Employment Updates For The Hotels, Hospitality & Leisure Sector (August 2024).
In each edition of Check-In we explore the latest developments in Employment law and their importance to the Hotel, Hospitality & Leisure sector. In this edition, we will look at some updates from the UK, including the:
- Implementation of the Employment (Allocation of Tips) Act 2023, including the publication of the new statutory Code of Practice.
- Proposed reforms to TUPE Regulations and abolition of the European Works Councils framework.
- Migration Advisory Committee’s recommended retention of the Graduate visa route.
- TUC draft AI Bill and what this means for employers.
- New statutory flexible working regime and its practical application.
- Confirmed changes to annual leave and holiday pay for irregular hours and part-year workers.
Employment (Allocation of Tips) Act 2023
The Government has announced that the Employment (Allocation of Tips) Act 2023 will now take effect on 1st October 2024, instead of 1st July 2024.
Under this Act, employers must pass tips to workers. Businesses that frequently receive tips must have a tipping policy, and workers can request their tipping record to support claims in the Employment Tribunal if they believe they are not receiving their due tips.
Employers must also adhere to a new statutory Code of Practice for distributing tips.
Proposed Reforms to TUPE Regulations and Abolition of European Works Councils Framework
The UK Government has launched a consultation paper titled “Consultation: Smarter Regulation – Employment Law Reform,” focusing on proposed changes to the Transfer of Undertakings (Protection of Employment) Regulations 2006 (“TUPE”) and the abolition of the legal framework for European Works Councils (“EWCs”). This initiative follows the “Smarter Regulation to Grow the Economy” policy paper from May 2023, which aims to streamline regulations and reduce business bureaucracy post-Brexit.
Proposed Changes to TUPE
Exclusion of Limb (b) Workers
The Government proposes to amend the definition of “employee” under TUPE to exclude “limb (b) workers”, following the uncertainty created by the Employment Tribunal’s decision in Dewhurst v Revisecatch Ltd [2018] (in which it was held that “limb b” workers were covered by TUPE.
Splitting Employees’ Contracts Between Multiple Employers
The Government also seeks to amend TUPE to prevent the splitting of an employee’s contract between multiple employers following a business transfer. This follows the 2018 European Court of Justice ruling in ISS Facility Services v Govaerts, which allowed for such splits. The proposed amendment would ensure that an employment contract transfers to a single employer, with transferee employers required to agree on who is responsible for each employee’s contract.
Abolition of European Works Councils Framework
The Government proposes to repeal the remaining legal framework for EWCs, which are used for informing and consulting employees about transnational issues. The rights of UK employees to request the formation of new EWCs have already been revoked, following Brexit, but existing EWCs continue to operate and are required to be maintained under the current law. The Government believes existing structures like trade unions can adequately represent employees, making EWCs redundant. This change aims to reduce the operational costs for the small number of businesses that maintain both UK works councils and EU EWCs.
Consultation Process
The consultation seeks input on these proposals and their potential impact, particularly on employees with protected characteristics who are more likely to be affected by service provision changes. The consultation closes on 11 July 2024.
Retention of Graduate visa route – Recommendation by the Migration Advisory Committee (“MAC”)
The Graduate visa route allows students from UK universities to remain in the UK for up to two years after graduation. The MAC has recently reviewed whether the Graduate visa route requires any amendments. The review took place in light of the Government’s objective to reduce net migration and updated Immigration Rules which have increased restrictions on international students who seek to bring dependants with them to the UK.
The MAC published their findings on 16 May 2024 and found that:
- the restrictions already placed on the dependants of students will naturally result in a reduction in the number of graduate visas issued;
- the number of individuals, as a result of Immigration Rules increasing the minimum required salaries to be sponsored as a Skilled Worker, will also significantly decrease over the years to come; and
- while there were “concerns over the use of recruitment agents by universities in certain markets in providing misleading information to prospective international students”, no evidence of widespread abuse was found.
For further information, please contact:
Alison Dixon, Partner, Bird & Bird
alison.dixon@twobirds.com
