Annual HR Update 2019 Final

Catherine Kane Associates April 2019

Annual HR Update

The essential guide for employers

Microchipping

Current and Due 2019 Planning for 2020 Onwards

The "Good Work Plan" Agency Workers
Immigration Taxation on Termination
PayGap Reporting Improving Holiday Pay
Parental Leave Transparency on Parental Leave
IR35 Brexit Continuity Planning
Auto-enrolment increases Auto-enrolment for 18 year olds

©2019 CATHERINE KANE ASSOCIATES  WWW.CATHERINEKANEASSOCIATES.CO.UK

2019 Annual HR Update 02

CONTENT HIGHLIGHTS
Current
NEW

Extending PayGap Reporting to SMEs Online Forum
Taxation on Pay in lieu of notice (Pilons) Discussion
Whistleblowing

The "Good Work Plan" Consultations Microchipping employees
Enquiry into sex discrimination

Non Disclosure Agreement - Gagging clauses

Immigration White Paper

Extending discrimination protection period after

maternity The Supplement

Due Immininently Robin Hood

Statutory Wage increases Tribunal Watch
Auto enrolment increases
Five Big Ones

2020 Onwards Handy Hints

Agency Workers Regulations COST SAVING TIPS
Improved holiday pay
NIC on taxation payments 5 Most Common HR related
Extend IR35 to private sector Payroll Mistakes
Tipping

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2019 Annual HR Update  03

Review

Following devolution in 1998, employment and The most significant developments over the past 12

discrimination policies devolved to the Northern months concern Brexit, GDPR and The "Good Work

Ireland Assembly although some legislation such Plan" recommendations which aim to address issues

as the Data Protection Act and part of TUPE in today's economy with the modern workforce.

regulations apply to the whole of the UK.  

Whilst this year and future years there are a

At the time of writing there continues to be a multitude of changes on the horizon with the 'Good

period whereby the Local Assembly is inactive and Work Plan', employers will want to start thinking

there are a number of employment legislation practically about how it will impact them.

initiatives in abeyance, therefore I believe this is

building a backlog of changes, that if not planned Additionally, HMRC continue to look out for ways to

for will create a disruptive volume of work as they test whether IR35 contractors should be considered as

eventually pass into NI law. I think it is worth employees. A recent case with Lorraine Kelly caught

considering action in advance. I have highlighted the headlines (March 2019). This is part of an overall

throughout the review. The main outstanding strategy by HMRC to try and treat contractors as

piece of legislation is the Employment Act employees. More test cases will define the law in this

(Northern Ireland) 2016, which will, it is felt, bring regard.

Northern Ireland into some sync with GB, but this

does not cover changes for the past 2 - 3 years. A great deal of emphasis is also being placed on

discrimination in the workplace (it is likely that there

In the meantime, this year’s Annual HR Legislative will be a direct-rule method to extent these

Update contains developments with the Central provisions to NI), I recommend it is worth

Government that will provide you with insight into considering taking action in advance and I have

the changing world of employment legislation. highlighted that through the review,

It is our intention that this insight will help you

prepare your business for the future changes Please use this review as a reference during the year

affecting your employees, payroll and and give me a call with any queries.

organisational policies.

Catherine

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2019 Annual HR Update  04

Current

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2019 Annual HR Update  05

Current Contents

PayGap Reporting Extending gender PayGap reporting to SMEs

"Good Work Plan" Consultations Transparency in the labour market
Agency Workers
Employment Status
Enforcing Employment Rights

Tax and Finance Taxation on PILONS and termination payments
Data Protection Consultation on NWM and salary sacrifice
Discrimination Abolition of childcare vouchers scheme
IR35 Private sector consultation closes
Brexit
GDPR Act
EU whistleblowing directive

Caste religious discrimination legislative
Enquiry into sex discrimination
Extending discrimination during pregnancy and maternity
"Happy to Talk Flexible Woring"
Non-disclosure agreements - Gagging Clauses

Restricting employment allowance for illegal working
Immigration White Paper
Workplace rights in a no-deal Brexit

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2019 Annual HR Update - Current  06

PayGap Reporting

In Northern Ireland, the Employment Act (NI) 2016, which provides for the making of
the gender pay reporting regulations, is yet to be progressed due to the lack of a
functioning executive. The Equality Commission recommends that businesses address
any issues now as a matter of good practice. So it our recommendation that we at least
consider if there are issues within our payroll by conducting an audit in the next 2 -3
months.

UK Gender Pay Gap Report 2018

Source: Mc Kinsey 2018 analysis

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2019 Annual HR Update - Current 07

PayGap Reporting

Extending PayGap Reporting to SMEs

Private and voluntary sector employers in England, Wales and
Scotland with at least 250 employees are required to publish
information about the differences in pay between men and women in
their workforce, based on a pay bill ‘snapshot’ date of 5 April 2017.
and to report annually on the pay gap between their chief executive
and their average UK worker, from 2020 onwards. It has been
recommended that gender pay gap reporting should be extended to
companies with 50 or more employees from 2020.

