Our employment lawyers look at what changes are on the horizon in employment law for 2018. For more information on any of the below topics, please get in touch with the team

General Data Protection Regulation (GDPR) 

Perhaps the biggest impact on employers this year is the introduction of the GDPR, which will replace the existing Data Protection Act 1998 on 25 May. The aim of the GDPR is to make the data protection framework fit for the digital age, and give individuals more control over their data. All businesses, service providers, and public bodies (regardless of size or sector) will need to ensure compliance with this new legal framework.

Employers will need to ensure that the safeguarding of individuals’ personal data is central to their data practices. Conducting a thorough assessment of their current activities, including why they’re collecting data, and how they’re processing it, is a crucial first step for all organisations.

Gender Pay Gap Reporting

All employers with 250 or more employees now need to publish statutory calculations every year, showing whether there is a pay gap between their male and female employees, and if so, what that gap is.

In the private and voluntary sector, eligible employers will need to publish their first report by 4 April. Public sector employers will have until 30 March 2018 to do the same.

Employers must publish their gender pay gap data along with a written statement on their public website. They must also report this data online to the government via the gender pay gap reporting service.

The gig economy

2018 will inevitably see more debate regarding the gig economy in the UK. But, we may start to get some answers. We expect that the government will give its verdict on last year’s Taylor Review, and we may see some changes to worker status.

Several cases are also due to be heard this year, including those of Pimlico, Blakely and Uber. These decisions are eagerly awaited. They’ll have implications for business across the country – given that workers, as opposed to those who’re self-employed, are entitled to rights like National Minimum Wage, paid holiday and rest breaks.

Taxation of termination payments

From the 6 April, all payments in lieu of notice (PILONs), whether contractual or not, will be treated as ‘taxable earnings’.

In practice, this means that employees will be required to pay income tax and national insurance contributions (NIC) on all PILONs, whether such payments are provided for in their contracts of employment or not.

Changes to National Minimum and Living Wage

From 1 April, the National Minimum Wage will increase again to the following rates:

  • £3.70 per hour for apprentices
  • £4.20 per hour for 16-17 year olds
  • £5.90 per hour for 18-20 year olds, and
  • £7.38 per hour for 21-24 year olds.

The National Living Wage (for those aged 25 and over) is also set to increase to £7.83 per hour.

Holiday pay

Following last year’s landmark ruling from the Court of Justice of the European Union (CJEU) in relation to carrying over holiday pay, a decision from the Court of Appeal is expected on the issue this year. The CJEU held that workers who hadn’t taken holiday because their employers had (incorrectly) told them that they had no right to do so can carry over their paid holiday rights until the termination of their employment.

Many employers may now see an influx of back-dated holiday pay claims, which could stem back as far as 1996 (when the European legislation came into force).

We’re waiting to see whether the Court of Appeal will uphold this European ruling.

Family-friendly rights

In the coming months, the Employment Appeal Tribunal will likely consider whether an employer can lawfully pay more to a mother on maternity leave than it does to a father on shared parental leave. The EAT is expected to look at direct sex discrimination in the cases of both Capita Customer Management Limited v Ali, and Hextall v the Chief Constable of Leicestershire Police.

We may also see further development in the government’s plan to introduce grandparent leave. It was originally intended that this year, new rules would allow working grandparents to take shared parental leave and pay. But, the EU referendum postponed this, and there haven’t been any steps to progress it so far.