Employment and immigration | Regulatory Outlook July 2022

Latest on proposed workplace reforms

As detailed in our Insight, there have been a number of workplace reforms, including:

Menopause will not be a protected characteristic under the Equality Act

The government has confirmed that it does not intend to make menopause a protected characteristic under the Equality Act 2010 or to implement the dual discrimination provision in the 2010 Act (which would allow an individual who believes that they have been treated less favourably because of a combination of two protected characteristics to bring a combined claim), as the protection under the existing protected characteristics is believed to be adequate and introducing combined discrimination would bring unwelcome regulatory complexity and place new costly burdens on businesses and the public sector. Employees can already bring a discrimination claim on two or more grounds, which the courts can consider within a single claim.

Higher damages against trade unions and temporary workers to replace striking employees

Against the backdrop of ongoing and proposed industrial action, new legislation has been laid before Parliament to increase the limits on the maximum damages award which may be made against a trade union where industrial action is found to be unlawful and to revoke the restriction on employment businesses supplying temporary workers to replace striking workers during official industrial action.

It is intended that with effect from 21 July 2022, the limits on the maximum damages awards that may be made against a trade union where industrial action is found to be unlawful will be increased as follows:

• Less than 5,000 members: £40,000 (currently £10,000).
• 5,000 to 24,999 members: £200,000 (currently £50,000).
• 25,000 to 99,999 members: £500,000 (currently £125,000).
• 100,000 members or more: £1,000,000 (currently £250,000).

Regulations have also now been published which propose to revoke regulation 7 of the Conduct of Employment Agencies and Employment Businesses Regulations which prevents an employment business from supplying an employer with temporary workers to perform duties normally performed by a worker who is on strike or taking industrial action, or the duties normally performed by any other worker who has been assigned to cover a striking worker. Listen to our podcast for more on this from Partner Julian Hemming.

Code of Practice on dismissal and re-engagement

We have previously reported on the government's announcement that it will issue a statutory code of practice on dismissal and re-engagement. During a debate in the House of Lords it has been confirmed that a draft code will be published for consultation this summer.

HMRC keeps up investigations into tax evasion in labour supply chains

HMRC has released, on 30 June 2022, figures for the number of live corporate criminal offence investigations. The report confirms that labour provision remains a high-risk area.

Even where its reviews have not revealed deliberate facilitation of tax evasion, HMRC confirmed that the reviews have led it to find other tax and regulatory offences to pursue. This fits with HMRC's historic stance of finding civil enforcement easier than prosecution.

However, even if prosecution is avoided – and there are signs HMRC is now more aggressive in their pursuit so this cannot be assumed – a civil investigation with 20-years' tax exposure and penalties of up to 200% can still be a business-critical event. See more in our Insight.