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6 Changes to Employment Legislation that Recruiters Need to Know About

Employment Legislation

Keeping track of employment legislation has always been a challenge, and let’s face it, most recruiters have other things to think about. That’s why it’s so important to partner with compliance experts who can help you anticipate and prepare for upcoming changes. Here are just a few of the changes we can expect in the coming year.

How to Help Your Clients Prepare for IR35 Reform: A Recruiter's Guide. Click here to download>>

Private Sector IR35 Reform

Since April 2017, public sector bodies who engage contractors are responsible for assessing IR35 status, while in the private sector this responsibility still lies with the individual contractor. From April 2020, reform will be extended to include the private sector.

This will mean that all end clients, apart from those who class as small private companies, will be required to assess IR35 status and will be liable if that decision is incorrect.

Urgent action is required by end clients and recruiters to ensure the necessary processes are in place in time.   

Repeal of the Swedish Derogation

Under the Agency Workers Regulations, employment legislation that came into force back in 2011, an agency worker must be paid at least the same as a comparable permanent employee, once they’ve been in the role for 12 weeks.

The Swedish Derogation allows this right to equal pay to be waived in return for pay between assignments. The Swedish Derogation is due to be repealed, which will extend the equal pay requirement to contracts which are currently exempt.

This will mean the issue of “comparator pay rates” must be considered for any contract of more than 12 weeks duration.

Written Statements on Day One

Currently, employees are entitled to receive a written statement of terms within 2 months of starting work. This is due to be extended, so all employees and workers will be entitled to such a written statement on day one of the working relationship. The statement will also have to include enhanced information like:

  • How long the job is expected to last
  • How much notice is required
  • Eligibility for statutory payments like sick pay and maternity/paternity pay
  • Duration and details of any probationary period
  • Renumeration (including, but not limited to, pay)
  • Specific details of days and times of work

Key Facts Documents

In addition, agency workers will need to receive written “key facts” documents, detailing important information about their assignment, including:

  • Who is responsible for their engagement
  • Any element of pay from an intermediary
  • Any fee and relevant benefits

Failure to provide this information will expose an engager to enforcement action by the EAS.

Right to Request a More Stable Contract

In a bid to curtail what the Taylor report called “one sided flexibility”, workers with varying hours and shift patters, including those on zero hours contracts, will be given the right to formally request a more fixed working pattern after 26 weeks of working for the same engager. Presumably the law will insist that such requests are given due consideration, but it isn’t clear what recourse a worker might have if their request is refused.

CIS VAT Reverse charge

To combat so called “missing trader fraud” where fraudsters charge VAT and then disappear without paying it to the Exchequer, the VAT on certain construction services will need to be accounted for by the recipient rather than the supplier (hence the term “reverse charge”). The reverse charge will apply from October 2020.

These are just a few of the up-coming changes to employment legislation in a constantly evolving marketplace. Partnering with compliance experts like Orange Genie Compliance will allow you to stay on top of legislative changes like this, so you’ll always be well informed and prepared. If you have any questions about any of these issues or if we can help in any way, please contact our expert team on 01296 468 483 or email info@orangegenie.com.

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