2021年3月、内務省 (Home Office) は採用活動に関して労働者のスポンサーが保管すべき文書に関する重要な説明を発表しました。この変更は有用なものであり、順守は特に煩わしいものではありません。ただし、確実に順守するためにアクションを取る必要のある雇用者もいます。

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変更はスポンサー向けガイダンスの付録Dに記載されており、スポンサーに対する文書管理要件が取り上げられています。

更新の背景

熟練労働者のルートの立ち上げを含め、スポンサー付き労働者向けの移民手続きが大幅に改定され2020年12月1日に施行されました。それまでのティア2（一般）とは異なり、このルートには正式な居住者労働市場テストの要件としないことを確定しました。

2020年12月1日に付録Dの最初の変更が発表され、この中ではスポンサーから内務省に居住者労働市場テストの実施を報告した場合の採用活動について、その証拠を維持する必要性だけが言及されていました。

この当初の表現には内務省の意図が適切に反映されていませんでした。正式な居住者労働市場テストが要件ではない場合でも、スポンサー付き労働者が雇用された空席が純粋な空席であったかどうかについて評価できる態勢を留めるということが内務省の意図でした。よって内務省は2020年12月18日に付録Dを改訂しましたが、その改訂の中で、正式な居住者労働市場テストに以前含まれていたものと同様の非常に規範的な文書管理要件を再導入しました。

内務省と移民担当の専門家の間で交わされたその後の会話ややり取りによって、内務省の意図は正式な居住者労働市場テストの要件を実質的に再導入することではないこと、より説明的なガイダンスが今後出てくることが確認されました。このガイダンスが最終的に2021年3月16日に発表されました。

新たなガイダンスの要件

スポンサーが採用活動に関して維持すべき証拠について取り上げた付録Dの第2部は2つのセクションに分けられました。

セクションAは正式な居住者労働市場テストまたは同様のものが要件とされていた、または要件であるという状況（2020年12月1日前のルートの下で要件とされていた状況と、T2スポーツ選手、T5宗教従事者、T5クリエイティブ、T5スポーツ）について取り上げています。おおむね、2020年12月1日前の付録Dを踏襲しています。

セクションBは正式な居住者労働市場テストが不要な状況（2020年12月1日以降の熟練労働者およびその他スポンサー付き労働者。T2スポーツ選手、T5宗教従事者、T5クリエイティブ、T5スポーツを除く）を取り上げています。

セクションBでは、求人を広告した場合、採用活動の証拠維持を確認しています。維持すべき証拠には次のものが含まれます。

• 広告の詳細、具体的には：
  • 出稿した広告のスクリーンショット、印刷、コピー。（広告の最低限の数や広告手法についての指示はありませんが、該当する全ての広告の証拠を維持することをお勧めします。）
  • 求人広告の掲載場所（ウェブサイトのアドレスなど）およびその期間。

• 仕事に応募してきた人数、面接およびその他の採用プロセスの段階に招待された人数の記録。
• 最適な候補者の特定のためにスポンサーが利用したプロセスを示す証拠または情報を少なくとも1件（採用されなかった候補者の個人データを保管する必要はない点にご留意ください）：
  • 採用された候補者の面談メモの写しまたは要約
  • 選定プロセスの一環として全候補者に使った面接時の共通の質問一覧
  • 採用された候補者が選ばれた理由と他の候補者が却下された理由に関する短いメモ
  • 採用された候補者を特定するために使われた得点付けや評価付けプロセスに関する情報
  • その他関連する情報や証拠

 

求人広告を出さなかった場合、スポンサーは求められた場合には、スポンサー付き労働者が適切であるとどのように特定したのかについて説明（および可能であれば証拠を提供）できる必要があります。例示列挙すると次の通りです。

• 大学での会社説明会の証拠（熟練労働者の事前要件に関する各大学からの手紙）。
• その労働者が既に他の移民ルートでスポンサーにおいて合法的に勤務しており、以前の業績によって適任であることが示されている。
• その労働者が、募集を行っていない職種に応募し、スポンサーとしてはその仕事に対する必要なスキルや経験を有していると判断した（面接、紹介および／または資格などから）。

スポンサー付き労働者の人事ファイルに短いメモを含め、適宜、適切な説明ができるようにしておくことをお勧めします。

今講じる実際的なステップ

スポンサーは更新されたガイダンスを確実に順守すべきです。2020年12月1日以降に移民申請をした全労働者に対して順守を図ってください。ガイダンスは過去にさかのぼるもののようですので、2020年12月18日のガイダンスで設定された一段と煩雑な要件には従う必要はないというのが当方の見解です。

ガイダンス改訂版の変更点や順守に関するご質問は、移民チームのメンバーまでお問い合わせください。

 

Related Item(s): Immigration & Global Mobility

Author(s)/Speaker(s): Li Xiang,

On 16 March 2021 the Home Office made important clarifications to the documentation that sponsors of workers must keep regarding their recruitment activity. The changes are helpful and should not be onerous for sponsors to comply with, however there may be actions that some employers will need to take to ensure compliance.

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The changes are set out in Appendix D to the sponsor guidance, which covers document keeping requirements for sponsors.

Background to the update

Substantial reforms to the immigration arrangements for sponsored workers were brought into effect on 1 December 2020, including the launch of the Skilled Worker route. This route, unlike its predecessor Tier 2 (General), does not include a formal resident labour market testing requirement.

An initial update to Appendix D, which was published on 1 December 2020, stated that sponsors only needed to retain evidence of recruitment activity where the sponsor had told the Home Office that resident labour market testing had been carried out.

This initial wording did not adequately reflect the Home Office’s intention to ensure it was still able to assess whether a vacancy occupied by a sponsored worker was a genuine vacancy, even where formal resident labour market testing was not required. The Home Office therefore revised Appendix D on 18 December 2020, however, in doing so, reintroduced some very prescriptive document keeping requirements that were similar to what had previously been in place for formal resident labour market testing.

Subsequent conversations and correspondence between the Home Office and immigration practitioners confirmed that it was not the Home Office’s intention to reimplement formal resident labour market testing requirements in all but name, and that clarifying guidance would be forthcoming. This was eventually published on 16 March 2021.

Requirements in the new guidance

Part 2 of Appendix D, which covers the evidence that sponsors must keep of recruitment activity has now been split into two sections.

Section A covers the situation where a formal resident labour market test or similar was, or is, required (ie where it was required under the pre-1 December 2020 routes, plus T2 Sportsperson, T5 Religious Worker, T5 Creative and T5 Sporting). It broadly replicates Appendix D as it was before 1 December 2020.

Section B covers the situation where no formal resident labour market testing is required (ie for Skilled Worker and all other sponsored workers from 1 December 2020 aside from T2 Sportsperson, T5 Religious Worker, T5 Creative and T5 Sporting).

Section B confirms that if the job was advertised, evidence of recruitment activity must be retained, including:

• Details of adverts, ie:

• Screenshot, printout or photocopy of any adverts placed (with no minimum number of adverts or prescribed method of advertising, however retaining evidence of all relevant adverts is recommended)

• Information on where the job was advertised, eg website address, and for how long

• A record of the number of people who applied for the job, and the number of people shortlisted for interview or other stages of the recruitment process

• At least one item of evidence or information which shows the process the sponsor used to identify the most suitable candidate (noting that there is no need to retain any personal data for unsuccessful candidates):

• Copy or summary of interview notes for the successful candidate

• List of common interview questions used for all candidates as part of the selection process

• Brief notes on why the successful candidate was selected and why other candidates were rejected

• Information about any scoring or grading process used to identify the successful candidate

• Any other relevant information or evidence

If the job was not advertised, the sponsor must, if asked, be able to explain (and if practicable provide evidence of) how the sponsored worker was identified as being suitable. Non-exhaustive examples given include:

• Milk-round evidence (ie letters from each university as per pre-Skilled Worker requirements)

• The worker was already working legally for the sponsor in another immigration route and their previous performance demonstrated they were suitable

• The worker submitted a speculative application and the sponsor was satisfied (eg through interview, references and/or qualifications) that they had the necessary skills and experience for the job

We would suggest that a short note is included on the sponsored worker’s HR file to provide the relevant explanation as appropriate.

Practical steps to take now

Sponsors should ensure that the updated guidance is complied with, including that it is met for all workers whose immigration applications were made on or after 1 December 2020. The guidance appears to be retrospective, so our view is that sponsors do not have to meet the more onerous requirements that were set out in the 18 December 2020 guidance.

Sponsors should be aware however that the definition of ‘worker’ used in the guidance includes workers under the Intra-company routes, so should be prepared to justify the suitability of intra-company transferees whose applications were made on or after 1 December 2020.

If you have any queries on the updated guidance changes and how to comply, please contact a member of our Immigration Team.

Related Item(s): Immigration & Global Mobility

Author(s)/Speaker(s): Andrew Osborne, Stephen OFlaherty, Naomi Hanrahan-Soar, Joanna Hunt,

These FAQs look at the considerations for employers whose staff are working from home during the pandemic.

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On 22 February, the Prime Minister announced a new four step plan to ease England’s lockdown (with Devolved Administrations setting out separate plans for Scotland, Wales and Northern Ireland). This COVID-19 Response, the government’s “roadmap out of lockdown”, will see restrictions start to lift against a series of indicative dates, with a minimum of five weeks between each step. New “steps” regulations came into effect on 29 March to implement the roadmap.

