Employment law – hot topics for 2018

03 / 01 / 2018

2017 saw a number of major themes in employment law: the cancellation of Tribunal fees; the push back against the treatment of individuals engaged in the gig economy; and the fight against sexual harassment. So, what does 2018 have in store?

2018 will see:

  1. Employment status – potential changes to the legal protections afforded to individuals;
  2. Mental health and wellbeing – a greater onus on employers to protect workers;
  3. Technology – the issues that arise as a consequence of the increased use of technology in the workplace;
  4. Data/data protection – coming into sharper focus, especially with the advent of the GDPR;
  5. The fight against human trafficking;
  6. Tax changes in relation to termination payments; and
  7. Brexit – but this is a topic for another day…

There was a raft of case law in 2017 considering employment status. In Uber BV v Aslam & Others the EAT upheld the ET’s decision that Uber drivers were workers (to read more on this click here). Uber’s appeal will be heard by the Court of Appeal at some point this year and the Supreme Court is due to hear the appeal in the Pimlico Plumbers case in February 2018.

Worker status may be redefined following the recommendations of the Taylor Review and more recently, “A framework for modern employment” prepared by the Business Energy and Industrial Strategy Committee. The law needs to be updated to take into account the ever-evolving work arrangements that exist in markets that are transformed by the next “disruptor” business model (often made possible by the power of technology, allowing the use of apps and fuelled by big data).

ACAS has also stimulated the debate in relation to mental health by publishing new Guidance on the promotion of positive mental health in the workplace; done against the backdrop of statistics from the Department of Health that show that one in four of us will experience mental ill health at some points in our lives and ACAS’s own statistics that indicate that mental illness costs employers in the UK up to £30 billion per year in lost production, absence from work and recruitment costs.  Failure to address mental health issues in the workplace can also put employers at risk of litigation from discrimination claims, unfair dismissal and personal injury claims. The purpose of ACAS’s Guidance is to support employers because, if nothing else, it is in their financial interests to improve awareness of mental health issues within their organisations by:

  1. tackling the causes of work related mental ill health;
  2. creating a culture where staff can talk about their mental health without fear of stigma; and
  3. supporting staff members who are experiencing mental ill health.

ACAS’s Guidance recommends that businesses create a mental health policy, train managers and educate their workforce so that both physical and mental wellbeing is promoted and supported in the workplace. Our team has been trained in Mental Health First Aid and we have developed an ACAS compliant training and documentation package. If you would like further information, please do get in touch.

ACAS’s Guidance comes at a time when technology is also encouraging us to become the most organisationally and personally self-aware of all generations: biometric security for entry systems and authentication for certain areas in the office; sound and motion sensors; air and water quality control systems; all sorts of sensors to provide information about how our desks, IT equipment, etc. is being used – and all “overseen” by CCTV.  As individuals, we also have “fit bits” and other wearable tech that can monitor our exercise, sleep, the air quality of the street and our office environments, as well as water quality.  As we continue to own and upgrade personal tech that can tell us about ourselves and our environment, employers will face challenges, including:  providing an environment that is both attractive and “fit” to work in; workers who have got not just knowledge of their own physical and mental health, but also of the environment created by their employer, e.g. sick building syndrome, poor light, blurred boundaries between work and home because of tech, leading to lack of rest/the ability to “turn off”.

Accordingly, the way that we are classified (employee, worker or independent contractor) affects the rights that we have in the work place; statistics about our susceptibility to mental ill health and the technology that is available to cities, employers and individuals and the personal and sensitive personal data that this personal technology throws off, potentially creates a perfect storm – the contract that individuals work under, the hours that are worked, the ability for the employer to monitor output, the technology that allows cities, employers and individuals to monitor the environmental factors that may impinge upon both physical and mental health, together with the associated data, potentially puts the individual in a very strong position to be able to bring claims concerning their physical and mental wellbeing against those responsible for working conditions and the environment in which work is carried out.

It is for these reasons that we say that 2018 will see a “sea change” in the way that we think about work, our working environment, mental health and wellbeing because the power of existing technology is capable of being utilised to support individuals who claim that, either their physical and/or mental wellbeing is adversely affected by working conditions, including the environment in which they are required to work.

Finally, three further pieces of legislation that will be prominent in 2018:

  1. the Modern Slavery Act 2015, designed to stem the fastest growing and second most lucrative criminal activity that is human trafficking, will be used more to prosecute those involved in the recruitment, transportation, and harbouring of a person by threat, force, coercion, abduction, deception, or abuse of their vulnerability with the aim of exploiting them;
  2. the General Data Protection Regulation, otherwise known as the GDPR, is due to come into force as of 25 May 2018. The GDPR will significantly increase the legal obligations on businesses to control, process and protect data in a responsible way. The reputational and financial consequences of failing to comply could be extremely high; and
  3. the measures brought in under the Finance (No.2) Act 2017, effective from 6 April 2018, that split an employee’s termination pay into 2 types: payments that can still benefit from the £30,000 exemption threshold and those that cannot. Payments up to the £30,000 cap for statutory (and non-contractual and possibly even contractual) redundancy pay remain exempt from both income tax and NICs, as do genuine ex gratia payments, Tribunal awards for wrongful and unfair dismissal, but all PILONs, whether contractual or paid in breach of a contractual right to do so, will be classified as “taxable earnings” and so be subject to both income tax and Class 1 NICs. This change is made in order, it is said, to achieve fairness and clarity – the tax and NICs consequences will be the same for all employees and no longer dependent on how the employment contract is worded or whether termination payments are structured in some other way, such as damages. The foreign service exemption will be abolished too. The tax treatment of compensation for discrimination claims remains dependent on the precise nature of the payment – some will fall within the £30,000 cap (if the discrimination that causes the injury to feelings arises from the termination of the employment) and some will be entirely free of tax and NICs (from 6 April 2018, this will be restricted and apply only in relation to payments in respect of a psychiatric injury or other recognised medical condition). From April 2019, any payment which qualifies for, but is over the £30,000 exemption cap (eg: for loss of office), will become subject to employer’s only (not employee’s) NICs.

We are here to help, train and advise. We are a business too, so are facing similar challenges – how to be, not just legally compliant, but also ethical, owning a culture that promotes “doing the right thing”, but is not naïve and yet is still profitable. If business was easy, we would be out of business.

Happy New Year.