Following the UK’s exit from the European Union, there has been uncertainty surrounding how employment legislation in the UK would be affected. The government had promised a “bonfire” of EU regulation by the end of 2023 which had raised the prospect of considerable uncertainty. The Retained EU Law (Revocation and Reform) Bill (the Bill) was put before Parliament in 2022 and is intended to revoke retained EU laws. It is currently at Report stage within the House of Lords. However, the effects of the Bill have been drastically changed by the removal of the so-called “sunset clause”.
The sunset clause
As of 15 May 2023, the government has abandoned the sunset clause within the Bill which would have served to automatically repeal any retained EU law by the end of 2023. This position has now been reversed so that EU law will remain binding unless it is expressly repealed. The government will shortly publish a list of the EU-derived laws it intends to revoke from 31 December 2023.
The Retained EU Employment Law consultation
Earlier this month, the government issued a consultation paper in which it specifies the changes being considered in relation to employment law and asks businesses for their thoughts and preferences regarding these proposed changes. The proposals are a lot less drastic than a bonfire but there are some interesting changes which will impact on working time and TUPE.
The consultation was launched in May 2023 and is set to close on 7 July 2023.
The aims of the consultation include reducing bureaucracy, enabling the UK government to replace EU regulations where appropriate with new regulations tailored specifically to UK economic needs, retaining our existing framework of rights and removing regulations that are no longer relevant (e.g. Posted Workers Regulations).
What changes are being proposed?
The main employment changes would affect the Working Time Regulations 1998 (WTR 1998) and the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE 2006).
Changes to record-keeping requirements are being proposed. Specifically, the EU requirement for businesses to implement a system to record the working hours of all employees is set to be scrapped. This is likely to be welcomed by businesses as a way of reducing administrative time.
The government is also proposing to merge the Working Time Directive annual leave of four weeks and the Working Time Regulations additional 1.6 weeks’ leave so workers have one entitlement to leave. This should help businesses as the two types of leave have different rules applying to pay and carry-over depending on the source of the entitlement. The return of rolled-up holiday pay is also under consideration.
Changes to the consultation requirements in the TUPE regulations are being considered which would aim to simplify the transfer process. Specifically, the requirement for small businesses (those with fewer than 50 employees) to hold elections for employee representatives is set to be removed. Further, it is proposed that businesses of any size would not need to hold employee representative elections (and so may consult directly with employees) so long as the proposed transfer is “very small” (meaning fewer than 10 employees are transferring). Again, these changes are likely to be welcomed by businesses.