There are some important changes to statutory rates of pay that the Government have already announced, to take effect in 2024.
National Minimum/Living Wage Rate Increases & Accommodation Rate
The National Living Wage is to rise by 10% which is the biggest cash increase ever. This will also now apply to all workers aged 21 and over for the first time (previously applying only to those aged 23 and over). It will go from £10.42 to £11.44 per hour.
At the same time, the National Minimum Wage (NMW) rates will be increased as follows:
- from £7.49 to £8.60 per hour for 18 to 20-year olds;
- from £5.28 to £6.40 per hour for 16 & 17-year olds; and
- from £5.28 to £6.40 per hour for apprentices;
Accommodation Rate
If you provide some form of staff housing as part of the contractual arrangements, then the daily accommodation offset will apply. This will change from the current rate of £9.10 per day to £9.99.
The effect of accommodation rates on the National Minimum Wage or National Living Wage depends on how much an employer actually charges for accommodation. It’s calculated by ‘pay period’, the frequency interval that someone is being paid. If the accommodation is free, it still affects the minimum wage. It does not matter if the cost of the accommodation is taken from the worker’s wages beforehand, or if the worker pays the cost after they get their wages.
Increased Statutory Rates
The rate for 2024/25 for Statutory Maternity (SMP), Paternity (SPP), Adoption (SAP), Parental Bereavement (SPBP) and Shared Parental (SShPP) Pay are set to increase from £172.48 to £184.03 per week.
Additionally, the rate of Statutory Sick Pay (SSP) is also set to increase from £109.40 to £116.75 per week.
The rates for Statutory Redundancy Pay, Statutory Guarantee Pay, and Tribunal Awards are not yet announced. We will send an update as soon as the new rates are published. They are usually expected in March.
Implementation
Exact dates of implementation are still to be confirmed, and it is worth noting that they do not all usually increase on the same date. It is expected that SSP will increase on 6th April 2024, with SMP, SPP etc. increasing on 8th April 2024 at the start of the new tax year. The NLW and NMW rates go up from 1st April 2024.
January Changes to Existing Rights
A number of substantive provisions of the Retained EU Law (Revocation and Reform) Act 2023 (known as REULA) have now become law, changing the status of various aspects of retained EU law under the European Union (Withdrawal) Act 2018, or for short, EU(W)A.
S.4 EU(W)A, that directly preserved rights arising under EU Treaties and Directives, has now been repealed, although it is important to note that there are some transitional provisions which preserve its effect in relation to facts occurring before the end of 2023. This means that claims relying on directly effective rights preserved under S.4 EU(W)A can still be brought so long as they rely on events or actions taking place before the end of 2023. Such claims can still invoke the general principles of EU law and the supremacy of EU law to the same extent as was possible under the EU(W)A as originally enacted.
S.5 REULA, which renames ‘retained EU law’ as ‘assimilated law’, is also now fully in force. However, not all of REULA has yet to come into effect, such as s.6 REULA, which will give Courts greater discretion to depart from retained EU case law.
The Equality Act 2010 (Amendments) Regulations 2023 also came into force on 1st January 2024, which include extended protection from pregnancy and maternity discrimination, the right to claim indirect discrimination by association, the ‘single source’ test for establishing an equal pay comparison, and a definition of disability that considers a person’s ability to participate in working life on an equal basis with other workers.
The Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023 amend the Working Time Regulations 1998 to preserve the entitlement under EU law to be paid ‘normal remuneration’ during annual leave, also came into force on 1st January 2024. Normal remuneration, in a nutshell, means that if people receive on almost every pay interval additional earnings beyond basic pay, such as overtime, shift premium, commission or bonuses, then this will be deemed normal remuneration for the purposes of calculating holiday pay. This is also known as average holiday pay, based on the previous 52 weeks earnings. This is actually not really new, as English case law has established this for some time, but the Government has now formally enshrined it into Statute.
Future Legal Rights
A number of Bills giving new rights are on their way to becoming enforceable regulations. However, due to the nature of the legal parliamentary process, it is not possible to say with certainty when this will happen this year, or what the details of these new rights will be, as they may still be changed. Nevertheless, it is important to be aware of what might be coming.
Protection from Redundancy (Pregnancy and Family Leave) Act 2023
Currently, employees absent from work on maternity, adoption or shared parental leave have the right to be offered any suitable alternative employment before their colleagues during a redundancy process. This is what is known as a “protected period”. With new secondary law coming into place this year we now know that for leave that ends on or after 6th April 2024, this protected period will be extended.
Pregnancy and Maternity Leave
From the time the employee discloses the pregnancy, a protected period applies. This will end on the day statutory maternity leave starts, and a further protection period is applied for a period of 18 months after the expected week of childbirth (or 18 months after the exact date of childbirth, if the employee has notified their employer of the day childbirth occurred before the end of the statutory maternity period). Where the employee is not entitled to maternity leave, such as in the case of a miscarriage, the protection period ends two weeks after the pregnancy ended.
Shared Parental Leave
The protected period begins from when the child is born or placed with the employee for adoption, and will be extended to 18 months after. To be eligible for the extended protection period, the employee must have taken six or more consecutive weeks of shared parental leave. They also must not have taken maternity or adoption leave.
Where less than six consecutive weeks of leave is taken, the protected period will continue as is currently the case, i.e. during the leave only.
Adoption Leave
The protected period runs from when the child is placed for adoption with the employee and is extended to 18 months after that.
Employment Relations (Flexible Working) Act 2023
We are waiting on ACAS to finalise its updated Code of Practice on handling requests for flexible working. Additional ACAS guidance on flexible working is also expected to be updated.
Secondary legislation will be implemented to set out the first of five changes that need to be put down in regulation to implement the 2023 Act.
The first regulation confirms that for any requests made on or after 6th April 2024, the employee making the request does not need to have any service with the employer. Essentially, this means the right to request flexible working will become a day one right. Currently absent are the other four proposed changes to flexible working rules. When they come, which is likely to be from 6th April 2024, they will be:
- reduction of current reasonable timeline to deal with requests from three months to two months;
- removal of requirement for employee to set out the impact of their requested arrangements;
- introduction of the requirement for employers to consult with an employee before refusing a request;
- increase in the number of statutory requests permitted per 12 months from one to two. Interestingly, the right to appeal an unsuccessful flexible working request appears to have been removed.
Carer’s Leave Regulations 2024
This introduces a new right to one week’s unpaid time off in any 12-month period to provide or arrange care for a dependant with a long-term care need.
This Regulation is still subject to parliamentary approval, which is thought will be passed and if so, this will come into force on 6th April 2024.
These Regulations provide that from the first day of employment, employees with a dependant with a long-term care need that need to take time off to care, or arrange it, for that dependant are able to do so, subject to a maximum of one week per year.
Unlike other forms of family leave, which must be taken in blocks, such as paternity or parental leave (unless the child is disabled), carers can take this leave either consecutively or separately in half or full days. In order to take the leave, they are required give written notice, which under the Regulations will need to be either twice the length of the time being requested, or three days, whichever is the longest.
Similar to parental leave, employers will be able to postpone a request for carer’s leave if at the time it would unduly disrupt operations. If declining the request, the employer must give a written explanation as to why this postponement is necessary. Nevertheless, the employee will need to be allowed to take the leave within one month of the original start date of the leave, following consultation with the employee as to a more convenient date.
This is likely to be a busy year for employment law changes, and we will be updating client Handbooks once we have a clear understanding of what these changes will mean in practice.
Clients are welcome to raise any concerns with our Consultant Team, who would be pleased to advise you on any element of the issues arising from this newsletter.