The “steps” regulations lift the lockdown restrictions on leaving home to go to the office if your job can be done from home. However, office workers are advised to carry on working from home for the time being if possible.

It is clear that working from home will continue to be the new normal for most office-based staff for some months to come.  These FAQs look at the various considerations that employers need to bear in mind in relation to employees working from home.

Should every office-based employee in England work from home?

With effect from 29 March, it is no longer be a criminal offence to leave home in order to go to the office if your job can be done from home. However, the latest guidance says that office workers should continue to work from home if they can, until at least step 4 of the roadmap (pencilled in for 21 June) unless home working is not appropriate because of mental or physical health difficulties, or a particularly challenging home working environment.

Although the stay at home order was lifted on 29 March, “gatherings” will remain heavily restricted. For more details, see Reopening offices – what do the new regulations say?

In practice, this means that, with effect from 29 March, solitary and independent working at the office is a matter of government guidance rather than legal requirement. However, in-person meetings at the office will be subject to severe legal restrictions. Employers may wish to open up their offices in a limited way for employees who are struggling with homeworking because of the impact on their mental or physical health or because their working environment at home is unsuitable. However, other employees should continue working from home.

For more details see our article on going back to the office – the latest guidance.

Health and safety

Do employers have health and safety duties to homeworkers?

Yes. Employers owe a duty to take steps that are reasonably necessary to ensure the health, safety and welfare of all their employees, and provide and maintain a safe system of work – including for employees working from home.

The UK’s workplace health and safety regulator, the Health and Safety Executive (HSE), has updated its homeworking guidance to take account of working arrangements during the  Covid-19 pandemic.

Acas has also published guidance on working from home which can be accessed here.

Do employers need to carry out a risk assessment for those working from home?

The short answer is yes.  However, the exact nature of the assessment will depend on the type of work which is being undertaken at home.

Under the Health and Safety Act 1974 and the Management of Health and Safety at Work Regulations 1999, employers have a general duty to conduct a risk assessment of all the work activities carried out by their employees. This involves identifying any hazards and assessing associated risks.  Employers must take measures to remove any hazards or, where this is not reasonably practicable, to minimise the associated risks. There are also specific obligations in relation to the use of display screen equipment (see below).

The duty of care which employers owe to employees also apply to those working from home. In these exceptionally challenging times, however, employers are unlikely to be required to approach things in the usual way – not least, because it isn’t currently possible for them to visit employees’ homes. Guidance issued by the HSE on regulating occupational health during the coronavirus outbreak says that it will continue to take a flexible and proportionate account of the risks and challenges arising from the pandemic.

At the very least, employers ought to undertake a basic homeworking risk assessment and consider whether there are any risks which arise from the type of work which is being undertaken from home, whether it can be done safely and whether any measures ought to be put in place to protect employees from any risks identified.  For employees whose work is largely on computers and the telephone the risks are likely to include feelings of isolation, a lack of supervision, physical issues arising from prolonged use of display screen equipment and working long hours and/or inadequate breaks from work.  Employers should go on to consider whether they can implement any measures to minimise the impact of these risks. For example:

• Check that each employee feels the work they are being asked to do at home can be done safely.

• Ensure adequate supervision of junior or less experienced staff members, including new joiners.

• Keep in touch with lone workers, including those working from home, and ensure regular contact to make sure they are healthy and safe. There will always be greater risks for lone workers with no direct supervision, or anyone to help them if things go wrong. This is especially important for new joiners who may struggle to feel integrated.

• Establish clear expectations on both sides in relation to communications, working hours, availability and so on.

• Ensure employees have avenues to report mental wellbeing issues and schedule regular check-ins with homeworkers. In our survey, over a quarter (27%) of employers said that they had seen a significant increase in mental health problems for employees who have been able to work from home. We have produced a helpful guide to wellbeing while working from home and Acas has produced guidance on spotting and handling mental health in the context of homeworking and furlough.

Are there particular obligations where employees are using laptops and computers at home?

The Health and Safety (Display Screen Equipment) Regulations 1992 contain specific obligations in relation to display screen equipment (DSE). Employers must:

• Identify risks for individuals who regularly use DSE, including laptops used for prolonged periods, as a significant part of their usual work. (HSE guidance suggests this means daily usage for continuous periods of an hour or more.)

• Reduce the risks identified to the lowest extent reasonably practicable.

• Provide adequate training and information to employees.

HSE guidance on protecting homeworkers states that there is no increased risk from DSE for those working from home temporarily, so employers are not expected to undertake a full home workstation assessment. Nonetheless, it would be advisable to provide guidance and information on health and safety risks arising from homeworking and to ask employees to assess risk in general terms (including in relation to DSE related problems). The HSE provides a useful checklist which can be given to the employee. Employers should keep the situation under review, since the adverse effects of homeworking with a sub-optimal set up will increase the longer the period of homeworking continues.

For employees working from home on a long-term basis, the risks of using DSE must be controlled by them doing a workplace assessment at home. It remains to be seen whether, as homeworking continues on a widespread basis, the HSE’s position will move towards requiring full workstation assessments for all employees working from home for Covid-related reasons. Given that many employees will have been working at home for over 6 months, it is prudent to provide guidance and support to employees so that they can undertake a workstation assessment. Certainly, those employers moving to a model of permanent remote working for the long-term, regardless of the pandemic, will need to carry out a suitable risk assessment.

What health and safety duties do companies (or “end-users”) have towards temporary or agency workers carrying out work for them at home?

The situation has become more complex in relation to temporary or agency workers during the pandemic, where they are working under the control of the end-user but not at the end-user’s premises. In short, agency workers should be provided with the same level of health and safety protection as employees.

Broadly speaking, the end-user has responsibility for ensuring the health and safety of the agency worker while the individual is working under their control, while the intermediary (e.g. the agency) has the duty to ensure that the end-user has taken steps to ensure the health and safety of the workers. 

Where there are multiple intermediaries (e.g. agencies or umbrella companies) involved in an engagement, or the possibility of multiple workplaces, the parties should agree who will take responsibility for which actions. End-users are encouraged to engage in active communication with all parties to ensure no-one’s health and safety is compromised.

Provision of equipment and expenses

Do employers need to provide homeworkers with equipment to use at home?

There is no general legal obligation on employers to provide the equipment necessary for homeworking.

In guidance issued during the first lockdown, the government encouraged employers to take every step possible to facilitate their employees working from home, including providing suitable IT and equipment to enable remote working. Some employers have developed systems to allow employees to take equipment from the office to satisfy this shorter-term need. Some employers are providing a (generally fixed sum) budget to employees to buy necessary work equipment for working at home, so long as receipts are provided.

Employers should provide equipment or flexibility for employees who are identified as being at risk. In circumstances where equipment is specifically needed to address health and safety concerns, employers are liable to fund the cost of that equipment (and possibly have a role in selecting it).

Disabled employees may be entitled to auxiliary aids as a reasonable adjustment under the Equality Act 2020. If such an aid is reasonably needed, the employer needs to make sure it is provided – at its expense – to the individual when working from home.

Employers and employees should review their respective insurance policies to ensure work equipment used at home is covered.

There is no income tax or NICs charge where an employer provides office equipment for employees working from home under a formal homeworking arrangement if certain conditions are satisfied, including that the property remains the employers and that there is no significant private use of the equipment. 

HMRC has updated its tax rules for employers who cover the expense of providing or reimbursing the cost of homeworking equipment for employers working at home due to coronavirus. Detailed guidance can be found here.

Who is responsible for paying any additional homeworking expenses?

Employees will be using their own heating, lighting, broadband and sometime phone lines while working from home but it will be challenging to quantify the amount used for work purposes. Employers are not legally required to reimburse employees for such costs, but they may find themselves under pressure to allow for employees to reclaim some of these expenses. Employers that decide to meet (a proportion of) these costs should review expenses policies to cover this.

If an employer decides to reimburse employees for the additional costs which the employee incurs while working at home under a formal working arrangement, the employer may pay up to £6 per week (£4 per week prior to 6 April 2020) free of income tax and NICs without the need to see receipts or records of expenditure.  If the employer decides to pay more than the £6 per week it will need to either: (i) show that it is reimbursing the actual costs incurred by the employee; or (ii) ensure that the excess above £6 per week is subject to income tax and NICs. The exemption is only available for additional costs and, for example, would not include internet/broadband charges which the employee was paying for prior to working from home under a formal arrangement.

Is there any tax relief available to employees in relation to office equipment and additional expenses?

Some assistance from HMRC is available in respect of both equipment and expenses. HMRC guidance states that payment or reimbursement to employees of up to £6 a week is non-taxable for expenses like electricity, heating or broadband incurred by an employer when an employee is working from home. Further guidance can be found here.

Employees can also claim tax relief if they are paying for these expenses, although they should not claim where their employer is covering the relevant expenses – see here.

Data protection and confidentiality

How should we manage the increased risk to data protection and confidentiality created by homeworking?

Information security and confidentiality are more difficult to manage where employees are hosting calls and meetings at home with others in earshot, or without the usual office systems in place for securing devices and documents. However, the normal duties to protect employer and client confidential information apply even when employees are working from home.

Employers should set out employees’ responsibilities in their homeworking policy (see below) and ensure that employees have adequate means of protecting information. For example, employers should be satisfied of the security of devices and software employees are using (e.g. the security levels of video-calling software and services). Care should be taken in choosing a secure platform that complies with your security requirements.

