New legislation announced to introduce government's Good Work Plan

Following on from the Taylor review, greater rights and clarity will be afforded to workers.

Government consultations on four areas of employment law, including status and worker rights, have led to the announcement of the ‘Good Work Plan’; a plan to “strengthen workers’ rights” whilst embracing the benefits of changes within the labour market and employment models. The plan announces that new pieces of legislation will be introduced in the future to create additional rights; these include:

  • the right for all workers to request a more stable contract once they have reached 26 weeks’ service
  • from 6 April 2020, workers and employees will be entitled to a written statement of terms from day one of their employment with an increased amount of mandatory information to be contained within the statement
  • agency workers will be entitled to a Key Facts Page setting out important information regarding pay and other terms
  • increasing the required period to break continuous service from one week to four weeks, recognising the increasing flexibility of modern work
  • lowering the threshold for employees to make a request to introduce information and consultation arrangements from 6 April 2020
  • extending the holiday pay reference period to 52 weeks, from 12 weeks, from 6 April 2020 to allow a fairer approach to calculating holiday pay.

The plan also confirms the recent announcement that legislation will be used to ban tip deductions and a further ban on the use of Swedish derogation agency contracts was announced. These type of contracts, also known as ‘Pay Between Assignment’ contracts, entitle agency workers to receive pay when they are not assigned to an end-user but exempt the agency worker from equal treatment to pay when they reach 12 weeks’ service within an assignment. A prohibition on the use of these from 6 April 2020 will provide a guarantee on equal pay treatment for all agency workers under the Agency Worker Regulations. By 30 April 2020, organisations will have to provide a written statement to these agency workers informing them of the change.

The area of difficulty for many, as identified by Matthew Taylor in his review and the numerous tribunal cases considering this matter, continues to be the identification of employment status. To address this, the government’s plan confirms that future legislation will be used to “improve the clarity” of the current employment status tests and will also help reflect the modern relationships within the labour market. In addition to the legislation, further improvements will be made to current guidance and online status tools.

To place the onus on organisations to implement the law and worker rights correctly, the maximum penalty for an aggravated breach will be quadrupled with effect from 6 April 2019 to £20,000, currently £5,000, and there will be new legal sanctions introduced to penalise organisations who commit repeated breaches. The government expects these to be effective as there will also be an obligation placed on tribunal judges to consider whether these sanctions are appropriate in all cases.

« Back to News