Regulatory Outlook | Employment and Contingent Workforce | January 2018

Current issues

Gender pay reporting:

The new gender pay reporting requirements require employers with 250 or more employees to publish prescribed gender pay gap data based on a snapshot taken on 5 April 2017.   This data must be published by 4 April 2018 and companies should now start considering when they will upload their data and whether/what additional information will be provided in a voluntary narrative to support or provide context to their report.

Gig economy:

The government-commissioned review on Modern Working Practices was published in July 2017 and better clarification of employment status and greater protection for gig economy workers were key recommendations.  This was echoed in the gig economy report ‘A Framework for Modern Employment’ and draft Bill, published jointly by the Work and Pensions and Business, Energy and Industrial Strategy select committees in November 2017. The government has delayed the new legislation on the gig economy that would reform employment practices, amid growing concern that reforms to boost workers’ rights could face parliamentary opposition from certain parts of the Conservative party. Putting into practice clear tests for employment status will be challenging. In the meantime, businesses must keep a watchful eye on emerging case law to understand the rights and liabilities of their workers.

The General Data Protection Regulation (GDPR):

The GDPR, which comes into effect in all EU Member States from 25 May 2018, has particular implications in the context of employment.  Employers must start preparing now as the new regime has stricter requirements for consent (which must be ‘freely given’) and provides new and enhanced rights for individual data subjects to access and erase their personal data. These changes should be reflected in policies and procedures and training provided.

Mental health in the workplace:

The government has published an independent report containing 40 recommendations, including: ‘mental health core standards’; legislative reform to enhance protections; and the creation of online portals to provide support. This report follows recently published ACAS guidance on work-related stress and promoting positive mental health in the workplace. Employers should ensure their policies underpin a workplace culture that supports mental health.

Failure to prevent the facilitation of tax evasion: implications for users of contingent workers:

The new offence, which came into force on 30 September 2017, concerns the failure to prevent the crimes of those who act for or on behalf of a corporation.  The offence widens the scope of those who can be held to account under criminal law.  This can be quite a risky area for users of contingent workers and staffing companies, as they can commit this offence if their supply chain is held to be evading tax and if they have not put in place adequate procedures to prevent the facilitation of the tax evasion.

Enabling tax evasion offence:

The government has introduced sanctions (in force from 16 November 2017) that apply to ‘enablers’, where a taxpayer has entered into an abusive tax arrangement that HMRC has defeated. Each person in the supply chain who has enabled the use of the arrangement is potentially liable to a penalty and naming. The measure can apply even if the taxpayer who entered into the defeated abusive tax arrangement does not incur a penalty.

Reforms to IR35 in the private sector:

The government reformed the off-payroll working rules (known as IR35) for engagements in the public sector in April 2017. There had been indications that this could potentially be extended to the private sector in April 2018. Instead, however, the government announced in the 2017 Autumn Budget that it will consult on how to tackle non-compliance in the private sector, drawing on the experience of the public sector reforms throughout 2018, with any new legislation likely to be introduced in 2019.

Dates for the diary