The Information Commissioner’s Office has produced guidance on the data protection aspects of working from home.

Employees work from home – can we monitor them?

One of the issues which was traditionally raised by employers about homeworking was how best to monitor productivity or quality of output and enable effective supervision. Some employers, out of concern that employees are not managing to “switch off”, might also wish to know what hours employees are working.

Even when employees are working from home, employers still need to comply with duties to ensure rest breaks and other working time obligations. Some employers have adopted technology such as “lone worker apps” through which employees check-in on the app at the beginning of the day and check out at the end of each day.

Employers can monitor employees’ work activities, but the level of monitoring needs to be proportionate and reasonable – discussed further below.

What does an employer need to take into account when considering monitoring?

There is no statutory right to privacy in the UK but this does not mean that an employer has unrestricted monitoring rights. Inappropriate and disproportionate monitoring could lead to claims involving the employees’ right to respect for private life under Article 8 of the European Convention on Human Rights (incorporated into UK law by the Human Rights Act 1998). Employees also have data protection rights and can potentially claim that excessive monitoring amounts to a breach of the duty of mutual trust and confidence implied into all employment contracts – this may give qualifying employees a claim for unfair constructive dismissal.

In relation to data protection, the Information Commissioner’s Office’s employment practices code contains good practice guidance for employers in this area. In summary, employers should:

• Complete a privacy impact assessment setting out the purposes of the monitoring, the adverse impact on data subjects, the mitigation and its justification.

• Inform employees of the monitoring that is being undertaken, and the reasons why it has been adopted.

• If sensitive data is being processed, ensure that a legal basis for such processing is being met.

• Limit the number of people who have access to the software and ensure that they are properly trained in confidentiality and data security.

• Not use covert monitoring except in the most extreme circumstances (e.g. where criminal activity or similar is suspected).

Employers will need to weigh the perceived benefits to the business of monitoring, with the potential impact on morale, employee relations and mental health, which may ultimately lead to a deterioration in productivity. For a more in-depth discussion of these issues, please see our article.

Amending employment documentation

Should we amend existing employee’s contracts to reflect homeworking status?

Until the pandemic, homeworking was generally considered to be a non-standard, flexible working arrangement, where the “default” work location was the employer’s premises. Of course, employees have been working from home during the pandemic out of necessity rather than by choice, and the formalised flexible working request regime has to some extent fallen by the wayside (at least temporarily).

Employers may, however, wish to think about whether home working (or other flexible) arrangements need to be formalised in certain cases. Full or partial homeworking may have become a preference for many employees and many employers are considering reducing the office footprint in the longer-term. Even in July our employer surveyshowed that employers were already having to manage requests for permanent change. To claim the tax and NICs exemptions and reliefs there needs to be a formal home working arrangement in place between the employer and employee under which the employee must work at home regularly, so it is good to record this in writing.

Where contracts are amended to reflect the employee’s home as the place of work, employers will need to retain some flexibility to deal with some of the practicalities. For example, requiring employees to attend the office (for training, appraisals or disciplinary issues) and dealing with how expenses for travel to and from the office should be met. If an employee moves house, this may mean higher travel expense claims or a practical barrier to attending work at the office so employers could consider placing limits on how far an employee can move from a particular location. Employers may also want to retain the flexibility to alter the arrangement temporarily and consider making agreement to homeworking conditional on certain conditions being met, such as satisfactory performance being maintained.

While the uncertainty continues, employers may decide to keep homeworking under review until a definitive return to the office is possible. If so, you should continue to make clear that homeworking is, for the moment, a response to an exceptional situation, and that once a more comprehensive return to the office is anticipated, employees may make flexible working requests if they wish to work from home on a more permanent basis. These can be considered on a case-by case-basis. For more on this topic, please see our article.

Some employers have received requests from employees asking if they can work from “home” for an extended period overseas. Employers need to consider a variety of issues (including tax, social security, immigration and employment implications) before agreeing to any such request where “home” is not the UK. You can find out more on these issues in our article here.

What is the position for new starters who begin employment as homeworkers?

While recruitment activity has slowed down in many businesses, it has not stopped completely. Employers may wish to consider whether new recruits should be employed on a “working from home” basis from the outset, rather than stating a work location in the contract which they will not attend for some time to come.

Location clauses included in contracts can be drafted to state that the work should be performed from home initially, with a move to the office once it is safe and appropriate to do so. Additional obligations could also be included in contracts for new starters regarding access to an internet connection and other communication methods. Employers may also need to provide equipment (e.g. laptop, mobile phone) to individuals who would not normally be provided with these in their job role.

Should we amend existing policies or handbooks?

Many employers are currently reviewing how existing sickness, data and IT, disciplinary and grievance and benefit policies are impacted by a shift to homeworking.

Regarding sickness and absence policies, the Health Protection (Coronavirus, Restrictions) (Self-Isolation) (England) Regulations 2020 came into force on 28 September 2020. These make it a criminal offence, where an employer is aware that a worker is required to self-isolate, to allow the employee to attend work. In view of the range of circumstances in which employees may be absent from work due to the pandemic, it would be prudent to amend policies to allow for these potential temporary homeworking and Covid-related absences.

Regarding data and IT, it would be sensible to address data and information security issues related to working remotely, together with any need to address monitoring or other new ways in which personal data is being processed due to use of remote-working software.

Regarding disciplinary and grievance policies, employees working from home may no longer be able to attend in-person meetings for disciplinary and grievance procedures and the normal timelines for dealing with issues may need to be altered accordingly. Policies should be updated to ensure a fair procedure for both office workers and homeworkers.

As mentioned above, many employers are either updating or implementing homeworking policies, which draw together many of the areas mentioned above into a single document.

Employee benefits

How could homeworking impact employee benefits?

Some benefits have been used by employees in ways that are specific to their office location and may need to be reconsidered.

Homeworkers are unlikely to be using their commuter season tickets, which may have been purchased via an employer loan, and in many cases employees will already have claimed refunds where possible depending on the provider. Loan arrangements should be discussed and reviewed with the employee directly.

Other benefits may be specific to an office location – for example, subsidised or on-site childcare, gym membership, food. There may be alternative ways of helping employees in the longer term while they work from home, such as supporting them to access their tax-free childcare entitlement, providing occasional food vouchers or reimbursing the cost of attendance at local fitness classes as opposed to a city-centre gym. The provision of such alternative benefits may result in an income tax and/or NICs liability so employer would need to bear this in mind and seek appropriate advice.

Diversity and inclusion

How do we ensure that homeworking doesn’t disadvantage certain groups?

Homeworking may have its advantages for many employees, but employers should be cautious about whether homeworking has the practical effect of disadvantaging certain groups.

This may, for example, occur because of a lack of access to internet in rural areas, shared accommodation, disability, caring responsibilities, financial issues or other individual circumstances. Diversity and inclusion policies extend to homeworking and employers should invite and encourage employees to make any disadvantages known in order that reasonable steps can be taken to remove or reduce them.

As mentioned above, disabled employees may be entitled to auxiliary aids as a reasonable adjustment under the Equality Act 2010. If such an aid is reasonably needed, the employer needs to make sure it is provided – at its expense – to the individual when working from home.

 

Related Item(s): Employment, Covid 19 – Coronavirus, Occupational Health & Safety

Author(s)/Speaker(s): Abi Frederick, Annabel Lindsay,

The Home Office has provided UK employers with further details about what actions they may take when checking the right to work of EEA nationals and their family members during the post-transition grace period from 1 January 2021 to 30 June 2021.

Text:

Topics covered include checking right to work documentation issued under the Immigration Rules and carrying out retrospective right to work checks for existing employees.

The guidance is contained in an updated version of An employer’s guide to right to work checks, which was published on 17 March 2021. Points to note include the following:

• There is now an acknowledgement from the Home Office that employers may want to ensure the stability of their workforce during the grace period, and to help employees to obtain the appropriate immigration status they need to be able to work in the UK beyond the grace period

• Employers are advised that they may invite individuals who have been granted status under the EU Settlement Scheme or the post-Brexit immigration system to evidence their right to work using the Home Office online service, but during the grace period they cannot insist that an individual proves their right to work using the online service

• Employers are not required, but are allowed, to carry out retrospective right to work checks on existing EEA national/EEA family member employees, as long as these are conducted in a non-discriminatory way in accordance with the requirements of the Home Office’s Code of practice on avoiding unlawful discrimination while preventing illegal working

• If an EEA national (or presumably their family member, although this is not stated in the guidance) cannot provide documents in a retrospective check to the standard required to establish a statutory excuse, the employer is advised to contact the Employer Checking Service

• From 1 July 2021 the requirements for right to work checks for EEA nationals will change, and evidence of UK immigration status will be required using the Home Office’s online service, subject to limited exceptions

• New guidance on the requirements for right to work checks from 1 July 2021 will be published by the Home Office ahead of this date

For further information carrying out right to work checks for EEA nationals and their family members during the grace period, please see our previous webinar and FAQ, or contact a member of our Immigration Team.

Related Item(s): Immigration & Global Mobility

Author(s)/Speaker(s): Andrew Osborne, Li Xiang, Tom McEvoy,

The Home Office has provided UK employers with further details about what actions they may take when checking the right to work of EEA nationals and their family members during the post-transition grace period from 1 January 2021 to 30 June 2021.

