ACAS early conciliation period to be extended from one month to six weeks (1 December 2020)
The Employment Tribunals (Constitution and Rules of Procedure) (Early Conciliation: Exemptions and Rules of Procedure) (Amendment) Regulations 2020 come into force on 1 December 2020 and extend the early conciliation period for ACAS to try and help the potential claimant and employer reach a settlement in advance of a possible employment tribunal claim from one month to six weeks. The option for ACAS to extend the conciliation period by up to 14 days is also removed.
The Regulations also amend the rules on early conciliation to allow ACAS and employment tribunals more freedom in dealing with errors on forms. The changes allow:
- ACAS to contact the potential claimant to correct errors or obtain any missing information in the early conciliation notification form at any time during the early conciliation period; and,
- Employment tribunals more discretion over handling errors on claim forms such as an incorrect early conciliation certificate reference number (which a claimant must provide before a claim can proceed to an employment tribunal.
Freedom of movement for EU nationals in the UK comes to an end on 1 January 2021
The Immigration and Social Security Co-ordination (EU Withdrawal) Act 2020 ends free movement for European Economic Area (EEA) and Swiss citizens and their family members in the UK. This means that from the end of the Brexit transition period (which ends on 31 December 2020) they will be subject to immigration controls. Under long-standing existing arrangements, Irish citizens can continue to enter, live, and work in the UK without permission.
New system of immigration post-Brexit comes into force on 1 January 2021
The Statement of Changes in Immigration Rules, issued by the Home Office, confirms details of the new points-based system of immigration for foreign nationals who wish to live and work in the UK from 1 January 2021.
The different routes of entry include; the Skilled Worker route (replacing the tier two (general) worker routs; the Highly Skilled Worker route, the Global Talent, Start-Up and Innovator route, the Intra-company transfer route, the tier five (temporary worker) route, and a range of other specialist worker routes.
The new rules are being introduced in phases with the changes taking effect between 1 December 2020 and 1 January 2021.
We strongly recommend that employers review their policies and procedures and update them in accordance with the new immigration provisions. Additionally, employers may wish to extend their planning time for employees moving to the UK as the immigration process is likely to take longer.
IR35 extended to the private sector
The implementation of IR35 was postponed due to the COVID-19 pandemic and will now come into effect on 6 April 2021.
The new rules shift who is responsible for determining the status of a contractor for tax purposes and who is liable for deducting tax and national insurance.
To qualify as a small company, and therefore be exempt from these changes, the Company must meet two of the following three qualifying conditions:
- Turnover £10.2m or less;
- £5.1m or less on its balance sheet; or
- 50 employees or less
Please note, that we expect this exemption to change over time, as the government extends the provision of IR35.
We strongly recommend that employers review the working arrangements with any contractors to ensure they comply with the provisions of IR35 if applicable.
From 6 April 2021 HMRC will be given the power to recover tax from parties other than the employer in off-payroll working arrangements
The Income Tax (Pay As You Earn) (Amendment No. 3) Regulations 2020 provide that where an employer has not deducted income tax under PAYE arrangements, and there is no realistic prospect of recovering tax from the employer within a reasonable time frame, HMRC can recover the tax owed from other parties within the labour supply chain, primarily the agency with which the client contracts or the client for whom the work has been undertaken.
We strongly recommend that employers review their processes for tax deductions to ensure that tax is deducted correctly.
For further information, advice, or support in changing contracts of employment, please contact us at firstname.lastname@example.org.