Employment Law E-Bulletin – Issue 83

• Retained EU Law (Revocation and Reform) Bill 2022/23
• “Slashing Red Tape”
• Changes to Right to Work Checks

It is safe to say there has been some significant turning points this month, and Employment Law has not been immune.

Retained EU Law (Revocation and Reform) Bill 2022/23

On 22 September 2022, the Government introduced the Retained EU Law (Revocation and Reform) Bill 2022-23; this has also been referred to as the “Brexit Freedoms Bill”.

At present, there are over 2,400 pieces of retained EU law; this includes areas we deal with on a daily basis such as the Working Time Regulations. When the Bill goes through (which it undoubtedly will) all EU law will be automatically revoked on 31 December 2023, unless otherwise restated into UK domestic law. The Bill does provide that this date can be extended to 23 June 2026 (at the latest) for complex areas which require more time.

Currently, if there is a conflict between UK and EU law, EU law takes priority. This will stop after 31 December 2023 (or 23 June 2026 if the ability to extend is utilised).

What happens next?

We await the second reading of the Bill. As it stands, the Bill will give UK ministers and devolved authorities significant discretion to restate, revoke or replace certain laws. We may find that these powers are watered down as it progresses through the legislative process.

It is entirely speculative at the moment, but there are some predictions as to what might happen in the sphere of Employment Law once the Bill is enacted:

• Removal of the ban on harmonisation following a TUPE transfer – TUPE is very likely to remain in UK law. However, the ability to re-word EU retained laws may result in the (very welcomed) removal of the ban on altering terms of employment post-transfer. I cannot see collective consultation disappearing and, if suggested, it would be interesting to be a fly on the wall if Unions are told of such change.
• Reverting back to the original UK position on holidays – As it stands, up to 4 weeks holiday can be carried over due to sickness; this could change.
• Introduction of a cap on discrimination claims – Discrimination compensation remains uncapped – this is largely due to constraints from EU law. The introduction of a cap may operate in a similar manner to the unfair dismissal basic award (a week’s pay is capped at £571 and a maximum of 12 weeks’ pay can be awarded.) This may address many employers’ concerns that discrimination legislation has “gone too far,” but would it amount to a step backward in the protections that have been afforded to employees?
• Revocation of the 48 hour working week – largely ignored already, will this remain?
• Agency Worker Regulations 2010 unlikely to be restated – I am sure this would be cause for celebration for many… This would alleviate various administrative burdens and impracticalities for employers who rely on agency workers.

It will be interesting to see what happens if this process is extended into June 2026, given that there will be a general election in the meantime.

A massive change to the legislative landscape, internal turmoil with the current government and a general election… what could go wrong?

“Slashing Red Tape”

Former Prime Minister, Liz Truss, announced that more businesses would be categorised as small businesses, and therefore exempt from certain regulations, such as gender pay gap reporting and executive pay ratios.

Previously, businesses with less than 50 employees were categorised as small. This has now been extended to apply to businesses with less than 500 employees, which is a substantial increase.

This amendment came into force on 3 October 2022 and will apply to all new regulations under development, as well as those under current and future review – including those under review following the Retained EU Law (Revocation and Reform) Bill.

Changes to Right to Work Checks

Right to work checks need to be carried out on all prospective employees, whatever their nationality before employment commences. Employers who have conducted and recorded compliant right to work checks have a statutory excuse which is a defence to a civil penalty.

During Covid-19, adjustments were made to right to work checks which made it permissible to check identification documents digitally, and from 6 April 2022 the ability to check British and Irish nationals’ right to work using Identification Validation Technology.

From 1 October 2022, there are three methods which may be used, depending on the individual’s immigration status and the documents they hold:

1. Online right to work check via the Home Office

This is mandatory for eVisa’s, Biometric Residence Permits, Biometric Residence Cards and Frontier Worker Permits. A manual check of these documents is not compliant. Employers must request a  share code from the prospective employee and use this to check their right to work using the online service. This will tell the employer if they are permitted to carry out the work being offered and whether there is a time limit on their right to work.

2. A digital check using an Identity Service Provider (“IDSP”)

Any individual who does not fall within the scope of an online check, (British and Irish passport holders) employers can carry out checks either manually, or using an IDSP. Either method is acceptable. When using an IDSP, employers will be ultimately responsible for ensuring the IDSP is properly certified and that the checks have been carried out correctly.

3. Manual check

A manual right to work check involves obtaining the individual’s original identification documents and meeting them to check the validity of the documents. Employers should record copies of the qualifying documents and keep a record of the date of the check.

Next steps for employers:

• Employers should ensure that staff who undertake right to work checks are up to speed and understand the new requirements and when each method must be used. This may involve training the employees who hold this responsibility.

• Employers should evaluate their workforce and staff turnover to establish the best process for carrying out right to work checks. For example, using an IDSP may incur a significant cost, but may be the preferred method regardless in conducting checks efficiently.