This legislation is in backlog - however it is likely that when it comes
to Northern Ireland, it is possible it will apply to a greater percentage
of employees in one hit. So employers this means a significant
number of businesses will be reporting at the same time. Klaxon call -
prepare an audit now, put in place a plan to address any issues and be
ready for when it arrives. If it is worth the effort, as any past/ current
pay gaps need justification - in case they could be viewed as
discriminatory in the GB context.

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2019 Annual HR Update - Current 08

Statutory Sick Pay can be justifiably with-
held if an employee does not follow the
correct notification procedures for their

absence.

HANDY HINTS

HR related Payroll Mistakes

Mistakes that cost you money - either through overpayment and
not being able to recoup or underpayment and being charged
with unlawful deduction of wages at a Tribunal. So if your SSP
policy is too generous or you've overpaid in error the business
accepts that loss (unless you have an express term in your
contracts).

2019 Annual HR Update - Current 09

The "Good Work Plan"

Consultations

Matthew Taylor’s report for the Government was published on 11 July 2017. The Central
Government accepted all but two of Taylor’s 53 recommendations, and was published in
February 2018. It was accompanied by four Government consultations on how best to bring
about the suggested reforms. The roll-out of the outcome of the four consultations
commences in April 2019. A summary of the four consultations are detailed below.

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2019 Annual HR Update - Current  10

The "Good Work Plan"

1. Transparency in the labour market 3. Employment Status

There is a need for greater clarity over The Taylor report suggested renaming
employment rights recommended by the those eligible for worker (rather than
Taylor report and this consultation looked at employee) rights as ‘dependent
whether employers should provide enhanced contractors’ and providing this category
written statements of employment particulars of worker with additional employment
to all workers, not just employees. protections, including the right to a
written statement of particulars,
The consultation also considered including minimum pay rights, and the right to
changing the rules on breaks in continuous rolled-up holiday pay.
service to make it easier for casual workers to
claim redundancy payments or unfair The report also recommended enhancing
dismissal compensation. self-employed rights to include pension
provision and parental leave.
This consultation also looked at extending the
holiday pay reference period for zero hours 4. Enforcing Employment Rights
workers from 12 to 52 weeks. Seasonal and
zero hour workers in particular will benefit The consultation sought to gather
from this proposed change - as they will see further information about the extent of
an uplift in their holiday entitlement. non-compliance with rights and
entitlements, including holiday pay and
2. Agency Workers Statutory Sick Pay. There was also clear
support in the responses for some form
Improving pay information for agency of state enforcement of holiday pay for
workers, and giving them the right to request the most vulnerable workers.
a direct contract of employment when
placed with the same hirer for 12 months. The consultation sought views on how
Government should implement a
The consultation also looked at improving naming and shaming scheme for those
the monitoring of umbrella companies and employers who do not pay employment
other intermediary companies in the supply tribunal awards within a reasonable time.
of agency workers and the ‘Swedish The consultation sought views on the use
Derogation’, which allows UK agency of additional and financial penalties,
workers to opt out of entitlements to equal including aggravated breach penalties.
pay with permanent staff. So if you engage
with recruitment agencies for instance, be
mindful of the terms of your agreement with
regards to your tax responsibilities as the
employer or the end-client.

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2019 Annual HR Update - Current  11

Don't forget that employees on
part-time or variable (zero) hour

contracts are entitled to a
minimum of 28 days paid
holiday (pro rata) per year.

HANDY HINTS

HR related Payroll Mistakes

Mistakes that cost you money - A common problem is calculating
holiday entitlement in days, this could lead to a discrimination
claim by part-time workers. We recommend you calculate
holiday in hours for all employees - as it makes it more
transparent. Speak to Catherine if needed.

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2019 Annual HR Update - Current 12

Tax and Finance

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2019 Annual HR Update - Current 13

Tax and Finance

Taxation on PILONs and Termination Payments

By introducing these changes, the government aims to:·        

Treat all Payments In Lieu Of Notice (PILONs)
as earnings (subject to tax and class 1 NICs).
Effectively, employers will be required to make
payments subject to tax an amount equivalent
to the employee's basic pay if notice is not
worked. This change took effect from 6 April
2018. Make sure that it's clear to leavers that
payments in lieu of notice are taxable. I've had
one example of a new client this year who has
previously fallen foul of PILON's and it cost the
business £8k.
Subject all termination payments above the
£30,000 threshold to class 1A NICs (employer
liability only). This will require new legislation.
The change was due to take effect from 6th
April 2018, but has been postponed to 6 April
2020.

Consultation on National Minimum Wage and Salary Sacrifice

A consultation launched on whether the NMW rules need to be updated to better fit
modern working practices, and whether the rules are unfairly penalising employers
operating Salary Sacrifice Schemes (SSS) for company benefits. 

Some employers have already decided to withdraw SSS that provide tax benefits for both
employee and employer in order to avoid non-compliance of the NMW.
The consultation closed on 1st March 2019.

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2019 Annual HR Update - Current 14

Tax and Finance Cont'd

. Abolition of Childcare
Vouchers
IR35 Private Sector Consultation
The workplace childcare
voucher system, and the directly
contracted childcare scheme
(childcare provided by the
employer), were closed to new
entrants from 4 October 2018.
So make sure employee
contracts/ handbooks don't
refer to Childcare Vouchers.

