Employment Update - January 2024

Immigration Crackdown

The UK Government has announced far-reaching changes to the UK's immigration system as part of a five-point plan to reduce net migration. The changes follow the release of the migration figures at the end of November 2023, which showed net migration levels at an all-time high.

The following changes were originally announced to take effect from Spring 2024 but the Government has now said they will be implemented according to the following timeline:

• April 2024: the minimum salary threshold to qualify for a Skilled Worker visa will increase, from the current £26,200 to £38,700.  Employers must pay at least the minimum salary threshold or the 'going rate' for the role (whichever is higher) in order to sponsor a Skilled Worker visa. The Government has indicated that those already on Skilled Worker visas will not be subject to the higher salary threshold when they apply to change employer or extend their visas.
  
  
• No earlier than April 2024: salary discounts which apply to jobs on the Shortage Occupation List will be abolished and the roles on the list will be significantly reduced. The Shortage Occupation List comprises roles which are deemed by the Government to be in short supply and, currently, such roles can be paid at a rate that is up to 20 percent less than the 'going rate' and still qualify for sponsorship through a Skilled Worker visa.
  
  
• Incrementally from "Spring 2024": the minimum level of income required by British nationals or those settled in the UK who wish to bring dependant family to the UK will also increase from the current level of £18,600 initially to £29,000 in “Spring 2024” and will then increase incrementally to around £34,500 later in 2024 before increasing to £38,700 in early 2025.
  
  
• Early 2024: those coming to the UK on Health and Care visas will no longer be able to bring dependants, including a spouse or children - the government has said it intends to implement this change "as soon as possible".
  
  
• January to late 2024: the Graduate visa route is also set to be reviewed and reformed, with the review starting in January and running potentially until late 2024. The Graduate visa route currently allows overseas students to stay in the UK to work for up to two years after completing a bachelor's degree in the UK (or three years for PhD holders).

The new measures are likely to cause difficulties for employers who are struggling to recruit skilled and specialist talent. For more information, please see our briefing on the changes.

Business Visitors

The rules for business visitors are being amended with effect from 31 January 2024. The amended rules will confirm that a business visitor may undertake some remote working while in the UK in connection with their overseas employment, provided this is incidental to the purpose of their trip. The rules will also expand the scope of work that a business visitor can undertake for a UK branch or related entity. Currently business visitors can undertake a range of internal activities when visiting a UK branch or related entity such as providing training, troubleshooting or consulting. From 31 January 2024, a visitor from an overseas related entity will also be allowed to undertake these activities directly with a client where this is required for the delivery of a project or services by the UK entity and the work is incidental to the visitor's employment abroad. The amended rules will also expand the scope of activities which can be undertaken by an overseas lawyer as a business visitor.

Right to work checks

As previously reported in Employment Update, the fines for employing illegal workers are being tripled. From 24 January 2024, employers found to be employing illegal workers will face a civil penalty of up to £45,000 for a first-time offence or up to £60,000 for a repeat offence. Ahead of the changes, employers may wish to review their right to work compliance processes to ensure they are as robust as possible. We regularly provide training on right to work checks and conduct audits of our clients' processes to ensure compliance with the right to work requirements.

Increase in visa fees

As previously reported in Employment Update, the Immigration Health Surcharge (or IHS) will increase from £624 to £1,035 per person per year. The planned increase has now been pushed back and should now take effect on 31 January 2024 at the earliest. The IHS is payable upfront as part of most work visa applications and contributes towards the costs of running the NHS. This IHS increase represents a significant additional cost for visa applicants.

Redundancy consultation – how far do you have to go?

A recent case suggests employers should have some form of "workforce consultation" in a redundancy situation, regardless of the number of redundancies proposed.

