In the January recruitment rush, it can be difficult to find time to plan for the year ahead - but there are a number of upcoming changes that HR professionals must be prepared for in 2020.
With all of these changes set to come into force in April, you have just a few months to ensure your organisation is ready to meet any new obligations you’re required to adhere to. As this could require changing your processes and adapting your systems, it’s important to understand what you need to do in this time.
Here’s what you need to know, and our top tips on how your organisation can prepare for each change:
Written terms from day one
While you’re currently required to provide anyone you employ for more than a month with a written statement of terms within two months of their start date, from 6th April 2020 all new employees will have the right to this statement from their very first day.
Make sure you’re ready for this change by preparing a written statement detailing all of the main terms of employment for each role during the recruitment process, so you have a document that’s ready to go well in advance of your new employee’s first day.
Equal pay for agency workers
Agency workers are entitled to receive the same pay and basic working conditions as direct employees once they’ve completed 12 weeks’ continuous service in the same role. However, the ‘Swedish derogation’ can exempt them from the right to equal pay if they have a permanent contract with the agency and they’re paid by the agency for periods between jobs. The Swedish derogation is being removed on 6th April.
This means that any agency workers you employ after this date will be entitled to equal pay to your direct employees after they’ve worked for you for the qualifying 12-week period. If you employ a significant number of agency workers at a lower rate than your permanent employees, this could increase your wage bills substantially.
IR35 tax changes
Many contractors provide their services by setting up their own Limited Companies, which means they operate on business-to-business basis, but it’s estimated that up to a third of contractors are currently employed on an almost permanent basis. IR35 currently requires contractors to determine whether they are a true contractor or whether they’re essentially working as an employee, and pay tax accordingly, but from 6th April 2020 medium- and large-sized private sector businesses will take over this responsibility.
If you employ contractors, you’ll need to review those that are supplying their services through limited companies to determine whether the new rules apply to them. The Government’s Check Employment Status for Tax tool can help you to do this.
Holiday pay for irregular hours
Workers that don’t work regular hours can miss out on holiday pay if they take annual leave during a quiet period, as under the current rules holiday pay is calculated based on the hours they have worked in the past 12 weeks. To ensure they receive fair holiday pay, the reference period is increasing from 12 to 52 weeks on 6th April 2020.
This means that if you have workers that work irregular hours, you will have to look back at their average weekly pay over the past year - rather than the past 12 weeks - to calculate what they should be paid for their annual leave.
New right to parental bereavement leave
A new right to parental bereavement leave and pay for employees expected to come into force in April 2020. As it stands, there’s no legal obligation for employers to provide paid time off for grieving parents, but the new law will ensure bereaved parents and carers who have been employed for a continuous period of at least 26 weeks prior to their child’s death are entitled to two weeks’ statutory paid leave. Those that haven’t been employed for 26 weeks will still be entitled to two weeks’ unpaid leave.
Struggling to find the time to prepare for these important changes? An applicant tracking system (ATS) can streamline your recruitment processes, so you spend less time on admin and more time on more important tasks. Speak to our team about how Reach ATS can help your HR team today on 01527 574408.