The employer-backed vouchers
are replaced by a new system of
tax-free childcare, entitling
families to claim up to £2,000
per child.

The IR35 rules, introduced in 2000, are aimed at reducing tax avoidance for people working
off-payroll, through personal service companies (PSCs).

HMRC estimates that only 10 per cent of the PSCs that should be applying the rules actually
do so. To address this, the government switched responsibility for deciding whether IR35
applied from contractors to end-users (agencies or businesses) in April 2017, but only for PSCs
operating in the public sector. A consultation opened which proposed making private sector
employers responsible for accounting for tax and employer NI contributions for workers
engaged through intermediaries. The consultation closed on 10 August 2018.

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2019 Annual HR Update - Current 15

A new employee to your organisation could
be eligible for SSP if they have only 5 days
service and have been absent with sickness

for 4 of those days.

HANDY HINTS

HR related Payroll Mistakes

Mistakes that cost you money - Remember that an employee may
not qualify for SSP if they have sickness absence in their first 3
days (includes non-working days) in a 'linked' period of 8 weeks.
After that they may qualify for 28 weeks SSP.

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2019 Annual HR Update - Current 16

Data Protection

In cases of areas such as protection of privacy and personal data, the
whistleblowing rules may become a powerful tool to ensure compliance with the

stringent new legislation, the General Data Protection Regulation (GDPR).

GDPR Act EU Whistleblowing Directive

The GDPR applies to all EU Member The EU on 12 March 2019 passed a law that

States, including the UK, from 25 May 2018 protects European whistleblowers who report

(and through the transition period after breaches of EU law, including fraud, tax

Brexit). evasion or data breaches.

The EU Commission proposed a

The GDPR strengthens existing data "whistleblower protection directive" in April

protection rules through a number of 2018, citing scandals like Dieselgate, the

measures, including an expansion of Panama Papers or the Cambridge Analytica

individual data protection rights, data breach, which were uncovered by

including:- whistleblowers.

- the right to be forgotten

- toughening the rules on individual Legal issues involving whistleblowers in the

consent to processing sensitive data EU are currently handled through the judicial

- shortening the time scale for responding system of individual countries. By creating

to ‘subject access requests’ from 40 days to an EU-wide standard the Commission said

one month, and that "safe channels for reporting both within

- removing the £10 fee requiring organizations and to public authorities" will

organisations to report any data breaches be established.

which ‘risk the rights and freedoms of the

individual’ to the regulatory authority and, Although the new legislation, adopted by the

where there’s a high risk of this, to the EU, would only come into force after March

individual affected as well. 2019, the standards may underpin any post-

So if you haven't already, register your Brexit EU-UK future relationship deals and

business with the ICO, complete an audit the UK will likely mirror EU law.

of your existing files and methods of

storing and gathering sensitive data, so as

to start putting a plan in place.

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2019 Annual HR Update  17

Discrimination

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2019 Annual HR Update - Current 18

Harassment & Discrimination

The issue is what can be done, by both the Government and employers to protect
against what seems to be the ever growing issue of discrimination and harassment in
the workplace. The #MeToo movement has been critical in bringing harassment to
the forefront of discussions across the social spectrum. The following articles
demonstrate the governments efforts to promote a more open and transparent
working environment in which victims of harassment and discrimination feel
comfortable enough to come forward and report their experience.

Caste Religious Discrimination

In a response to a consultation that took place in 2017, the Central Government has
decided not to go ahead with an option to add caste to the definition of race as a
‘protected characteristic’ under the Equality Act 2010. The government has instead
decided to rely on existing case law to reinforce its position that caste discrimination is
unacceptable, following an Employment Appeal Tribunal decision in the case Tirkey v
Chandhok (2015).

The case is binding on tribunals, and the government has said it will support a case on
caste in a higher court, if appropriate.

Enquiry in to Sex Discrimination

The House of Commons Women and Equalities Committee is collecting evidence on how
well the Equality Act 2010 is working.

The committee has already made a number of recommendations, following enquiries
into pregnancy and maternity, transgender and older worker discrimination, workplace
sexual harassment, and so there's likely to be an NI equivalent.
These include:
- extending time limits for pregnancy/maternity and sexual harassment claims
- increasing the use of the EHRC’s enforcement powers
- increasing regulators’ involvement in tackling discrimination in regulated organisations.

The Equality Act 2010 does not apply in Northern Ireland. The main anti-discrimination
law in NI is the DDA (Disability Discriination Act 1995). So there is likely to be a cross over
with the this legislation and the DDA once the Assembley have time to review.

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2019 Annual HR Update - Current 19

Harassment & Discrimination Cont'd

Extending Discrimination
during pregnancy and maternity

The proposals build on evidence of discrimination against
pregnant women and new parents from the Taylor report
and a number of other consultations.
The proposals include extending the protected period’ to
six months after the new mother returns to work –
currently the special protections against redundancy finish
when maternity leave ends, or two weeks after pregnancy
ends for women not entitled to maternity leave. Giving
parents returning from adoption or shared parental leave

‘.
the same rights is also proposed.
The consultation closes on 5 April 2019, so the outcome of
this consultation is very shortly, it would be wise to review
your current maternity policy with a view to make
amendments inline with the above proposed changes..