The employee in this case worked for a recruitment consultancy. He was part of a team of 16 people employed to recruit exclusively for one client, an investment bank. During the pandemic, the bank's recruitment requirements halved, and the employer decided to reduce its workforce. Before putting anyone at risk, the employer scored the 16 employees against selection criteria which had been provided by its US parent. It was then decided that the company needed to lose two of the 16 roles. As the employee scored the lowest, he was put at risk and ultimately made redundant after a couple of individual consultation meetings. During consultation, the employee had not been given his scores. He appealed his redundancy and was given his scores during the appeal process, but the appeal was ultimately unsuccessful. He then brought an unfair dismissal claim.

The Employment Appeal Tribunal (EAT) ruled that the redundancy was unfair. The employer had failed to consult meaningfully at an early stage when employees could have proposed a different approach to the redundancy process or proposed ways to avoid the redundancies altogether. As a matter of good industrial relations, there should have been some form of "general workforce consultation" such as a meeting of all those affected to discuss these points before the scoring exercise. This was particularly the case where the selection criteria, which were entirely subjective, had come from the US parent and may not have been appropriate for a UK redundancy exercise. While an appeal could correct errors such as the failure to provide the employee with his scores, it could not repair the gap in consultation at the formative stage.

Resignation – can the employee take it back?

A recent case has considered what happens when an employee resigns in the "heat of the moment".

The employee was a supervisor at a Citizens Advice Bureau. During a heated exchange with his manager over holiday, he said that he had had enough and would be off. His manager later asked him to put his resignation in writing which he agreed to do. However, a few days later he sought to retract the resignation. When the employer refused to allow him to withdraw it, he brought claims for wrongful and unfair dismissal.

An Employment Tribunal initially ruled that the resignation should stand but the Employment Appeal Tribunal (EAT) disagreed. According to the EAT, the key question was whether the employee "really intended" to resign. If he did, then the resignation would stand but if not, it was not an effective resignation to begin with. The EAT decided the case had to be reheard by a fresh Tribunal to decide this question.

Carer's leave

On 6 April 2024, a new right to carer's leave will come into force. Under the new law, employees will be able to take up to one week of unpaid leave per year to provide or arrange care for a dependant with long-term care needs. New regulations have been made which clarify how the right will work in practice:

• the right will apply from "day one" of employment and there will be no service requirement;
  
  
• the right will apply to employees who have a dependant with long-term care needs (e.g. an elderly or disabled relative);
  
  
• employees will be able to take half-days or full days, either consecutively or in separate chunks, up to a total of one week in any rolling twelve-month period;
  
  
• employees will be required to give notice in writing to take carer's leave which is at least twice the length of the leave requested, subject to a minimum of three days' notice;
  
  
• employers cannot refuse a request but can postpone a request by up to a month if it would cause undue disruption to the business;
  
  
• employers cannot ask for evidence of the dependant's care needs;
  
  
• employees are protected from detriment or dismissal for taking or seeking to take carer's leave.

Employers should update their policies and handbooks to reflect the new right.

Flexible working

On 6 April 2024, the right to request flexible working will become a "day one" right, meaning employees will not need any service to make a request. Currently, employees need at least 26 weeks' service to qualify for the right to request. At the same time, the following changes will come into force: 

• employers will have a new duty to consult the employee before rejecting a flexible working request;
  
  
• employers will have two months to complete the process, including making a decision on any appeal brought by the employee (reducing from the current three-month period); and
  
  
• employees will be allowed to make two statutory requests in any 12-month period (increasing from the current limit of one request per 12-month period).

Acas plans to publish a revised statutory code of practice on handling flexible working requests in 2024 which incorporates these changes. Employers should review their flexible working policies ahead of April 2024 to ensure the changes are reflected.

Redundancy protection

Employees who are made redundant during maternity, adoption or shared parental leave must be offered a suitable alternative vacancy if there is one. On 6 April 2024, this protection will be extended so that:

• for maternity, the protection will begin when an employee notifies her employer that she is pregnant and ends 18 months after the birth;
  
  
• for adoption, the protection will end 18 months after the child is placed for adoption (or the date the child enters Great Britain in the case of overseas adoptions); and
  
  
• for those taking at least six consecutive weeks of shared parental leave, the protection will end 18 months after the child's birth or placement for adoption.

