Now that the UK’s post-Brexit transition period has come to an end, the Government is free to amend employment laws that it wouldn’t have been able to before. However, there are limitations. The agreement reached between the UK and the EU stipulates that neither party will ‘weaken or reduce’ employment law protection in such a way that will affect trade or investment between the UK and the EU.
It might be surprising to note that this obligation does not just apply to EU governed employment law; it refers to all employment law. Whilst unfair dismissal law is not covered by EU law, the government would be in breach of the trade agreement if it were to repeal it entirely. Neither can the government repeal the Working Time Regulations 1998 or the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE).
There are, however, some changes that the government could make that would not impact on trade, but which could nevertheless be of significance to UK employment law. By way of example, the calculation of holiday pay has been a vexed issue for several years now and there is a significant disparity between what the Working Time Directive requires (as construed by the European Court) and the requirements under the Working Time Regulations 1998. The government is now free to provide much-needed clarity on issues as the extent (if at all) to which overtime pay should be included in holiday pay and the impact of long-term sickness absence. In the event that the Working Time Regulations were amended, the UK courts would no longer have to consider the requirements of the Working Time Directive when applying the new law.
The government may consider changes in other areas which might include: allowing changes to terms and conditions to be made more easily post- TUPE transfer; imposing a statutory cap on discrimination compensation; and making agency worker rules more straightforward. It remains to be seen whether, and to what extent, the government will make such changes. However, since commitments in relation to redundancy protection for new parents and additional leave for carers remain outstanding from the Conservative Party’s 2019 manifesto, a significant Employment Bill is anticipated for 2021.