#Happy to Talk Flexible Working"

In January 2019 the Central Government commenced a campaign called "Happy to Talk
Flexible Working" which introduces another duty for employers to consider whether a job
can be done flexibly, and make that clear when advertising.

Working flexibly (e.g. later start times, working from home, part-time hours etc.. ) help
people to balance their work and home lives and is seen to be vital in creating an inclusive
economy where those with caring responsibilities can continue working. It also gives
employers access to a wider pool of talent and enables better matching of applicants and
jobs.
I have noticed large multi-national organisations already using the slogan in their
recruitment activities and we advise you, at this stage, to at least consider whether a
position can be managed flexibly. If you need further information on an objective way to
reach this decision and its impact on your operation, please get in touch.

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2019 Annual HR Update - Current 20

Harassment & Discrimination Cont'd

Non-Disclosure Agreement - Gagging Clauses

The Parliamentary Women and Equalities Committee has launched an
enquiry into the use of Non-Disclosure Agreements (NDAs) in cases involving
any form of harassment or other discrimination, including pregnancy or
maternity discrimination, or racist abuse.

The committee has already recommended a review of how NDAs are being
used in sexual harassment cases.

Written evidence is requested on a number of issues, including whether
NDAs (sometimes referred to as ‘gagging clauses’) should be banned, or
safeguards introduced to prevent misuse, and whether organisations
should be required to disclose the number and types of NDAs they enter
into.

The enquiry closed on 28 November 2018 with a response expected 29
April 2019. So if you are using confidentiality clauses within your contracts
and settlement agreements with exiting employees, ensure that they
comply with the new legislation, which includes that the employee
receives independent legal advice (which ensures they are in possession of
all the relevant facts), this will help mitigate against potential claims.

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2019 Annual HR Update - Current 21

Each employee's holiday pay is
calculated using the average of
the previous 12 weeks earnings

HANDY HINTS

HR related Payroll Mistakes

Mistakes that cost you money - remember to include regular
overtime and regular commission payments in the holiday pay
calculations... just so you know - this 12 week reference period is

increasing to 52 weeks in 2020.

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2019 Annual HR Update - Current 22

Brexit

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2019 Annual HR Update - Current 23

Brexit

Restricting Employment
Allowance for Illegal
Workers

The Central Government has
introduced a deterrent to
employing workers without the
right to work in the UK.

From April 2018, employers that
have received a fine for hiring
workers illegally, and exhausted
the process for appealing against
the penalty, will be unable to
claim Employment Allowance
(which reduces their NI
contributions) for one year
afterwards.

Immigration White Paper

The proposals for a new skills-based immigration system, that will apply both to EU migrants
and those from elsewhere, follow the recommendations of the Migration Advisory
Committee and include:
- removing the annual cap on the number of work visas that can be issued
- widening the skills threshold to include migrants with A-level equivalent qualifications
- ending the labour market test for employers wishing to sponsor a worker.

The government is to consult on what would be an appropriate salary threshold (currently
£30,000 a year) for the skilled migrant route, which isn't helpful in a Northern Ireland
context.
There is also to be a new 12-month temporary work visa for workers of any skill level.

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2019 Annual HR Update - Current 24

Brexit Cont'd

Workplace Rights in a No-Deal

The Central Government confirms there will be no overall changes to workplace rights
in the event of a ‘no deal’ Brexit.
The technical notices specify that rights derived from EU law – such as annual paid
leave and other working time rights, family friendly rights, protection from
discrimination, harassment and victimisation, and from less favourable treatment for
agency, part-time and fixed-term workers – will continue to apply after the UK
departure date.

There are only two areas of change specified:

> employees working for a UK employer outside of the UK may not be protected in the
event of their employer becoming insolvent.
> no new requests may be made to set up a European Works Council in the UK after
that date.

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2019 Annual HR Update - Current 25

Remember you need to be up-to-
speed with the latest employment

legislation affecting payroll.

HANDY HINTS

HR related Payroll Mistakes

Mistakes that cost you money - SAGE or any other
payroll system are not always automatically aligned with

the latest legislative updates. Be sure to check, as the
software is typically coded to support the most common
work patterns/ schedules. This means unusual patterns
need to be documented clearly for payroll administrators.

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2019 Annual HR Update  26

Due Imminently

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2019 Annual HR Update - Due Imminently 27

Due Imminently Content

PayGap Reporting Gender Pay Gap Reporting - 250+ employees
CEO PayGap Reporting - 250+ employees

The "Good Work Plan" Implementation Extend Itemised Pay Statements to Workers
Employer Penalties for Breaches
Statement of Terms

Tax and Finance National Minimum Wage Increases
Increased Statutory rates
Auto enrolment Increased Contributions

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2019 Annual HR Update - Due Imminently 28

PayGap Reporting

The latest evidence presented in the NI ASHE (Northern Ireland Annual Survey of Hours
and Earnings) statistical survey 2017 - shows that the Gender PayGap in Northern Ireland
remains an issue, still to be addressed. The provisions have been made under the
Employment Act (NI) 2016 to address these issues. Until the time that the provisions
covered by the Act are introduced the Equality Commission NI recommend that business
start preparing now.