Employers will need to have systems in place to record these periods, in the event of a redundancy exercise involving employees who have taken maternity, adoption or shared parental leave. 

Paternity leave

As first announced in June 2023, the Government plans to make a number of changes to the way statutory paternity leave is exercised. Draft regulations have now been laid which will introduce the following changes where the expected birth or placement for adoption is on or after 6 April 2024:

• fathers/partners will be able to take paternity leave in two separate blocks of one week, instead of having to take either one or two consecutive weeks;
  
  
• fathers/partners will be able to take paternity leave at any time within 52 weeks of the birth or adoption (currently paternity leave must be taken in the first eight weeks after birth or adoption); and
  
  
• the notice required for paternity leave will reduce from 15 weeks to 28 days before each period of leave.

National minimum wage

On 1 April 2024, the annual increase in the hourly rates of the National Living Wage (NLW) and National Minimum Wage (NMW) will take effect. In addition, the age at which the NLW is payable will reduce from 23 to 21 years.

The hourly rates applicable from 1 April 2024 will be:

• £11.44 for workers aged 21 or over (increasing from the current rates of £10.42 for workers aged 23 and over and £10.18 for workers aged 21-22);
  
  
• £8.60 for workers aged 18-20 (increasing from the current rate of £7.49); and
  
  
• £6.40 for workers aged 16-17 and apprentices under 19 or in the first year of apprenticeship (increasing from the current rate of £5.28).

Covering striking employees

The Government recently ran a consultation on a proposed change to the law that would allow agency workers to cover the work of staff who are on strike. Currently it is a criminal offence for an agency to supply agency workers to cover the work of employees who are on strike (or the work of employees who are themselves covering the work of employees on strike). The Government previously made this change to the law in July 2022 but the change was reversed following a High Court ruling in July 2023. The High Court ruled that there had been insufficient public consultation prior to the change being made. The consultation closed on 16 January 2024 and the Government's response is awaited. 

Fire and rehire

In 2023, the Government ran a consultation on a draft statutory Code of Practice on the use of "fire and rehire" to change terms of employment. "Fire and rehire" refers to the practice of terminating employment contracts and offering employees new contracts on revised terms as a way of introducing changes where the employer is unable to get employees' agreement.  A Government spokesperson has indicated that the final version of the new Code of Practice will be published in Spring 2024. Once in force, employers will need to follow the Code when changing terms and conditions, as a failure to do so could result in an uplift in compensation of up to 25 percent in any relevant claim. 

• In 2023, Travers Smith participated in the Single Homeless Project (SHP) festive giving by donating over 250 Christmas gifts for people living in SHP's hostels.
  
  
• In recent weeks, our team has been involved in a variety of pro bono work for organisations such as Refugees at Home, GiveOut and the Women's Sport Trust.

Since the last Employment Update, our work has included:

• acting for a client on a defence of a sex discrimination claim (listed for 10 days) with allegations of direct discrimination, harassment and victimisation
  
  
• working with a client in respect of a pan-European restructure, including advising on collective consultation obligations
  
  
• acting for a client who is the transferor in a business sale, specifically around their TUPE information and consultation obligations and the provision of Employee Liability Information
  
  
• advising a public company on a redundancy programme impacting senior employees and associated settlement arrangements 
  
  
• conducting diversity and speak up training for managers at a global asset management firm
  
  
• carrying out an independent investigation into bullying and harassment complaints on the grounds of religious belief
  
  
• advising a US based client on worker status risks associated with several UK based contractors
  
  
• carrying out a cultural review for a client following multiple whistleblowing allegations
  
  
• defending a Tribunal claim regarding alleged failures in collective redundancy consultation
  
  
• advising on the TUPE aspects of an outsourcing arrangement.