Upcoming changes to employment and worker contracts – are you ready?
As part of the government’s Good Work Plan, from 6 April 2020, all employers will be required to provide a more comprehensive statement of written particulars, known as a Section 1 statement. The information which must be included in the Section 1 statement, who the information is provided to, and when it is provided, is going to change. It is important that, if you have not already done so, you take steps now to ensure that you are ready for these changes coming into effect. To assist with your preparations, we have set out below summary information on how these changes may affect your business.
You should already be providing employees with a written statement containing certain key information about the terms of their employment and for all individuals employed for over one month, this should be provided within the first two months of employment.
From 6 April 2020, this obligation will also extend to workers, in addition to employees. Furthermore, the information to be included in a Section 1 statement will be more prescriptive, with the following additional particulars being required:
- When the worker is required to work, whether the working hours may be variable and how any variation will be determined;
- Any paid leave to which the worker is entitled;
- Details of any other benefits provided by the employer that are not already included in the statement;
- Any probationary period, including any conditions and its duration; and
- Any training to be provided and details of any mandatory training that the worker must complete, including where the employer will not cover the cost.
You will no longer have two months in which to provide workers or employees with the required information – most of the information must be provided on the first day of employment and, for the most part, in a single document. There will also no longer be a requirement that an individual must be employed for longer than one month in order to be entitled to receive such information. While most of the information must be provided in the principle statement, in respect of some information (including details of notice required, sick pay and other paid leave), the statement can make reference to another reasonably accessible document (for example, a section of law).
While the new information requirements are relatively self-explanatory, some of these will require closer attention and further consideration. For example, details of all benefits must be provided, which means that details of all remuneration (not just pay) are required to be included in the statement. You should conduct a review of the benefits you provide, and consider what details will require inclusion in your Section 1 statement. You should consider the term benefit widely, and be aware that benefits include any contributions in cash or kind. If non-contractual benefits apply, it will be very important to make it clear which benefits are non-contractual, and can therefore be changed or withdrawn. Another key issue for consideration is flexible benefits – already, we have seen different approaches taken in relation to how such information is included in the statement, and the correct approach will largely depend on your specific benefit structure.
You will also have to give further consideration to your work force, in particular in relation to who is considered a worker, to ensure that they also receive the above information in accordance with the new rules and requirements. Identifying worker status is not always a straightforward process, and may include individuals who you had not previously perceived to be workers.
With the changes on the horizon, now is the time to review your Section 1 statements and ensure that they are compliant with the new requirements. The new rules apply for those beginning work on or after 6 April 2020 (albeit in some circumstances the rules can affect existing employees, e.g. where an existing employee requests an updated statement or where an employment particular is updated for an existing employee). We would be more than happy to assist with your preparations, and to help with any queries you have in relation to this.
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