Gender PayGap Reporting CEO PayGap Reporting

Private organisations in England, New legislation will also come into force in 2019
Scotland and Wales with 250 or that requires companies with more than 250
more employees will again be employees to publish their executive pay gap
required to publish their gender pay for England, Scotland and Wales.
gap figures on the 4th April 2019.
Although the first reports are not expected until
Employers will be reporting for the 2020 businesses should be calculating the
second time, this year will be the necessary figures throughout 2019 to show the
true test as figures are expected to gap between the total amount paid to their CEO
be heavily scrutinised in order to and the average pay for an employee.
determine whether efforts to So for NI, not yet. But it is clearly a concern
address any significant pay disparity amongst my CIPD peers that for NI a whole
highlighted in 2018 have been slew of changes will become live at one time
successful. and expertese will be stretched, so plan early.

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2019 Annual HR Update - Due Imminently 29

The "Good Work Plan" Implementation

"The four consultations comming out of The "Good Work Plan" commences April 2019.
England, Wales and Scotland will expect to see a few changes in what is contained in payslips,
penalties for employers who fail to pay tribunal claims and statements (contracts) for workers
as well as employees. At the time of writing the local Assembly is inactive and if this
legislation is copied across the Assembly will complete a seperate impact assessment.

Extend Itemised Pay Statements to
Workers

From April 2019, where the amount of wages varies by
reference to time worked, the statement should
include the number of hours worked in respect of the
variable amount of wages or salary.
This needs to be as a single aggregate figure, or
separate figures for the different types of work or
different rates of pay.
The entitlement to a statement of ‘written particulars’
is extended to include workers as well. This will also
become a day one right. So if you're using a GB based
payroll provider, you'll need to check that April 2019
pay statements will look the same as current.

Employers Penalties for Breaches Statement of Main Terms

The ‘Good work plan’, published in Under the ‘Good work plan’, the
December 2018, made a commitment to entitlement to a statement of ‘written
increase the penalties for employers that particulars’ is extended to include workers
repeatedly breach their employment law as well. This will also become a day one
obligations. right. Currently employers have up to two
Tribunals have the power to impose a £5,000 months to issue the statement to any
‘aggravated breach’ penalty on employers employee working for them for more than
losing cases, and from 6 April 2019, the 2 months. So alot more work for
maximum limit on these penalties will rise to employers to do in less time.
£20,000.

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2019 Annual HR Update - Due Imminently 30

Tax and Finance

National Minimum Wage Increases

The national living wage, for those aged 25 and over,
will increase 4.9% from 1 April 2019, from £7.83 to £8.21.

The Low Pay Commission (LPC), which recommended
the increase, estimated that the increase will benefit
around 2.4 million workers. Subject to sustained
economic growth, the government’s aim is for the
national living wage to reach 60% of median earnings
by 2020.

The Treasury says the annual earnings of a full-time
minimum wage worker will have increased by over
£2,750 since the introduction of the NLW in April 2016.

Other rate increases from 1st April 2019:
21- to 24-year-olds by 4.3% from £7.38 to £7.70 per hour;
18- to 20-year-olds by 4.2% from £5.90 to £6.15 per hour;
16- to 17-year-olds by 3.6% from £4.20 to £4.35 per hour;
apprentices by 5.4% from £3.70 to £3.90 per hour.
So make sure your payroll team are aware of the
changes.

Increased Statutory Family and Sick Rates

The weekly amount for statutory family pay rates is expected to increase to £148.68 for
2019/20. This rate will apply to maternity pay, adoption pay, paternity pay, shared parental
pay and maternity allowance.
The weekly rate for statutory sick pay is expected to increase by 2.3% to £94.25 from 6 April
2019.
So make sure you amend budgets, check existing payments and make amendments.

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2019 Annual HR Update - Due Imminently 31

Tax and Finance Cont'd

Auto-enrolment Increases

From April 2019 the minimum contributions for auto-enrolment pension
schemes will increase for both employers and employees.

Currently, automatic enrolment requirements mean employers must
contribute a minimum of 2% of an eligible worker’s pre-tax salary to their
pension pot, with the individual contributing 3% themselves.

However, under the new requirements, employers and employees will now
have to contribute a minimum of 3% and 5% respectively. Employers are
reminded to allow appropriate time to consult with staff before making any
changes to their pension contribution scheme.
So, do an audit of your current pension contributions and if necessary,
communicate changes in line with the legislation.

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2019 Annual HR Update  32

2020 Onwards

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2019 Annual HR Update - 2020 Onwards 33

2020 Onwards Contents

The "Good Work Plan" Implementation Agency Workers
Annual Leave
Tax and Finance Tipping

Brexit Taxation on Termination Payments
Family Entitlements Extension to IR35 to Private Sector
18 year olds auto-enrolment

Brexit Continuity Planning

Gender Transparency on Parental Leave

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2019 Annual HR Update - 2020 Onwards 34

"Good Work" Plan Implementation

The following Regulations come into force on 6 April 2020 and extend to England, Wales
and Scotland. At the time of writing there continues to be a lack of activity with our local
Assembly, therefore a number of employment initiatives are in abeyance. The following are

provided here for information only.

