The changes to statements of main terms (timing, content and scope) will continue as planned for 6th April, as will the changes to calculating holiday pay, etc. below is a flavour of what you should be aware of as an SME…

New Reference Period Rules for Calculating Holiday Pay

The reference period used to calculate holiday pay for workers with variable pay is changing on 6 April 2020.

Currently, this is the pay that a worker receives during the 12 weeks worked prior to taking a holiday…

Fluctuations in pay meant that holiday pay would be higher if leave is taken immediately following peaks and lower holiday pay if it is taken following troughs.

Come 6 April 2020, the reference period will be changed to 52 weeks, or the number of weeks of employment if a worker has been employed for less than 52 weeks.

You will need to consider the following:

For the purposes of holiday pay, many organisations begin their holiday year on 1 January. If that is the case, employers need to decide whether to change the way they calculate holiday pay on 6 April, or at the start of your holiday year. Organisations will need to consider the cost and practical issues which can arise, such as holiday carry over.

How do you calculate holiday when and if pay varies over this period?

Many employers have been considering how to include variable pay in holiday pay. Whilst the change in the law only affects the reference period, April 2020 may be a good time to review how employers calculate holiday pay more broadly. 

Parental Bereavement Leave

From April 2020 employees who have lost a child will be entitled to two weeks leave, there is no service qualification for this leave. Employees who have 26 weeks continuous service will be paid at the statutory rate in force at the time.

We are still awaiting details of whether this should be taken in one block or non-consecutive days, or whether evidence needs to be provided… obviously a sensitive issue and employers will need to handle the administration of this with great care.

Changes to written Terms of Employment

All workers (not just employees) will have a right to a written statement of terms – this statement must now be issued on the first day of employment at the very latest! Information that should be included in the statement has been increased to include the following aspects: Length of time the job is expected to last, notice period, eligibility for sick leave and pay, other rights to leave, probationary periods, all pay and any benefits, specific times and days of work.

SME business owners should review their terms and conditions accordingly and ensure that they provide these revised terms to all workers.

Extending Redundancy Protection for Women and New Parents

Before making a woman on maternity leave redundant, an employer must offer her a suitable alternative vacancy where one is available. This protection will apply from the point an employee notifies the employer of her pregnancy (including verbal notifications) up to six months following her return to work.

Increased Sexual Harassment Protections on the back of the #MeToo movement

There is a new duty for employers to take all reasonable steps to prevent harassment, with the reintroduction of the protection from third party harassment, and protection extended to volunteers and interns. Review your current procedures and provide training on what constitutes harassment… banter is not a defence!

We understand as Operational Managers and busy business owners that you may not have time to process these variations. We would love to help you. Call us and we will assist you to navigate these changes, by amending your policy and helping you with implementation.

HRCentral – Your Outsourced HR Department 0118 324 2526