Coronavirus Job Retention Scheme
The Coronavirus Job Retention Scheme which was due to close at the end of October 2020 has been extended until 30th April 2021. This was welcomed by employers who were able to furlough employees from November 2020 even if they had not previously made use of the scheme. Currently the scheme covers 80% of furloughed employee’s wages (capped at £2,500 per month) until 31st January 2021 at which point the scheme will be reviewed by the government. Employers may be required to contribute a proportion of employees’ wages after 30th April 2021. Employers should consider ways of mitigating any potential redundancies by talking to staff about changing hours of work, implementing job share arrangements, and reviewing salary/benefit packages if agreeing changes such as these may avoid redundancies.
New immigration system
A new points-based immigration system will be in place from the 1st January 2021 marking the end of the Brexit transition period. EEA nationals arriving in the UK from 1st January will need to comply with the same visa requirements as other non-UK nationals. Employers need to understand how the new system will affect their recruitment and should consider whether they will need to apply for a sponsor licence. European nationals already in the UK before the end of the transition period have a grace period until the 30th June 2021 to apply under the settlement scheme
IR35 and the private sector
Reforms to the IR35 rules on off-payroll working in the private sector come into force on the 6th April 2021 having been delayed by a year due to the Coronavirus crisis. Rules are aimed at reducing tax avoidance for contractors employed via personal service companies. Under the new rules the organisation engaging the contractor is responsible for determining their employment status and assessing
whether IR35 applies or not. If it does, the organisation that pays the individual’s fees is deemed to be their employer for tax and national insurance purposes.
Redundancy protection
The government consulted in 2019 on extending redundancy protection (i.e., the right to be offered suitable alternative employment) for employees taking maternity leave. The government committed to extending the period of protection so that it would apply from the point the employee informs their employer that they are pregnant and continue for six months after their return to work. An Employment Bill was announced in the December 2019 Queen’s Speech but as yet there is not a date for these changes to be brought into force.
Other changes
Other employment law developments in 2021 will include:
- Further reforms to exit pay in the public sector
- An increase in the length of time required for continuity of employment to be broken
- Review of rules around tips for workers in the hospitality sector
Claire Cole (Partner/Head of Employment)
For further advice of any of the above changes or any employment-related matters, please contact Claire Cole on 01905 726600 or email Claire.cole@hwhlaw.co.uk
The contents of this article are for purposes of general awareness only. They do not purport to constitute legal or professional advice. Readers should not act on the basis of the information included and should take appropriate professional advice upon their own particular circumstances.