Agency Workers Annual Leave

Employment businesses will be The ‘Good Work Plan’ , makes a
required to provide every agency commitment to improving the holiday
worker with a document known as a pay arrangements for seasonal workers,
“key facts page”. who tend to lose out over the way it is
currently calculated. 
This will need to include certain To correct this, the government is
details, such as the type of contract lengthening the reference period for
they are employed under, the determining an average week’s pay from
minimum rate of pay they will receive 12 weeks to 52 weeks from 6 April 2020.
and details of any fees that might be
taken. This will help agency workers This is worth bearing in mind if
better understand their basic terms, tendering for multi-year work with
which can be especially difficult where seasonal workers, as there is a forecasted
intermediary umbrella companies are increase in resourcing costs.
involved.

Tipping

Rules will be implemented to ensure that tips are passed directly to the individual,

rather than taken by the employer.

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2019 Annual HR Update - 2020 Onwards 35

Tax and Finance

Taxation on Termination Payments

The government’s plans to make any part of a
termination payment over the sum of
£30,000 subject to employer NICs is due to
become law in 2020. This is the end of tax
free ex-gratia payments for redundancies,
retirements and settlement agreements etc.

This change was delayed from April 2018.

Extension of IR35 to Private Sector

The IR35 tax rules will be extended to the
private sector in April 2020.
It has been expected that the change would
come into effect in April 2019, following a
consultation in 2018.

Extend Auto-Enrolment to The rules are aimed at reducing tax avoidance
18 year olds for off-payroll contractors working through
personal service companies (PSC). So if you
The Central Government have revealed use a significant percentage of contractors this
plans to reduce the minimum age for is one to have on the long range radar.
auto-enrolment to 18 by the mid-2020s.
Under the current regulations, Since April 2017, public sector employers have
employers must only auto enrol eligible been responsible for deciding whether IR35
staff over the age of 22 and are earning applies, and for deducting tax and NICs from
more than £10,000. The reduction in contractors’ fees paid through PSC’s when it
age will affect approximately 900,000 does not. The extension will only apply to
young people! large and medium-sized organisations. So in
one year's time this is a future tax implication
for businesses.

www.CatherineKaneAssociates.co.uk

2019 Annual HR Update - 2020 Onwards 36

Brexit

Continuity Planning for Brexit and Beyond

Brexit and its ongoing implications will impact an organisation’s ability to sustain its
business as usual. However, by focusing on the relevant people-related contingencies,
planning ahead and taking action for what needs to be done to address them.

In considering the people aspects of your organisation’s continuity
planning, have you:

Conducted a workforce audit to Considered other options for reducing
identify which employees may need staff costs and voluntary redundancies
support with pre-settled and settled ahead of compulsory redundancies?
status applications?
Ensured your processes for obtaining
Discussed with EU nationals in your work visas and permits for employees you
workforce about their intentions as to wish to send to work in the EU are up to
accrue time towards residency in the date and fit for purpose?
future, or whether they plan to leave
the UK? Ensured your UK citizen staff have
applied for recognition of their
Reviewed your workforce planning for qualifications or driving licences as
low-skilled roles and considered relevant if working in an EU state?
future recruitment channels?
Reviewed your obligations towards your
Spoken to a payroll specialist employees (and their families) who work
regarding international payments in the EU, such as tax advice or health
through a forward contract or made insurance?
other arrangements with a currency
specialist? Agreed the terms of any relocations,
including responsibilities for expatriation
Reviewed payment clauses for arrangements and costs, length of
international staff to ensure their pay relocation and pay?
is unaffected by fluctuating exchange
rates? Given reassurance about any ongoing
uncertainty and kept staff up to date with
Reviewed employment contracts to information concerning them and the
see whether you can implement lay- business?
offs, shorttime working or relocations,
or else consulted with them to Provided any opportunities where
introduce such provisions? employees can talk confidentially about
their concerns or ask questions?

Updated your redundancy policies Put in place the relevant measures for
should you need to reduce your supporting employees through anticipated
workforce? changes and communicated them?

www.CatherineKaneAssociates.co.uk

2019 Annual HR Update - 2020 Onwards 37

Family

Transparency on Parental Leave

LinkedIn claimed that a third (36%) of UK professionals thought their employer did not do
enough to support new parents.

The survey of 4,000 UK workers provided evidence that professionals felt they were being
left in the dark when it comes to parental policies, with a third (37%) not even aware of what
support their workplace provides for new parents

Research also suggests that 54,000 women a year lose their jobs because of pregnancy or
maternity discrimination. An increase in transparency is needed and it is believed that this
should drive up standards around parental leave and pay and will support parents’ decision-
making when applying for jobs.

The proposal is that employers (starting with those who employ 250+ staff) publish their
parental leave and pay policies.