Text:

Topics covered include checking right to work documentation issued under the Immigration Rules and carrying out retrospective right to work checks for existing employees.

The guidance is contained in an updated version of An employer’s guide to right to work checks, which was published on 17 March 2021. Points to note include the following:

• There is now an acknowledgement from the Home Office that employers may want to ensure the stability of their workforce during the grace period, and to help employees to obtain the appropriate immigration status they need to be able to work in the UK beyond the grace period

• Employers are advised that they may invite individuals who have been granted status under the EU Settlement Scheme or the post-Brexit immigration system to evidence their right to work using the Home Office online service, but during the grace period they cannot insist that an individual proves their right to work using the online service

• Employers are not required, but are allowed, to carry out retrospective right to work checks on existing EEA national/EEA family member employees, as long as these are conducted in a non-discriminatory way in accordance with the requirements of the Home Office’s Code of practice on avoiding unlawful discrimination while preventing illegal working

• If an EEA national (or presumably their family member, although this is not stated in the guidance) cannot provide documents in a retrospective check to the standard required to establish a statutory excuse, the employer is advised to contact the Employer Checking Service

• From 1 July 2021 the requirements for right to work checks for EEA nationals will change, and evidence of UK immigration status will be required using the Home Office’s online service, subject to limited exceptions

• New guidance on the requirements for right to work checks from 1 July 2021 will be published by the Home Office ahead of this date

For further information carrying out right to work checks for EEA nationals and their family members during the grace period, please see our previous webinar and FAQ, or contact a member of our Immigration Team.

Related Item(s): Immigration & Global Mobility

Author(s)/Speaker(s): Andrew Osborne, Li Xiang, Tom McEvoy,

The Home Office is launching a new Graduate route from 1 July 2021 and is making amendments to Skilled Worker route from 6 April 2021

Text:

These include changes to the shortage occupation list, eligible occupations, salary calculation rules and compliance requirements where a salary is reduced.

These changes are set out in Statement of Changes in Immigration Rules HC 1248, which was published on 4 March 2021. We share our views on the implications of the main changes below, as well as flagging other changes most likely to be of interest to employers.

Graduate route

From 1 July 2021 international students who have successfully completed an eligible qualification as a Student (including Tier 4 student) after a period of physically studying in the UK will be able to apply in-country for further permission to stay under a new Graduate route. Successful applicants will be granted immigration permission for three years if they completed a PhD or other doctorate, or two years for any other eligible qualification.

Interestingly, the list of eligible qualifications for the Graduate route is broader than those recognised for eligibility under the new entrant requirements for Skilled Worker, and includes the following:

• UK bachelor or UK post-graduate degree

• Law conversion course valid in England and Wales

• Legal Practice Course (LPC) or equivalent

• Bar Practice Course or equivalent

• Foundation programme in medicine or dentistry

• Postgraduate Certificate in Education (PGCE) or Postgraduate Diploma in Education (PGDE)

• Professional course requiring study at UK bachelor level or above in a profession with reserved activities regulated by UK law or a UK public authority

The implication of this discrepancy is that unless a Student is eligible to apply under the Skilled Worker route as a new entrant on a basis other than their completed UK studies, they may need to switch into the Graduate route and then into Skilled Worker in order to start the clock running towards settlement based on the lower salary threshold for new entrants.

Graduate route migrants will be allowed to undertake any work at any skill level, and to study in the UK provided this is not on a course that would normally require sponsorship as a Student. They will also be able to apply under the Skilled Worker route using the new entrant tradeable points criteria if they apply within two years of holding immigration permission under the Graduate route, noting that time spent in the Graduate route will count towards the four year maximum time that a person can hold immigration permission as a new entrant.

Time spent in the Graduate route will not be counted towards settlement other than based on ten years continuous lawful residence in the UK.

Graduate route migrants will be allowed to be accompanied by dependants, but only if the dependants were in the UK as the graduate’s Student dependant or born in the UK while the graduate had immigration permission as a student. There is no direct provision for child dependants born while the graduate has immigration permission under the Graduate route, which appears to be a drafting error. Unless such a provision is made in the future, they will need to apply under a general provision for children born in the UK to parents with limited immigration permission.

Skilled Worker route

Amendments are made to salary requirements, the Shortage Occupation List and occupations eligible for sponsorship for applications made from 6 April 2021.

Amendments to salary requirements – new £10.10 minimum hourly rate

A minimum hourly rate of £10.10 is being introduced for the route. This equates to the hourly rate a person being paid an annual salary of £20,480 (the minimum general salary floor for the Skilled Worker route) would receive for a 39-hour week.

Employers who have assigned a Certificate of Sponsorship before 6 April 2021 that does not meet the new requirement will need to consider whether the related immigration application can be submitted on or before 5 April 2021. If it cannot, they will need to consider whether the salary and/or hours worked per week can be revised, and if appropriate, make the change using a sponsor note. The applicant will also need to be advised of any changes.

Individuals who have already  immigration permission based on a salary that does not comply with the new minimum hourly rate will be able to extend their immigration permission as a Skilled Worker at their existing hourly rate due to a transitional arrangement. However, the hourly rate will be applied at the point at which people who benefit from the transitional arrangement apply for settlement.

As a reminder, no discounts apply to the going rates that the applicant must be paid when applying for settlement as a Skilled Worker. This may mean that in order to qualify for settlement, some Skilled Workers, eg those who scored tradeable points based on a discounted going rate, will need to have their salary increased so that it meets all of the following:

• The general salary threshold applicable to them (£20,480/£23,040/£25,600);

• £10.10 per hour; and

• The full going rate for their role.

Amendments to salary requirements – Certain science and Higher education teaching roles

When the Skilled Worker route was introduced, the going rates for skilled occupations were reviewed, resulting in substantial increases in the going rate for the following Standard Occupation Classification (SOC) codes:

• 2113 Physical scientists

• 2119 Natural and social science professionals not elsewhere classified

• 2311 Higher education teaching professionals

A transitional arrangement is being made so that individuals who were last granted immigration permission under Tier 2 General in these SOC codes can extend their stay and settle in the UK on the basis of a table setting out lower going rates than apply to other Skilled Workers in the same occupations, provided they apply by 30 November 2026.

Amendments to Shortage Occupation List

The UK-wide Shortage Occupation list is being expanded for applications made on or after 6 April 2021, to include roles under the following health and care sector SOC codes:

• 1181 Health services and public health managers and directors

• 1242 Residential, day and domiciliary care managers and proprietors

• 3111 Laboratory technicians

• 6146 Senior care workers

• 2213 Pharmacists

• 2219 Health professionals not elsewhere classified

• 2221 Physiotherapists

• 6141 Nursing auxiliaries and assistants

 Secondary teaching professionals (SOC 2314) in modern foreign languages are also recognised as a shortage occupation and SOC 5434 Chefs are removed on the basis that they now qualify under the main Skilled Worker route and at a lower salary level than required on the Shortage Occupation List.

These changes partly adopt the recommendations made by the Migration Advisory Committee (MAC) in September last year, which the Home Office deferred acting on immediately due to uncertainty around the labour market effects of the COVID-19 pandemic.

Employers should note that to be eligible for 20 tradeable points due to the role being a recognised shortage occupation, the salary paid for individuals filling shortage occupations must still meet the £20,480 minimum salary threshold or 80% of the going rate for the role, whichever is higher. This is different from the previous position under Tier 2 General, where inclusion on the shortage occupation list automatically entitled the applicant to points. A potential trap is that the going rate for Band 3 healthcare occupations is £19,737 in England, Wales and Northern Ireland, so employers for these roles must ensure sponsored individuals are paid at least a basic salary of £20,480.

New occupations eligible for sponsorship

Deckhands on large (nine metre plus) fishing vessels and vent chick sexers have been made eligible for sponsorship, also following the MAC’s recommendations. In each case eligible workers must have at least three years’ relevant experience.

Salary reductions

A new compliance requirement is being added to require a Skilled Worker to make a fresh application if their salary is reduced but they claim that they still qualify for the route on the basis of scoring a different set of tradeable points than they were previously approved under. This will enable the Home Office to assess the individual’s eligibility for the different set of tradeable points.

Other changes of interest to employers

These include:

• Allowing veterinarians to rely on the English language assessment they passed for professional regulation to meet the English language requirement for sponsorship under the Skilled Worker route

• Re-implementing a transitional arrangement to allow intra-company transferees previously granted permission under the Immigration Rules in force before 6 April 2011, or as a work permit holder, to extend their stay under the Intra-Company Transfer route with no maximum cumulative period of immigration permission in this capacity

• Allowing holders of certain prestigious prizes such as Academy Awards, BAFTAs, Brit Awards, British Fashion Council Fashion Awards, Golden Globes, Grammy Awards, Nobel Prizes, OIivier Awards and Tony Awards to qualify for the route without needing an endorsement from an endorsing body, and for them toproceed to settlement after three years

• Confirming that at settlement stage, dependants in certain work routes are not required to meet an absence requirement of no more than 180 days per year for any periods of immigration permission they were granted before 11 January 2018 – this is more restrictive than the Rule which was inadvertently previously deleted, which covered periods of leave granted following an application made under the Rules in place before 11 January 2018

• Only counting time spent in the UK towards the maximum 14 days allowed between engagements for T5 Creative and Sporting workers

For further information on these changes and how they may affect you, please contact a member of our Immigration Team.

