Employment law: what might happen in 2022?

Good governance

Amy Wren

If we have learned one thing from 2021 (and indeed 2020 before it), it is that we never know what is around the corner. Whilst some things in the employment world for the year ahead are more certain than others (the Supreme Court and Court of Appeal for instance will hand down important judgments on two holiday cases)… other things are less certain, such as whether the much anticipated Employment Bill will finally be implemented or, dare I say it, whether another furlough scheme is on the cards. Below is a summary of our predictions for things to look out for in the employment sphere in 2022.

Employment Bill

First mentioned in the Queen’s Speech in December 2019, the Employment Bill is yet to materialise, but has been promised “when parliamentary time allows”. Some progress has been made and it has now had its first reading, so 2022 could be its year! The Bill is wide-reaching and includes:

  • A single enforcement agency for employment rights: this will have a wide remit to improve the protection for vulnerable workers, including in respect of National Minimum Wage, enforcement of anti-slavery provisions, statutory sick pay and holiday pay, and unpaid tribunal awards.
  • Carer’s leave: the government has committed to introducing a new leave entitlement for unpaid carers. All employees in the UK would be eligible from day one of their employment to take one-week’s unpaid carer leave to care for a “dependant” who has a “long-term care need”.
  • Extended redundancy protection: protection for pregnant women and new mothers would be extended to cover the period a pregnant employee notifies their employer of their pregnancy until six months after the end of their maternity leave.
  • Predictable and stable contracts: all workers with variable hours will have a right to request a more predictable and stable contractual working pattern after 26 weeks’ continuous service.
  • Neonatal leave and pay: from day one of employment parents of babies that are admitted into hospital aged 28 days or younger could claim neonatal leave if the admission lasts for seven continuous days or more. Entitlement is up to a maximum of 12 weeks. Pay will be subject to certain conditions.
  • Non-disclosure agreements: following criticism about the misuse of non-disclosure agreements, in 2019 the government signalled its intention to legislate to ensure confidentiality clauses in employment contracts and settlement agreements clearly set out their limitations, including a prohibition on preventing someone from making disclosures to the police or health care or legal professionals.

Flexible working

Currently, workers don’t have a statutory right to flexible working, but may request it after 26 weeks of employment. However, this could change in 2022 following the government’s recent consultation on making flexible working the default (ie giving employees a right to request from day one). The consultation also looked at a range of flexible working patterns, not restricted to working from home, such as job-sharing, flexitime, annualised hours (where employees work a certain number of hours per year rather than per week), and phased retirement. This consultation closed on 1 December and a response is awaited. For more information, see our blog on the consultation here.

For employers wanting more information about the law on flexible working and calls for reform, the House of Commons Library has published a briefing on Flexible working: remote and hybrid work.

Sexual harassment

In the middle of last year, the government published its response to a consultation on sexual harassment in the workplace. In this, it committed to the following:

  • Introducing a positive duty on employers to prevent sexual harassment.
  • Implementing explicit protections from third party harassment.
  • Looking “closely” at extending the time limit for bringing Equality Act 2010 claims from the current time limit of three months to six months.

Whilst the potential changes outlined in the response, if implemented, will have a significant impact on sexual harassment obligations in the workplace, we currently do not have detail about how any new provisions will work in practice or the timeframe for when they may be introduced.

Further details about all of these can be found in our blog Sexual harassment in the workplace.

Holiday in Court

At the end of last year, the Court of Appeal and Supreme Court considered two cases on holiday pay and entitlement. Decisions are expected in the first half of this year, which could have a significant impact on how employers manage holiday and their liability for backdated pay.

Smith v Pimlico Plumbers

This is a dispute that will be familiar to most of us, since it has been rumbling on in one form or another for over seven years. In 2018, the Supreme Court upheld the decision of all the courts before it that Mr Smith was a worker and not self-employed (for our commentary on the decision, see here). In the latest instalment, the case was back in the Court of Appeal in December 2021 to consider whether holiday entitlement can be carried over indefinitely in circumstances where a worker has taken annual leave, but is not paid for it. To date, both the Employment Tribunal and the Employment Appeal Tribunal have dismissed Mr Smith’s claim, holding that the time limit for claiming unpaid annual leave is three months from the date of the last holiday period, and not the date of termination. The Court of Appeal’s decision will provide some much needed clarity about the scope of an employer’s liability for backdated holiday pay in worker cases of this sort (though query whether it will be the end of the matter or whether this part too will eventually end up in the Supreme Court).

Harpur Trust v Brazel

In another much anticipated case about holiday entitlement, the Supreme Court in November 2021 was asked to consider whether workers who are engaged throughout the year, but do not work for the entirety of that period, can receive pro-rated holiday entitlement based on the number of weeks a worker actually works. The Court of Appeal disagreed and found that “part-year workers were entitled to the full 5.6 weeks” holiday, despite the fact that this could result in them receiving more holiday than their full time colleagues. For the full facts of this case, see our blog Holiday pay for termtime workers should not be pro-rated. The Supreme Court’s decision could have significant implications for employers who engage workers on permanent contracts, but who do not work the entirety of the year, such as term-time only workers, seasonal workers or those on parent-friendly flexible working arrangements.

Consultation outcomes

The Employment Bill isn’t the only thing the government has promised “when time allows”. The outcomes of a number of reviews and consultations are pending and it will be interesting to see which produce results in 2022. These include:

  • A review of gender pay gap reporting regulations: required by April 2022 (to comply with an obligation to review within five years of the original regulations coming into force).
  • Disability workforce reporting consultation: as part of its National Disability Strategy, the government has launched a consultation on workforce reporting on disability for large employers. The consultation considers current practices on workforce reporting on disability, and how these might be stepped up, possibly building on existing gender reporting requirements. The consultation closes on 25 March 2022 and responses can be submitted here.
  • Greater menopause protection? As we mentioned in our blog Steps to create a menopause-friendly workplace, cases relating to menopause have tripled in the Employment Tribunal over the past three years. An inquiry by the House of Commons Women and Equalities Committee into workplace concerns relating to the menopause closed in September 2021 and we are currently awaiting the results. The chair of Committee said she would not rule out making changes to the Equality Act 2010 to protect menopausal women who are discriminated at work.
  • Data protection reforms: at the end of last year, the government sought views on proposals to reduce the burden of data protection on businesses. The ICO is also expected to update its guidance on employment practices and data protection.
  • Ethnicity pay gap reporting: a government consultation on ethnicity pay reporting by employers closed in January 2019; the website still says the government is “analysing your feedback”.
  • Ban on exclusivity clauses: another government consultation which ended in February 2021 and on which we are awaiting a response regarding measures to extend the ban on exclusivity clauses in contracts of employment.

More furlough?

Dare we say it? With increasing Omicron cases (and the possibility of other variants?!), it is hard to predict what might happen in terms of possible Covid restrictions this year. Certainly there is no suggestion of anything at the minute, although a Treasury source reportedly told The Times that “If we… are telling businesses that they have to shut their doors then it is not unreasonable for them to expect additional government support. That could mean a return to the furlough scheme”. Covid has shown the ability to surprise us, so it is not beyond the realms of possibility that further government support could be offered to employers should restrictions be needed at any point. Certainly furlough dominated both 2020 and 2021, only time will tell if it features this year too.

In conclusion, 2022 looks to be a lively year on the employment front and there is a lot of potential… especially if “parliamentary time allows”!

If you require further information about anything covered in this blog, please contact Amy WrenRose Sethi or your usual contact at the firm on +44 (0)20 3375 7000.

This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.

© Farrer & Co LLP, January 2022

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