We suggest in readiness for the rollout of this new initative, our retained clients review
existing parental leave policies this year, and benchmark against competitors and best in
industry. But there is a clear landscape of businesses needing expertise to publish more
information than ever before, and it starts with larger organisations and works down and
will likely be required in Northern Ireland last of all - but the admin skills and systems
required to keep within the regulations is increasing each year- you need to plan for it and
invest in your systems/ HR technology.

The research showed the benefits that most parents value to get balance with work and
family were:

- More flexible/agile working - Better maternity or paternity pay

- A creche onsite or nearby - Better pay and bonuses

- Paid-for childcare or subsidies - Equal paternity rights for me

-

www.CatherineKaneAssociates.co.uk

GET INVOLVED
ONLINE FORUM DISCUSSION

Microchipping Employees

If recent news stories are to be
believed the act of
microchipping employees may
become more common in the
UK workplace during 2019.

The UK legal system has not yet Click this link for
been challenged in this regard, further details and to
however it will be interesting to get involved online in
see how a court decides to rule
on microchipping staff given the our Forum.
potential invasion of privacy
and GDPR implications. 

https://www.catherinekaneassociates.co.uk/hr-forum

Swedish firm Biohax has already microchipped 4,000 employees, while a UK firm, BioTeq,
has reportedly fitted 150 people with implants in the UK. The chips are the size of a large

grain of rice (2 x 12mm) and are typically inserted in an individual’s hand. They can be used
for security access, logging onto computers and making payments.

www.CatherineKaneAssociates.co.uk

Next Up
Tribunal Watch

TRIBUNAL WATCH
Includes Tips for Employers

TRIBUNAL WATCH
FIVE BIG ONES

1. Employment status in Gig Economy      
2. Is failure to enhance Shared Parental Pay discriminatory towards men?
 
3. Restrictive Covenant prevents Ex-Employee from being "Interested in"
Competitors
4. Alcohol and Drug Testing at Work
 
5. Supermarket equal pay claims      

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2019 Annual HR Update - Tribunal Watch  41

TRIBUNAL WATCH

EMPLOYMENT STATUS IN THE GIG IS FAILURE TO ENHANCE SHARED
ECONOMY PARENTAL PAY DISCRIMINATORY
TOWARDS MEN?

In 2019 we can expect to see: Ali v Capita Customer Management Ltd
The common consensus is that one of
> a possible appeal against the Court of the main reasons that shared parental
Appeal’s decision that Uber drivers are leave has not been more popular is that
“workers” and not self-employed; employers that enhance maternity pay
are not legally obliged to enhance
> further developments in the Independent shared parental pay.
Workers’ Union of Great Britain’s (IWGB’s) However, this case explores whether or
challenge that, for collective bargaining not it is sex discrimination for
purposes, Deliveroo couriers are self- employers to enhance pay during
employed; and maternity leave, but not during shared
parental leave.
> potential appeals against the EAT decisions
classifying its couriers and drivers as workers, In this case, a male worker claimed that
and not self-employed. his employer discriminated against him
because of his sex by denying him the
Employer Tip: - The cases are important because a opportunity to take shared parental
finding that gig economy staff are “workers” means leave on full pay. (His partner worked
that they are entitled to basic employment rights, for a different organisation.) Mr Ali
such as the national minimum wage and paid failed at the Employment Appeal
annual leave. If you have a concern on your total Tribunal (EAT) stage and has appealed
resource costs, speak to Catherine. to the Court of Appeal.

Employer Tip: - A finding of sex
discrimination could force employers to
reconsider their policies if they provide
shared parental pay at the statutory level,
but offer increased contractual maternity
pay. The court of appeal is scheduled to hear
the case on 1st May 2019.

www.CatherineKaneAssociates.co.uk

2019 Annual HR Update - Tribunal Watch  44

TRIBUNAL WATCH

RESTRICTIVE COVENANT PREVENTS EX-EMPLOYEE FROM
BEING "INTERESTED IN" COMPETITORS

Tillman v Egon Zehnder Ltd
In 2019, we will find out from the Supreme Court whether or not a
restrictive covenant that prevents an ex-employee from being
“concerned or interested in” a competitor for six months is too wide to
be enforceable. 

A senior member of staff within executive recruitment and
management consulting group Egon Zehnder wished to take up
employment with a US firm. However, she appeared to be
prevented from doing so as a result of a restrictive covenant that
contained a six-month non-compete clause. The clause stipulated
that she should not “directly or indirectly engage or be concerned
or interested in any business carried out in competition”.
The Court of Appeal interpreted the phrase “concerned or
interested in” as being too wide to be enforceable, since it could
even prevent a person from holding shares in a company. The
clause was set aside in its entirety, meaning that the ex-employee
was free to work for the US firm.

Employer Tip: - If the Supreme Court agrees with the Court of Appeal,
you may need to review any restrictive covenants in your contracts or
settlement agreements, to ensure that they are not drafted too widely.

www.CatherineKaneAssociates.co.uk

2019 Annual HR Update - Tribunal Watch  45

TRIBUNAL WATCH

ALCHOHOL AND DRUG TESTING AT WORK

Mr Ball, a 61-year-old diabetic, was employed as a bus driver with First Essex Bus Limited
for over twenty years before his dismissal for gross misconduct in July 2017. The company
had a drugs and alcohol policy which stated that employees may be subject to randomised
testing.