 

Related Item(s): Immigration & Global Mobility

Author(s)/Speaker(s): Andrew Osborne, Kathryn Denyer,

The Home Office is launching a new Graduate route from 1 July 2021 and is making amendments to Skilled Worker route from 6 April 2021

Text:

These include changes to the shortage occupation list, eligible occupations, salary calculation rules and compliance requirements where a salary is reduced.

These changes are set out in Statement of Changes in Immigration Rules HC 1248, which was published on 4 March 2021. We share our views on the implications of the main changes below, as well as flagging other changes most likely to be of interest to employers.

Graduate route

From 1 July 2021 international students who have successfully completed an eligible qualification as a Student (including Tier 4 student) after a period of physically studying in the UK will be able to apply in-country for further permission to stay under a new Graduate route. Successful applicants will be granted immigration permission for three years if they completed a PhD or other doctorate, or two years for any other eligible qualification.

Interestingly, the list of eligible qualifications for the Graduate route is broader than those recognised for eligibility under the new entrant requirements for Skilled Worker, and includes the following:

• UK bachelor or UK post-graduate degree

• Law conversion course valid in England and Wales

• Legal Practice Course (LPC) or equivalent

• Bar Practice Course or equivalent

• Foundation programme in medicine or dentistry

• Postgraduate Certificate in Education (PGCE) or Postgraduate Diploma in Education (PGDE)

• Professional course requiring study at UK bachelor level or above in a profession with reserved activities regulated by UK law or a UK public authority

The implication of this discrepancy is that unless a Student is eligible to apply under the Skilled Worker route as a new entrant on a basis other than their completed UK studies, they may need to switch into the Graduate route and then into Skilled Worker in order to start the clock running towards settlement based on the lower salary threshold for new entrants.

Graduate route migrants will be allowed to undertake any work at any skill level, and to study in the UK provided this is not on a course that would normally require sponsorship as a Student. They will also be able to apply under the Skilled Worker route using the new entrant tradeable points criteria if they apply within two years of holding immigration permission under the Graduate route, noting that time spent in the Graduate route will count towards the four year maximum time that a person can hold immigration permission as a new entrant.

Time spent in the Graduate route will not be counted towards settlement other than based on ten years continuous lawful residence in the UK.

Graduate route migrants will be allowed to be accompanied by dependants, but only if the dependants were in the UK as the graduate’s Student dependant or born in the UK while the graduate had immigration permission as a student. There is no direct provision for child dependants born while the graduate has immigration permission under the Graduate route, which appears to be a drafting error. Unless such a provision is made in the future, they will need to apply under a general provision for children born in the UK to parents with limited immigration permission.

Skilled Worker route

Amendments are made to salary requirements, the Shortage Occupation List and occupations eligible for sponsorship for applications made from 6 April 2021.

Amendments to salary requirements – new £10.10 minimum hourly rate

A minimum hourly rate of £10.10 is being introduced for the route. This equates to the hourly rate a person being paid an annual salary of £20,480 (the minimum general salary floor for the Skilled Worker route) would receive for a 39-hour week.

Employers who have assigned a Certificate of Sponsorship before 6 April 2021 that does not meet the new requirement will need to consider whether the related immigration application can be submitted on or before 5 April 2021. If it cannot, they will need to consider whether the salary and/or hours worked per week can be revised, and if appropriate, make the change using a sponsor note. The applicant will also need to be advised of any changes.

Individuals who have already  immigration permission based on a salary that does not comply with the new minimum hourly rate will be able to extend their immigration permission as a Skilled Worker at their existing hourly rate due to a transitional arrangement. However, the hourly rate will be applied at the point at which people who benefit from the transitional arrangement apply for settlement.

As a reminder, no discounts apply to the going rates that the applicant must be paid when applying for settlement as a Skilled Worker. This may mean that in order to qualify for settlement, some Skilled Workers, eg those who scored tradeable points based on a discounted going rate, will need to have their salary increased so that it meets all of the following:

• The general salary threshold applicable to them (£20,480/£23,040/£25,600);

• £10.10 per hour; and

• The full going rate for their role.

Amendments to salary requirements – Certain science and Higher education teaching roles

When the Skilled Worker route was introduced, the going rates for skilled occupations were reviewed, resulting in substantial increases in the going rate for the following Standard Occupation Classification (SOC) codes:

• 2113 Physical scientists

• 2119 Natural and social science professionals not elsewhere classified

• 2311 Higher education teaching professionals

A transitional arrangement is being made so that individuals who were last granted immigration permission under Tier 2 General in these SOC codes can extend their stay and settle in the UK on the basis of a table setting out lower going rates than apply to other Skilled Workers in the same occupations, provided they apply by 30 November 2026.

Amendments to Shortage Occupation List

The UK-wide Shortage Occupation list is being expanded for applications made on or after 6 April 2021, to include roles under the following health and care sector SOC codes:

• 1181 Health services and public health managers and directors

• 1242 Residential, day and domiciliary care managers and proprietors

• 3111 Laboratory technicians

• 6146 Senior care workers

• 2213 Pharmacists

• 2219 Health professionals not elsewhere classified

• 2221 Physiotherapists

• 6141 Nursing auxiliaries and assistants

 Secondary teaching professionals (SOC 2314) in modern foreign languages are also recognised as a shortage occupation and SOC 5434 Chefs are removed on the basis that they now qualify under the main Skilled Worker route and at a lower salary level than required on the Shortage Occupation List.

These changes partly adopt the recommendations made by the Migration Advisory Committee (MAC) in September last year, which the Home Office deferred acting on immediately due to uncertainty around the labour market effects of the COVID-19 pandemic.

Employers should note that to be eligible for 20 tradeable points due to the role being a recognised shortage occupation, the salary paid for individuals filling shortage occupations must still meet the £20,480 minimum salary threshold or 80% of the going rate for the role, whichever is higher. This is different from the previous position under Tier 2 General, where inclusion on the shortage occupation list automatically entitled the applicant to points. A potential trap is that the going rate for Band 3 healthcare occupations is £19,737 in England, Wales and Northern Ireland, so employers for these roles must ensure sponsored individuals are paid at least a basic salary of £20,480.

New occupations eligible for sponsorship

Deckhands on large (nine metre plus) fishing vessels and vent chick sexers have been made eligible for sponsorship, also following the MAC’s recommendations. In each case eligible workers must have at least three years’ relevant experience.

Salary reductions

A new compliance requirement is being added to require a Skilled Worker to make a fresh application if their salary is reduced but they claim that they still qualify for the route on the basis of scoring a different set of tradeable points than they were previously approved under. This will enable the Home Office to assess the individual’s eligibility for the different set of tradeable points.

Other changes of interest to employers

These include:

• Allowing veterinarians to rely on the English language assessment they passed for professional regulation to meet the English language requirement for sponsorship under the Skilled Worker route

• Re-implementing a transitional arrangement to allow intra-company transferees previously granted permission under the Immigration Rules in force before 6 April 2011, or as a work permit holder, to extend their stay under the Intra-Company Transfer route with no maximum cumulative period of immigration permission in this capacity

• Allowing holders of certain prestigious prizes such as Academy Awards, BAFTAs, Brit Awards, British Fashion Council Fashion Awards, Golden Globes, Grammy Awards, Nobel Prizes, OIivier Awards and Tony Awards to qualify for the route without needing an endorsement from an endorsing body, and for them toproceed to settlement after three years

• Confirming that at settlement stage, dependants in certain work routes are not required to meet an absence requirement of no more than 180 days per year for any periods of immigration permission they were granted before 11 January 2018 – this is more restrictive than the Rule which was inadvertently previously deleted, which covered periods of leave granted following an application made under the Rules in place before 11 January 2018

• Only counting time spent in the UK towards the maximum 14 days allowed between engagements for T5 Creative and Sporting workers

For further information on these changes and how they may affect you, please contact a member of our Immigration Team.

 

Related Item(s): Immigration & Global Mobility

Author(s)/Speaker(s): Andrew Osborne, Kathryn Denyer,

The final instalment of our three-part series of articles exploring resourcing challenges, opportunities and trends in 2021 examines a range of employment issues including reward strategy, outsourcing and collective representation.

Text:

The first article in our series explored some of the immediate options for responding to the challenges of the pandemic, including government support packages, restructuring, changing terms and alternative contracting options. Our second article looked at the trend towards homeworking and other flexible working arrangements and the growing focus on wellbeing, trust and culture as key to recruiting and retaining staff.

In this final article, we share our thoughts on how the current situation is impacting a range of employment-related areas, from post-termination restrictions and reward packages through to outsourcing and collective representation. We also consider how the impact of Brexit may drive employers to consider new resourcing options.

Retaining and incentivising key staff

In economically uncertain times, retaining experienced and proficient employees becomes even more critical for employers. Those which can retain effective and knowledgeable members of staff will stand a better chance than others of continuing to deliver for their customers and clients, and thereby weathering the economic storm. Training and upskilling employees involves significant cost – an investment that will be lost if you cannot retain highly skilled employees. Most likely, a competitor will benefit from your investment instead, particularly if the skills are scarce and so highly valued.

Most employers will adopt a “carrot and stick” approach in order to encourage employees to stay, while safeguarding key interests in the event they choose to leave. 

