee Ltd)

Employment Rights Bill latest

The Employment Rights Bill is progressing through Parliament – it has completed the Committee stage in the House of Commons. The government’s proposed amendments to the Bill were all accepted by the Committee, including the proposal to extend the time limit for employment tribunal claims from three to six months. We now await a date for the next step in the Parliamentary process – the Report stage, during which further amendments could be considered.

For more information on the Bill and the wide-ranging reforms that it contains, don’t forget to check out our handbook to the Employment Rights Bill and beyond.