On 6 June 2017, Mr Ball was subject to a saliva test which showed positive for cocaine. He
was then invited to a disciplinary hearing and summarily dismissed for gross misconduct.
His appeal was unsuccessful.
Mr Ball maintained his innocence and argued that there had been flaws in the testing
process. He said that he had not been asked to wash his hands or wear gloves before
handling his saliva sample.
Due to his job, Mr Ball believed that his handling of money - as well as having a tendency
to lick his fingers when they were sore - meant that bank notes containing traces of
cocaine had contaminated his saliva sample. He also voluntarily took a drugs test outside
of the disciplinary process - known as a hair follicle test - which detected no cocaine in
his system. The company dismissed this test.

Mr Ball brought claims for wrongful and unfair dismissal. The company argued they had
a legitimate reason for dismissal and followed a fair procedure, Mr Ball’s claims were
upheld and he was awarded c. £84k

Employer's Tip
Employers don't make rash decisions on the outcome of drugs tests and always follow your own
disciplinary and drug and alcohol policies. What’s more, always take mitigating circumstances into
account when it comes to disciplinary proceedings and failed drugs tests. If this issue arises, speak to
us first.

2019 Annual HR Update - Tribunal Watch  44

TRIBUNAL WATCH

SUPERMARKET EQUAL PAY CLAIMS

At some time in 2019, we are expecting to receive decisions on separate tribunal cases
on the issue of equal pay which involve Tesco, Asda, Morrisons and Sainsbury’s
respectively.

The employees in each of these cases are seeking compensation for predominately
female shop workers who feel they are unfairly paid less than predominately male
warehouse staff, despite carrying out a similar role. This will provide more clarity on
the issue of equal pay and, depending on the result, may pave the way for further
claims from staff working in other sectors.

Employer Tip: - Don't rely on environmental factor's soley as a rationale for differential pay.
Think if this might impact your organisation.

www.CatherineKaneAssociates.co.uk

THE SUPPLEMENT

ROBIN HOOD

www.CatherineKaneAssociates.co.uk

THE SUPPLEMENT 46

Robin Hood

I first read about this years ago in a book - The Strategy Process - where Robin Hood one
morning realised that he has gone from a small-time redistributor of wealth to having a
band of forty plus dependants, all looking for shelter, healthcare and a venison roast
dinner. All unintended consequences of success.

It's no secret – being a business owner and/ or Director can be an isolating job. You most
likely started out wanting to excel with your sector skills and expertise. You brought your
commercial acumen, high standards, ambition and strategic thinking together to get where
you are today. But did you set-out to be an employer, or was that a job you picked up along
the way? If not, then it's a potentially a difficult situation business owners find themselves
in - with regards to your unexpected responsibilities and skills required to be an employer.
If you don't have the skills, it can get in the way of setting the direction to which you drive
your high performance culture through an engaged team.

Research from the Harvard Business School has shown that the top 10% high performing
business leaders demonstrate high levels of what are called Emotional Intelligence (EQ)
skills - which counts for twice as much as IQ and technical skills combined. Emotionally
Intelligent leaders build a culture of openness, honesty and trust.

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THE SUPPLEMENT

47

How to build my band of merry warriors?

Being a leader is a people business, so you need to know your own strengths,
surround yourself with excellent people and work effectively through them. You
know you can feel it, when someone is right for your business. It's that
subjective, hard to describe feeling. They seem to have the right personality
traits and demonstrate the right behaviours.

When I think about the best managers/ Directors I’ve worked alongside, there
are a handful of behaviours that they all seem to share.

They have a plan - it may not be worked through, but they
at least have shared the plan with their team. The team have
the direction they need and everyone is facing the same
way.

Harness their team's excellence/ strengths and is not
intimidated by others skills, instead recognises these traits,
for the good of the team/ business.

They are able to and want to listen without jumping to
conclusions. And they imagine how other people might
feel. By using empathy as their navigator, they signal to
people affected by a decision or action that they’re not
alone and have been heard.

They engender trust by seeking out feedback, even if the
feedback is expressed as criticism. They can show
vulnerability which shows people around them that they
are not perfect.

They are able to remain calm when the going gets tough.
They can regulate their emotions and gather their team
together to inspire, motivate and deliver.

So, if you find yourself looking at your employees as problems to be solved,
you may need an Azeem - a trusted advisor with another perspective or a
coach to help challenge and guide you as you grow, or why not give yourself
a gift of a book on EQ - "Emotional Capitalists" by Martyn Newman PHD.

www.CatherineKaneAssociates.co.uk

Catherine Kane Associates
028 9008 0017
077737 666 93

www.catherinekaneassociates.co.uk
[email protected]

@Catherinegkane linkedin.com/in/catherinekaneassociates

Sources: - CIPD, LRA, ACAS, IBEC, Employment Rights Act (NI), McKinsey, HMRC , The Good Work Plan
publication and www.gov.uk/employment-tribunal-decisions