Until now, the “carrot” has generally been inward-looking, in terms of ensuring an attractive remuneration package. This includes not only salary, benefits and annual bonuses, but also long-term incentive plans (LTIPs) to incentivise loyalty and performance on a more longstanding basis (see our article on long-term employee incentive plans in a recession). Businesses will need to navigate between retaining and motivating key staff and keeping a tight control on cost, so it remains important to ensure remuneration packages are as tax effective as possible.

We have recently seen employers moving away from investing in the pure financial package and instead looking at reward in a more holistic way – including, for example, health and wellbeing related benefits. (This increasing focus on wellbeing, trust and culture, was discussed in the second articlein our series.)

The “stick” approach is likely to involve the inclusion of carefully considered and well-drafted restrictive covenants in employment contracts. In some cases, the purpose of such post-termination restraints is to prevent an employee being able to leave and immediately join a competing business. In other situations, the prime purpose is to manage the commercial risk of an employee leaving – for example, by preventing them from soliciting certain clients, customers or other employees for a set period.

Where long-serving employees are concerned, it is a common scenario that their restrictions have not been reviewed and amended they have been promoted and/or their role has evolved. As that can lead to challenges with enforcement, it is important regularly to review the restrictions of key employees to ensure that they are up to date and relevant to the role the individual undertakes. (See our article on the impact of coronavirus on post-termination restrictions.)

The government has recently launched a consultation on reform of non-compete clauses, observing that Covid-19 has had a “profound impact on the labour market”, creating a need to boost innovation, increase competition and create new jobs. If the government legislates to require employers to pay for non-compete clauses, this could result in a benefit for employers (albeit with a price tag) as it may drive up compliance with this sort of contractual restraint.

Outsourcing, onshoring and disposals

The need to maintain certain outsourced functions has dwindled, especially where offices have been closed, staff footfall has reduced dramatically and/or supply chains and orders have been disrupted. This is leading to the renegotiation of outsourcing contracts, and in some cases their termination, alongside discussions over which party will bear the costs of redundancies arising from reduced service levels. We are increasingly being asked to advise on disputes in this area.

Meanwhile, there is a focus on insourcing, as well as outsourcing. The trend of outsourcing to lower-cost countries was beginning to reverse even before the pandemic, with more companies reported to have started onshoring production. The combined impact of Brexit and the pandemic may accelerate this trend as companies seek to increase their agility, reduce lead times and protect their supply chains. Onshoring can also form part of the responsible business agenda, as companies move to take greater control over labour standards and environmental impact.

At the same time, some companies are continuing to hive-off and dispose of certain activities in order to raise capital or refocus the business on account of significantly changed circumstances. From a buyer’s perspective, this potentially creates opportunities for advantageous deals.

We therefore expect the combined impacts of Covid-19 and Brexit to be felt in various ways in this area throughout 2021.

The rise of collective representation?

The Covid pandemic has meant that many employers have had to engage in a collective redundancy consultation for the first time. Some of those had not previously set up an employee forum, or else had established one with such an informal and limited remit that it was insufficient to make it a “standing body” with which they could engage for this purpose. In contrast, other employers have benefited from having already created a more substantive body. Almost as a by-product, this has enabled them quickly to engage with experienced representatives, rather than delaying consultation to allow employees first to elect who should represent them.

In most cases, employers who were reluctant to consider collective forums have found them to be very useful. In many cases, employers have engaged with them more regularly and extensively than they had originally contemplated and intend to continue doing so as they look to transform resourcing for the post-Covid future.

This may therefore be an opportune time for employers who have not yet gone down this road to consider whether a standing body for collective consultation would be helpful and, if so, what form it should take and what remit it should have. In particular, it would be sensible to consider whether any new forum should have a sufficiently strong remit to engage in consultation “with a view to reaching agreement”, as must take place in the context not only of collective redundancies but also TUPE transfers involving measures.

Last year’s exceptional events have also led to an increase in trade union membership. This coincided with a lowering of the thresholds for requesting a statutory information and consultation body that can legally enforce its rights at the Central Arbitration Committee. Putting in place an appropriately tailored forum might assist employers in resisting moves by unions seeking to interfere in their direct relationships with their own employees. It could thereby help to allow employee relations to continue developing other than under the “shadow of the law” and potential legal complaints.

The impact of Brexit

Brexit is another factor raising major resourcing issues unlike anything employers had to contend with before. Although the UK and EU reached a last-minute trade deal, this does not replicate all of the business advantages of being in the single market. Some firms will be looking to set up an EU base (in Ireland, for example), meaning that some UK employees may be required to relocate. Other employees may ask to relocate to new or existing operations within the EU.

The new immigration system in place from January 2021 is going to make it much more expensive to bring EEA or Swiss workers into the UK, which could have a significant impact on the UK labour market. Employers that agreed temporary overseas remote-working arrangements with employees stuck abroad in the early months of the pandemic are now beginning to consider whether they could rely on remote workers carrying out their role from their home country, without ever needing to work in the UK (an issue we explored in the second article in our series).

Labour market changes brought about by Brexit are also likely to result in employers falling back on some of the more flexible alternative contracting options discussed in the first article in our series.

A final thought

While the combined effect of the Covid-19 pandemic and Brexit is creating unprecedented resourcing challenges for business, there are nonetheless numerous opportunities for employers to exploit. These include changing terms or using alternative contracting options, embracing agile working and initiatives on wellbeing, trust and culture, and reviewing reward packages, post-termination restrictions and collective representation structures (as discussed above).

Above all, this is a moment to be proactive and reassess traditional workplace models and outdated approaches to employment relations. That’s the key to helping protect your business and make it sufficiently adaptable and resilient to withstand whatever might be coming next.

Related Item(s): Employment, Tax, Rewards & Incentives, Cash Plans & Incentives, Trade Unions & Works Councils, BREXIT, Resourcing for 2021 and beyond, Outsourcing, onshoring and disposals, Retaining and incentivising staff, Collective representation

Author(s)/Speaker(s): Lucy Lewis, Lisa Dafydd, Gemma Taylor,

The final instalment of our three-part series of articles exploring resourcing challenges, opportunities and trends in 2021 examines a range of employment issues including reward strategy, outsourcing and collective representation.

Text:

The first article in our series explored some of the immediate options for responding to the challenges of the pandemic, including government support packages, restructuring, changing terms and alternative contracting options. Our second article looked at the trend towards homeworking and other flexible working arrangements and the growing focus on wellbeing, trust and culture as key to recruiting and retaining staff.

In this final article, we share our thoughts on how the current situation is impacting a range of employment-related areas, from post-termination restrictions and reward packages through to outsourcing and collective representation. We also consider how the impact of Brexit may drive employers to consider new resourcing options.

Retaining and incentivising key staff

In economically uncertain times, retaining experienced and proficient employees becomes even more critical for employers. Those which can retain effective and knowledgeable members of staff will stand a better chance than others of continuing to deliver for their customers and clients, and thereby weathering the economic storm. Training and upskilling employees involves significant cost – an investment that will be lost if you cannot retain highly skilled employees. Most likely, a competitor will benefit from your investment instead, particularly if the skills are scarce and so highly valued.

Most employers will adopt a “carrot and stick” approach in order to encourage employees to stay, while safeguarding key interests in the event they choose to leave. 

Until now, the “carrot” has generally been inward-looking, in terms of ensuring an attractive remuneration package. This includes not only salary, benefits and annual bonuses, but also long-term incentive plans (LTIPs) to incentivise loyalty and performance on a more longstanding basis (see our article on long-term employee incentive plans in a recession). Businesses will need to navigate between retaining and motivating key staff and keeping a tight control on cost, so it remains important to ensure remuneration packages are as tax effective as possible.

We have recently seen employers moving away from investing in the pure financial package and instead looking at reward in a more holistic way – including, for example, health and wellbeing related benefits. (This increasing focus on wellbeing, trust and culture, was discussed in the second article in our series.)

The “stick” approach is likely to involve the inclusion of carefully considered and well-drafted restrictive covenants in employment contracts. In some cases, the purpose of such post-termination restraints is to prevent an employee being able to leave and immediately join a competing business. In other situations, the prime purpose is to manage the commercial risk of an employee leaving – for example, by preventing them from soliciting certain clients, customers or other employees for a set period.

Where long-serving employees are concerned, it is a common scenario that their restrictions have not been reviewed and amended they have been promoted and/or their role has evolved. As that can lead to challenges with enforcement, it is important regularly to review the restrictions of key employees to ensure that they are up to date and relevant to the role the individual undertakes. (See our article on the impact of coronavirus on post-termination restrictions.)

The government has recently launched a consultation on reform of non-compete clauses, observing that Covid-19 has had a “profound impact on the labour market”, creating a need to boost innovation, increase competition and create new jobs. If the government legislates to require employers to pay for non-compete clauses, this could result in a benefit for employers (albeit with a price tag) as it may drive up compliance with this sort of contractual restraint.

Outsourcing, onshoring and disposals

The need to maintain certain outsourced functions has dwindled, especially where offices have been closed, staff footfall has reduced dramatically and/or supply chains and orders have been disrupted. This is leading to the renegotiation of outsourcing contracts, and in some cases their termination, alongside discussions over which party will bear the costs of redundancies arising from reduced service levels. We are increasingly being asked to advise on disputes in this area.

Meanwhile, there is a focus on insourcing, as well as outsourcing. The trend of outsourcing to lower-cost countries was beginning to reverse even before the pandemic, with more companies reported to have started onshoring production. The combined impact of Brexit and the pandemic may accelerate this trend as companies seek to increase their agility, reduce lead times and protect their supply chains. Onshoring can also form part of the responsible business agenda, as companies move to take greater control over labour standards and environmental impact.

