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What to expect in employment law in 2023

Posted: 11/01/2023

Twelve months ago we published a similar article looking ahead to what 2022 might bring to the world of employment law. It is fair to say that while some predictions were borne out, 2022 also threw its fair share of curve balls - while we expected a double bank holiday for the Queen’s Platinum Jubilee in June, for example, we were unaware that there would be a further additional bank holiday just three months later to mark her funeral.

2023 will of course see another additional bank holiday for the coronation of King Charles III, and it raises the usual question for HR practitioners as to whether employees are entitled to this additional day’s leave (see last year’s article, linked above, for an analysis of this).

The long-awaited Employment Bill also failed to materialise in 2022, and the changes in government that we have seen have led to the shelving, for now at least, of Dominic Raab’s plans to replace the Human Rights Act with a new Bill of Rights. The government’s response to the consultation on disability workforce reporting, part of the National Disability Strategy published in July 2021, also failed to materialise, despite being expected in June 2022.

Restructuring and redundancy

The new year dawns with much uncertainty, after the political and economic turbulence of 2022. This year is likely to also see its fair share of turmoil, and restructuring and redundancies are likely to be commonplace. Dismissals can lead to disputes and litigation, particularly in an economic downturn where alternative employment may be hard to come by.

It will be interesting to see how the employment tribunals, already struggling with their workload, will cope with increased demand. Delays of up to two years are already present in claims being listed for hearing – further delays will make it even more difficult for aggrieved employees to seek justice, and will impose an additional costs and resources burden on employers having to deal with those claims.

Industrial action

Industrial unrest dominated the headlines towards the latter part of 2022 and, at the time of writing, ongoing disputes, including those for postal workers, nurses, ambulance drivers and railway workers, show no signs of resolution. Strikes and other industrial action are likely to be a major factor in 2023. Employers and unions will be watching with interest the judicial review brought by 11 unions, coordinated by the TUC, of the government’s decision to allow agency workers to cover striking employees, in a major overhaul of industrial relations legislation.

The government has also announced its plans to introduce fresh curbs on the right to strike, including providing for ‘minimum service levels’ in a number of sectors including transport, the health service and education, and allowing employers to take legal action against unions and dismiss employees if these levels are not met.

Although Prime Minister Rishi Sunak has stated that the proposals would restore the balance between the right to strike and "the right of the British public to be able to go about their lives without suffering completely undue disruption”, if taken forward they are likely to be highly contentious and lead to further legal action against the government.

Brexit and the future of EU law

The big issue for employment lawyers and HR practitioners is, however, the possible ‘sunsetting’ of all EU-derived secondary legislation by the end of 2023, under the Retained EU Law (Revocation and Reform) Bill 2022. If brought into force in its current form, the legislation will allow the government to ‘amend more easily, repeal and replace’ law derived from the EU which has until now been kept as part of the Brexit arrangements.

The bill is due to come into force at the end of this year and will have a transition period until mid-2026. Any EU-derived legislation that is not specifically retained will no longer apply. In the employment law context, this includes such major pieces of legislation as the Working Time Regulations, the Agency Workers Regulations and TUPE, and the bill is likely to lead to considerable confusion and uncertainty for some time to come.

The bill has been heavily criticised from many sides, not least because of the sheer volume of work involved in scrutinising all relevant legislation in so short a timeframe. While there is no indication that the bill is to be shelved, it seems likely that the timeframe for its implementation will be extended.

Flexible working and family friendly rights

At the end of 2022, the government finally published a response to its consultation document on the future of flexible working, launched the previous year in response to the Covid-19 pandemic. The response indicates that there will be a number of changes to the existing statutory regime. These include making the right to request flexible working a day one right for all employees, requiring employers to consult with employees to look at alternative options before declining a flexible working request, and increasing the number of requests that an employee can make in any 12-month period from one to two. There is currently no timeframe for implementation of these changes, and developments will be awaited with interest.

The long-awaited right to carer’s leave has also failed to materialise, although it is likely to be implemented at the same time as the changes to the flexible working regime. This new statutory right will be up to one week of unpaid carer’s leave per year from day one of employment for employees who need to care for a spouse, partner, civil partner, child, parent, household member or dependant. The government may also introduce additional paid leave for parents of babies in neonatal care, and additional protection against redundancy for pregnant women and new mothers.

In the courts

We are likely to see more developments in the field of holiday pay, with the Supreme Court due to hand down its judgment in the case of Chief Constable of the Police Service of Northern Ireland and another v Agnew and others, which was heard at the end of last year. The question in Agnew is whether a three-month gap in a series of deductions breaks the chain of deductions. If, as is widely expected, the Supreme Court finds that it does not do so (as this is not a requirement of the relevant legislation), then claims for backdated holiday pay could be considerably more significant. This is of particular concern for employers in the gig economy, or who engage a lot of individuals as independent contractors and not as workers, with no entitlement to paid annual leave.

Also in the courts, there are likely to be further developments in the field of worker status and agency workers’ rights. The case of R (on the application of Independent Workers Union of Great Britain) v Central Arbitration Committee, which concerns whether delivery riders were workers, and therefore covered by collective bargaining rights, will be heard by the Supreme Court. Additionally, the appeal in Kocur v Angard Staffing Solutions Limited, regarding the extent of an agency worker’s right to be notified of vacancies at the hirer, will be heard. There will also be more fallout from the Covid-19 pandemic, as cases on dismissals and other Covid-related issues reach the higher courts.

As 2023 commences, once again there is much uncertainty as to what the new year will bring to employment laws, the workplace, and the wider political and economic landscape. In 12 months’ time, will any of the changes anticipated here have materialised, and what unexpected curveballs will be thrown our way? Only time, and our January 2024 newsletter, will tell…

For further information on how these issues might affect your organisation, please contact Paul Mander.

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