Employment Law Updates

Most often these include tweaks to the various financial limits that apply to things like statutory sick pay, redundancy, maternity pay, and the national minimum wage.

April 2024 saw the national living wage and national minimum wage being increased to:

• £11.44 per hour for workers over 21 years old;
• £8.60 for workers aged 18 and 20 inclusive; and
• £6.40 for young workers under 18 years old.

In addition, there were increases for the following statutory payments:

• Statutory maternity/adoption pay and statutory paternity pay/shared parental pay was increased to £184.03 per week.
• Payments for absence from work due to incapacity (statutory sick pay) was increased to £116.75 per week.
• The maximum gross weekly cap for statutory redundancy payments was increased to £700 per week.

There have also been some interesting employment law developments over the course of the past few months.

Irregular Hours and Part Time Workers

On 8 November 2023, the UK government announced major reforms to the rules on holiday pay set out in the Working Time Regulations 1998. The amended regulations introduced definitions for “irregular hours workers” and “part-year workers” following a period of uncertainty when calculating holiday entitlement for these workers.

For individuals who meet the requirements, holidays will now accrue on the last day of each pay period at the rate of 12.07% of the hours actually worked in that pay period. In terms of statutory leave and sick leave – employers will be required to use a 52 week reference period to determine leave when the employee is absent from work.  

Although previously prohibited under UK Employment Law, employers are now able to pay workers “rolled up holiday pay”. Rolled-up holiday pay is paid to workers as a 12.07% uplift of the worker’s remuneration in that pay period. The worker shall not be paid for their holiday when they take it since they will already have been paid in their pay packet.

The new rules apply to holiday years starting on or after 1 April 2024. Those employers who adopt a holiday year of 1^st January – 31^st December will need to wait until 1^st January 2025 to implement the changes unless they change their holiday year.

Carrying Over Leave

The Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023/1426 came into force on 1^st January 2024 to restate the effect of certain decisions of the Court of Justice of the European Union (following the UK’s departure from the European Union).

The regulations contain a right for workers to carry over holidays if they are unable to take their holidays as a result of taking a period of statutory leave. There is no statutory deadline by which the worker must take their carried over leave.

Workers shall also be able to carry forward holidays if they are unable to take their holidays due to sickness. However, workers must take their carried over leave within 18 months of the end of the leave year to which they relate.

Finally, workers are able to carry forward leave if their employer fails to:

• recognise a worker’s right to annual leave or paid annual leave;
• give the worker a reasonable opportunity to take leave or encourage them to do so; or
• inform the worker that leave not taken will be lost.

Leave which is carried over due to the failure of an employer must be used before the end of the first leave year in which there is no failure by the employer.