At the same time, some companies are continuing to hive-off and dispose of certain activities in order to raise capital or refocus the business on account of significantly changed circumstances. From a buyer’s perspective, this potentially creates opportunities for advantageous deals.

We therefore expect the combined impacts of Covid-19 and Brexit to be felt in various ways in this area throughout 2021.

The rise of collective representation?

The Covid pandemic has meant that many employers have had to engage in a collective redundancy consultation for the first time. Some of those had not previously set up an employee forum, or else had established one with such an informal and limited remit that it was insufficient to make it a “standing body” with which they could engage for this purpose. In contrast, other employers have benefited from having already created a more substantive body. Almost as a by-product, this has enabled them quickly to engage with experienced representatives, rather than delaying consultation to allow employees first to elect who should represent them.

In most cases, employers who were reluctant to consider collective forums have found them to be very useful. In many cases, employers have engaged with them more regularly and extensively than they had originally contemplated and intend to continue doing so as they look to transform resourcing for the post-Covid future.

This may therefore be an opportune time for employers who have not yet gone down this road to consider whether a standing body for collective consultation would be helpful and, if so, what form it should take and what remit it should have. In particular, it would be sensible to consider whether any new forum should have a sufficiently strong remit to engage in consultation “with a view to reaching agreement”, as must take place in the context not only of collective redundancies but also TUPE transfers involving measures.

Last year’s exceptional events have also led to an increase in trade union membership. This coincided with a lowering of the thresholds for requesting a statutory information and consultation body that can legally enforce its rights at the Central Arbitration Committee. Putting in place an appropriately tailored forum might assist employers in resisting moves by unions seeking to interfere in their direct relationships with their own employees. It could thereby help to allow employee relations to continue developing other than under the “shadow of the law” and potential legal complaints.

The impact of Brexit

Brexit is another factor raising major resourcing issues unlike anything employers had to contend with before. Although the UK and EU reached a last-minute trade deal, this does not replicate all of the business advantages of being in the single market. Some firms will be looking to set up an EU base (in Ireland, for example), meaning that some UK employees may be required to relocate. Other employees may ask to relocate to new or existing operations within the EU.

The new immigration system in place from January 2021 is going to make it much more expensive to bring EEA or Swiss workers into the UK, which could have a significant impact on the UK labour market. Employers that agreed temporary overseas remote-working arrangements with employees stuck abroad in the early months of the pandemic are now beginning to consider whether they could rely on remote workers carrying out their role from their home country, without ever needing to work in the UK (an issue we explored in the second article in our series).

Labour market changes brought about by Brexit are also likely to result in employers falling back on some of the more flexible alternative contracting options discussed in the first article in our series.

A final thought

While the combined effect of the Covid-19 pandemic and Brexit is creating unprecedented resourcing challenges for business, there are nonetheless numerous opportunities for employers to exploit. These include changing terms or using alternative contracting options, embracing agile working and initiatives on wellbeing, trust and culture, and reviewing reward packages, post-termination restrictions and collective representation structures (as discussed above).

Above all, this is a moment to be proactive and reassess traditional workplace models and outdated approaches to employment relations. That’s the key to helping protect your business and make it sufficiently adaptable and resilient to withstand whatever might be coming next.

Related Item(s): Employment, Tax, Rewards & Incentives, Cash Plans & Incentives, Trade Unions & Works Councils, BREXIT, Resourcing for 2021 and beyond, Outsourcing, onshoring and disposals, Retaining and incentivising staff, Collective representation

Author(s)/Speaker(s): Lucy Lewis, Lisa Dafydd, Gemma Taylor,

The furlough scheme may have been extended to 30 September 2021, but employers are looking ahead to cost-saving measures in the face of ongoing economic challenges.

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We set out below our answers to key questions about options for restructuring the workforce. These cover options for extending furlough, notice and redundancy payment rights during furlough, changing terms and conditions, and dealing with redundancies.

See also our FAQs for employers on the Coronavirus Job Retention Scheme for detailed information about furloughing employees.

There is more information about redundancies in our Inbrief guides on Redundancy and Collective redundancies.

Extending furlough even when the scheme ends

Can we keep employees on furlough even when the extended government scheme has ended?

Yes. The Coronavirus Job Retention Scheme created a form of agreed lay off even where there was no contractual lay-off provision. As a result, provided employees continue to agree to being on furlough, it would be possible to extend the period for they are furloughed. This could reduce pay below the current furlough grant, or even implement furlough on no pay. Employees may be willing to agree to this as an alternative to redundancy. However, you will no longer be able to reclaim salary or other wage costs from the furlough scheme after it has ended, which will of course limit its attractiveness.

If you have a contractual right to lay off without pay, this could be relied on (although such clauses in contracts are quite rare in practice). Lay-off provisions are subject to the implied term of trust and confidence which means, for example, that you should consult with employees first and give reasonable notice of any lay off to avoid being in breach of contract.

There are also specific statutory provisions which provide a right for employees who have been laid off for four or more consecutive weeks, or six weeks in any 13-week period, to claim a statutory redundancy payment in certain circumstances. However, the scheme requires employees to resign in order to receive their redundancy payment.

Changing terms and conditions

Can we reduce hours and pay for employees?

Yes, with employee agreement.

If you recognise a trade union for collective bargaining purposes, you may be able to agree the change with the union – depending on the terms of any collective agreement, this may either be binding on all employees or may at least facilitate individual agreement. If there is no union, individual employee consent should be obtained and evidenced in writing (absent clauses permitting you to impose unilateral reductions, which are extremely rare).

If you are seeking agreement before you have formulated any proposal to dismiss 20 or more employees, a collective redundancy consultation will not be triggered. This means that you must not have formulated a definite plan that is likely to result in dismissals if employees do not agree to the proposed change. If a proposal has already been formulated to dismiss as redundant anyone who does not agree, or to force the change through by dismissing and re-engaging if necessary, then collective consultation will arguably be triggered.

Alternatively, if there is a contractual right to impose short-time working this could be used (subject to consultation and notice).

Can we reduce pay for employees but require them to work the same hours?

Yes – the process is as set out above. It may be more difficult to persuade employees to agree to this. You will need to ensure you explain the rationale, reasons and business cost in detail to minimise employee discontent. You also need to ensure for low paid employees that, if their pay is reduced but their hours are not, you still continue to comply with minimum wage legislation.

What if an employee refuses to agree to the proposed change?

You will need to consult individually with the employee and attempt to explain the reasons and necessity for the proposed change. If the employee still refuses after additional time and further discussion, you will need to decide on whether to impose the change by dismissal and re-engagement on the new terms or adopt different measures. 

Dismissals in these circumstances can be fair, so long as there is a clear business necessity for the change and the employer has followed a fair process. Dismissal and re-engagement in this way will trigger collective consultation requirements where 20 or more dismissals are proposed.

Making redundancies

Is it unfair to make employees redundant while furlough is available?

Employees with two or more years’ service can claim unfair dismissal. Redundancy is a potentially fair reason for dismissal, but it must also be reasonable in the circumstances to dismiss for that reason. There is an argument that it is unfair to make employees redundant when the government-funded furlough scheme is available as an alternative.

However, furlough is not cost neutral for the employer. Even if employees agree to reduce their pay to the amount of the furlough grant, the employer needs to bear the costs of employer’s National Insurance Contributions, pension contributions, holiday pay top-ups and any other benefits unless the employee has agreed to waive them. In addition, employers will be required to contribute 10% of salary for furloughed employees in July 2021, and 20% of salary in August and September 2021.

Also, there remains a question mark over whether it might be contrary to the purposes of the furlough scheme to use the scheme purely to postpone redundancies that are inevitable, i.e. they are going to happen at the end of the scheme irrespective of other circumstances. The original furlough scheme was intended to help employers keep their employees attached to the business so that they could eventually resume active employment. It’s not entirely clear, if it is legitimate for employers to use the scheme to support individuals whose jobs only exist within the furlough scheme and are no longer thought to be viable. There is nothing in the guidance which explicitly says that employers cannot do this, but there is still a risk that it could be regarded as contrary to the purposes of the scheme.

For these reasons, while it is important for employers to consider the availability of the furlough scheme, we do not consider it is necessarily unfair to make employees redundant when furlough is available.

Can we reclaim notice pay under the government furlough scheme?

A payment in lieu of notice cannot be reclaimed under the scheme.

If an employee is “working out” their notice while on furlough, employers cannot claim for any day when an employee is serving statutory or contractual notice from 1 December 2020 onward. This means that the costs of notice pay after 1 December are no longer be covered by the scheme.

How would we calculate notice pay for an employee who is currently furloughed?

If you choose to make a payment in lieu of notice under a clause in the employment contract, you should check what the contract says about the amount. If, for example, it says that pay in lieu of notice should be calculated based on basic pay, this is likely to be interpreted as meaning pre-furlough pay.

If an employee who is currently furloughed is given notice which they are to “work out” (even if they are unable actually to perform work for you), the amount you need to pay them during the notice period can be complicated.

