REC reminds businesses that National Living Wage rise must be reflected in treatment of suppliers

Commenting on the April 2024 National Living Wage (NLW) increase, REC Chief Executive Neil Carberry said:

“This year’s rise in the National Living Wage is far in advance of both wider wage rises and prevailing inflation. It will put significant strain on businesses in key sectors, notably those who sell directly to the consumer. Many businesses will face choices over raising prices, changing working patterns or shorter opening hours as they try to adapt in the midst of a recession.

“Businesses agree that the minimum wage has been a highly successful policy and support a rising rate, but success has been driven by involving employers closely in the process. Going forward, we hope to see the Low Pay Commission put back in charge of the pace of increase based on insight from businesses and workers. A politically driven minimum wage risks employment opportunities for the most vulnerable workers and the sustainability of many smaller local businesses, especially on our under pressure high streets

“It is vital that businesses understand that their suppliers, including REC members supplying a million temporary workers every day, also face this increase. Approaches which seek to offload rising temp minimum wages onto agencies are unsustainable. When the cost of labour rises, that rate needs to be passed on.”

Ends

BRIEFING NOTE FOR MEDIA

April changes for employers in 2024 - REC

In 2024 there has been a wide range of updates to the law which will impact recruiters and employers – with more to come in April. The Recruitment and Employment Confederation (REC) has produced a briefing note on the many changes.

Amendments to the Working Time Regulations 1998

The Employment Rights Amendment Revocation and Transitional Provisions Regulations 2023 came into effect on the 1st of January 2024. These Regulations amend the holiday provisions under the Working Time Regulations 1998 and the consultation obligations relating to SME employers and small transfers under the Transfer of Undertakings Protection of Employment Regulations 2006, otherwise known as TUPE. Specifically, the amendments to the Working Time Regulations 1998 introduced the 12.07% accrual method and rolled up holiday pay to irregular hour and part year workers into legislation. Other changes include defining an irregular hours or part year worker, the repeal of emergency provisions enacted in 2020 providing workers the right to carry over leave for reasons related to COVID-19 and the legal requirement to remind workers of their entitlement to take leave. Whilst the Regulations came into effect on the 1st of January 2024 these changes to holiday pay apply to irregular hours and part year workers whose leave year or assignment starts from the 1st of April 2024.

Right to Request Flexible Working

The Flexible Working (Amendment) Regulations 2023 are due to come into force on the 6th of April 2024. The Regulations amend the Flexible Working Regulations 2014 to allow for the right to make a flexible working request to become a day one right. Employees applying for flexible working before the 6^th of April will still be required to have 26 weeks continuous employment to make a request. Other changes which do not yet have a commencement order but are due to come into force include allowing employees to make two flexible working applications every 12 months. Employees are currently only allowed to make one flexible working request per year. The updates to the flexible working regime removes the requirement for employees to explain what effect they think their flexible working request will have on the employer. They require employers to consult with an employee before refusing their flexible working application and they also require employers to respond to flexible working requests within two months. It is also worth noting that the two-request limit to flexible working requests will include requests made under the Workers (Predictable Terms and Conditions) Act 2023.

National Minimum Wage and National Living Wage

From the 1st of April 2024 the National Living Wage (NLW) will increase. Additionally, the National Living Wage will be extended so that it applies to workers aged 21 and over and to live in domestic workers.

Employee's National Insurance Reduction

The employee primary Class 1 national insurance contributions rate has been reduced from 12% to 10%. This came into effect from the 6th of January 2024. Further changes announced in the Spring Budget 2024 include the employee primary Class 1 national insurance contributions rate is due to be reduced further from 10% to 8%. This is due to come into effect on the 6th of April 2024.

Immigration Changes

Amongst the wide range of immigration changes recently, the Home Office has updated the statutory Code of Practice for the ‘Right to Work’ scheme, which came into effect on the 13th of February 2024. The Code sets out the prescribed checks and information that must be retained by employers to obtain a statutory excuse against liability for a civil penalty and how the Home Office determines the value of the civil penalty in cases where illegal working is identified. This will apply to right to work checks completed on or after the 13th of February 2024. Further immigration changes members must be aware of includes the increase in the maximum civil penalty for the illegal employment of adults subject to immigration control. The increase is from £20,000 to £45,000 per illegal worker for a first breach and £60,000 per illegal worker for repeat breaches. This will apply to breaches applying on or after the 13th of February 2024.

Equality Act (Amendment) Regulations 2023

The amendments to the Equality Act 2010 have been introduced to ensure that EU discrimination law, rights and principles are reflected in domestic UK law from the 1st of January 2024. There are an extensive number of changes of which recruitment businesses should be aware of, most notably including the following: Firstly, there has been the extension and introduction of numerous protections relating to pregnancy, childbirth, and maternity. There has also been the introduction of section 19A to the Equality Act 2010, which allows those who do not possess the protective characteristic but can show that they have suffered the same disadvantage arising from a discriminatory policy or practice as a person who has the protected characteristic to bring a claim of indirect discrimination. The additional introduction of section 60A to the Equality Act 2010 which amends the Equality Act to allow for claims for direct discrimination to be bought on grounds of discriminatory statements related to recruitment. An example of such scenario might be where someone connected to an employer makes comments about not wanting to recruit people with certain protected characteristics, even if such statements are made while there is no ongoing recruitment process. The new provision means that an employer may be liable for statements made by someone who is not its employee or agent where there are reasonable grounds for the public to believe that they are capable of influencing the making of a recruitment decision by the employer.

Furthermore, there have been updates to equal pay provisions of the Equality Act. The Act has been updated to allow for equal pay claims to be brought based on a comparison of pay with an employee working for a different employer where their terms of employment are derived from a single source responsible for setting or continuing the pay inequality and which can restore equal treatment. Finally, there has been an update to the definition of a disability for the purposes of bringing a discrimination claim. The update extends the definition of normal daily activities beyond the general common and frequent activities to those which are less frequent such as siting examination for a promotion.

Ends