The government made special regulations in July 2020 to require the calculation of notice pay to be based on pre-furlough pay – see our article “New law on redundancy and notice pay for furloughed employees”. These regulations have been updated twice to reflect the extensions of the furlough scheme to 30 April 2021, and we expect they will be updated again to cover the period to 30 September 2021. These regulations effectively require employers to top-up pay to its pre-furlough rate for employees working out their notice if it is the statutory minimum period of notice or less than a week more than that period.

If an employee’s contractual notice period is at least a week more than the statutory minimum period of notice, no such top-up is automatically required. However, since for claim periods starting on or after 1 December 2020 you cannot make claims for employees for days during their notice periods, you should check your furlough agreement to determine their status in light of that and the rate of pay to which they are entitled as a result during their notice period.

How do we calculate statutory redundancy pay for employees on furlough?

Statutory redundancy payments are calculated based on years of service, age, and a week’s pay. For this purpose, a week’s pay is currently capped at £538. Many employees will earn more than this even during furlough, which will mean there is no need to consider a different calculation.

The government made special regulations in July 2020 to require the calculation of statutory redundancy pay to be based on pre-furlough pay – see our article “New law on redundancy and notice pay for furloughed employees”. These regulations have not yet been amended to cover the extension of the furlough scheme, but it seems highly likely that the government will make that amendment shortly.

Redundancy consultation during the pandemic

Do we need to collectively consult with our workforce?

It depends on the number of employees involved. Collective consultation is required where an employer proposes to dismiss 20 or more employees “at one establishment” in a 90-day period for a reason unrelated to the individual, which encompasses both “classic” redundancies and “fire and rehire” exercises aimed at imposing less favourable terms. If fewer than 20 redundancies are anticipated, only individual consultation is required. We always recommend taking advice on your particular circumstances before embarking on collective consultation.

For an explanation of what collective consultation involves, see our inbrief on collective redundancies.

Can we carry out individual and collective redundancy consultation during furlough?

Yes. The guidance does not explicitly state whether collective or individual redundancy consultation can be carried out during the furlough period, or whether it would fall under the prohibition on doing work. However, it is not making money for the employer or providing services, so is most likely permissible. The guidance for employers also says that employee representatives may undertake duties and activities for the purpose of individual or collective representation and that this will not be considered work, which strongly suggests that individual and collective consultation must also be allowed.

You are likely to want to commence collective consultation during furlough if you know that you are likely to need to make redundancies post-furlough. You may also wish to use the time employees spend on furlough to absorb part of the cost of the consultation process.

Can employee representatives be furloughed and continue in their role as a representative?

Yes, where the employee representative is only being consulted in respect of possible redundancies or other topics within their usual remit as an employee representative, such as health & safety. The guidance for employers says that employees who are union or non-union representatives may undertake duties and activities for the purpose of individual or collective representation of employees or other workers while they are on furlough – so long as they are not providing services or generating revenue. The representatives are not providing services to the employer, so this should not fall under the prohibition on doing work while on furlough. 

How do we collectively consult a workforce who are on furlough or remote working?

Coronavirus has created a situation where many employees are on furlough, working from home, self-isolating or practising social distancing. This makes collective consultation a challenge, as it would normally be done in person.

The flexible furlough option may allow some consultation to take place in person on days when employees are working. However, many employees will still be working from home and those on flexible furlough are likely to be in work at different times, meaning remote consultation will still be required even where some employees are attending the workplace.

Previous case law has shown that carrying out information and consultation obligations remotely is permissible, and it is unlikely that this would be regarded as a problem in the current, highly unusual circumstances.

Employers can make use of technology to hold online “town halls” to inform employees about proposed measures and prepare to run several of these to ensure the whole workforce is notified properly rather than via the grapevine.

Collective consultation with employee representatives could be done remotely provided appropriate technology is in place. It could also potentially be done in person with appropriate risk assessments and protective measures and subject to consideration of current government guidance.

If done remotely, you should make sure that all the representatives have the technology required to participate. You should also ensure that only relevant parties receive an invitation to the online meeting, and that the line or portal for hosting it is secure and compliant for data protection purposes. Set a clear protocol in advance about how the meeting will be run.

If employee representatives have not already been elected, employers will need to consider what arrangements they need to make to ensure any election is fair. This may include arranging online voting. The voting process is supposed to be secret so far as reasonably practicable, which can present a challenge when it cannot happen in the physical workplace. Some possible options are:

• Use a third-party online voting platform, which ensures anonymity but may come at a cost.

• Design your own internal system. For example, you could nominate one independent person to run the ballot – although strictly this would not then be a secret election.

• Set up a consultation body in advance, which (provided its mandate is sufficiently clear) can then be used for redundancy consultation later on.

How do we carry out individual consultation with employees who are on furlough or remote working?

First, you need to think about how you will contact your employees and how will you send them relevant paperwork. Do you have their home email addresses (if they no longer have access to office email or never had it), do you have a home/mobile telephone number, and do you know if the employees have access to a computer?

For people without access to a computer, you could post or courier documents. If individuals will be reading emailed documents on a smartphone, consider formatting issues and what type of document to send. 

If you propose to carry out the individual consultation meetings by video conferencing, check the employee (and, if applicable, any person accompanying them) will have access to a computer or smartphone. Alternatively, you can consult by conference call, but bear in mind that it will be harder to see how people are reacting to the news.  If someone is on flexible furlough and in the workplace for some of the time, consider whether some or all of the consultation can happen face-to-face (with appropriate social distancing) on days they are working.

It is a common practice to allow the employee to be accompanied at redundancy consultation meetings (and any appeal meeting) by a colleague or trade union representative, although this is not a statutory right. The furlough guidance for employers has confirmed that acting as an employee representative does not amount to “work”, so colleagues who are furloughed could still act as a companion without risking the furlough grant.

Although you are under no legal obligation to allow the employee to be accompanied by a friend or a family member, this may be allowed under your own policies and procedures or as a discretionary measure in these unusual circumstances. Check the wording of any redundancy policy for any such provisions. In practice, it will be difficult for you to ensure nobody else is present in the room while holding the meeting remotely (especially if this is by phone rather than videoconference) – so it might be sensible to allow a friend or family member to accompany the employee.

Think about the following:

• Ensure that only relevant parties receive an invitation to the online meeting, and that the line or online portal for hosting the meeting is secure and compliant for data protection purposes.

• Ask the employee to attend the virtual meeting from a private and quiet room if possible where they will not be disturbed, and discuss their particular circumstances with them.

• Ask parties to speak clearly, let them ask questions when necessary and confirm their understanding. Parties should be asked to mute themselves when they are not speaking to avoid any distractions. Make use of online tools, such as screen sharing, to refer to documents.

• Explain that you will be taking notes of the meeting and will share a copy of the minutes/notes with them. Remind them that they may also take their own notes during the meeting.

• At the start of the meeting, ask the employee to confirm that they (or any companion) are not recording the meeting. If you are concerned about this, remind them that they do not have a legal right to record the meeting and that this may be viewed as a breach of trust and confidence as well as misconduct. You could also explain that covert recording may be in breach of data protection legislation. (Remember, though, that recording may be a reasonable adjustment for someone with a physical or mental impairment.)

• During the meeting, check with the employee whether they need to take a break in the same way as you would during an in-person meeting.

• Allow employees time to speak privately to their companion during the meeting.

Can employers use the “special circumstances” defence to a failure to consult about collective redundancies?

This is a difficult and fact-sensitive area, so you should always seek advice on your specific situation.

Section 188(7) of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA) provides a defence to a failure to collectively consult where there are “special circumstances which render it not reasonably practicable” for the employer to comply with most of its requirements. Importantly, the main exception is that the defence does not apply to an employer failing to allow employee representatives access to the affected employees and appropriate accommodation and facilities to perform their role during whatever process does take place, such as providing them with any necessary technology to take part in an online consultation process and a way to have some kind of meetings with their constituents. 

There is no definition of “special circumstances”, but an impending insolvency situation on its own is not sufficient. The case law also indicates that it is difficult to rely on this defence to justify a complete failure to consult except in the most extreme circumstances. If a business has cash to keep it going and is making redundancies to remain profitable (or to make a smaller loss), it will be practicable to consult, even though it may be costly – consultation is regarded as a “cost of business”. The existence of the furlough scheme, coupled with other support for business will make it difficult to rely on the special circumstances defence to justify no or short collective consultation. It is therefore important that if employers decide to make collective redundancies, or changes to terms by way of a “fire and rehire” process, they should comply with the collective consultation requirements under TULRCA as best they reasonably practicably can.

The defence may work best if there is a procedural failing, so long as the employer takes what steps it reasonably can. The measures an employer took in the particular circumstances it was facing may also reduce the size of the penalty award for failing to consult, even if it is found to have breached the consultation requirements. The starting point is 90 days’ uncapped pay, with the employer required to show why that amount should be reduced – so taking all practicable steps is very important in reducing what might otherwise be a large penalty.

Immigration issues

What immigration issues should we take into account when considering furlough and redundancies?

When you are considering redundancies (or changes such as lay-offs or salary reductions), you should assess whether this has any effect on the immigration status of any of the employees affected. Any of them who holds a Tier 2 or 5 visa will have reporting requirements that are likely to be triggered, which may then have knock-on implications for whether they can keep their visa or not. Lewis Silkin’s dedicated immigration team can assist you in navigating this part of the process.

Related Item(s): Employment, Redundancy & Restructuring, Redundancy & restructuring, Covid 19 – Coronavirus, Employment

Author(s)/Speaker(s): Colin Leckey, David Hopper,