On 10 May 2022, Charles, Prince of Wales, delivered a speech addressing Parliament, on behalf of the Queen of England Elizabeth II. The purpose of the speech was to give an overview of new laws to be introduced in the coming Parliamentary session. The bills will determine the focus of members of Parliament for the next 12 months. A total of 38 bills were announced and were grouped under the following four categories:
- Growing the economy to address the cost of living
- Making the streets safer
- Funding the National Health Service (NHS) to clear the COVID-19 backlogs
- Providing the leadership needed in challenging times
The announcements relating to several of the bills will prompt discussions amongst U.K. payroll professionals. Read on to find out more.
Harbours (Seafarers’ Remuneration) Bill
This bill gives power to statutory harbour authorities to demand a surcharge or refuse access to U.K. ports when ferry companies pay workers less than the equivalent of the U.K. national minimum wage (NMW).
Earlier this year, P&O Ferries made the news when they terminated nearly 800 workers in one day without notice. These former staff members were then replaced with cheaper agency workers. This bill will make it harder for other ferry companies to act in a similar way by exploiting gaps in legislation.
The majority of those who were fired by P&O Ferries accepted “redundancy” terms and some agreed to be rehired on less favourable terms. Soon after, the U.K. government introduced a new statutory code of practice on “fire and rehire tactics.” The code includes guidance on necessary consultation processes between employers and workers and prohibits employers from terminating employees just to rehire them on less favourable terms.
Shortly after the Harbours (Seafarers Renumeration) Bill was announced, the government sought feedback on what the scope of the new law should be and on the compliance processes and powers of enforcement that should be introduced. The government response will be published soon.
The U.K. takes the enforcement of minimum wage very seriously, and the government previously announced plans to set the national living wage (NLW) at two-thirds of median earnings by 2024, and to reduce the age NLW becomes applicable to 21 years of age. In April 2022, the NLW saw a rise of 6.6% and now sits at £9.50 an hour, and the minimum wage for younger workers was also increased. The Low Pay Commission is an independent body that researches the impact of NLW and NMW on the population and makes recommendations to the government about the rates each year. According to its current consultation, the projected NLW rate for April 2023 is £10.32, and for April 2024 is £10.95.
Data Reform Bill
Payroll professionals are responsible for handling large amounts of personal data and must always remain compliant with data protection laws.
Following the U.K.’s exit from the European Union (EU), the U.K. wants to revisit its laws surrounding data protection. The Data Reform Bill intends to create a data rights regime that leads to a pro-growth and trusted data protection framework, while reducing burdens on businesses and boosting the economy. A more flexible approach will be taken to create a culture of data protection and a focus on outcomes, which will allow public bodies to share more data to improve their services. The Department for Digital, Culture, Media, and Sport predicts these reforms will create more than £1 billion in business savings over the next decade.
The bill also intends to modernise the Information Commissioner’s Office (ICO), making it more accountable to Parliament and the public and increasing its powers to take stronger action against organisations who breach data rules. The ICO upholds information rights in the public interest, promoting data privacy and openness by public bodies.
What Didn’t We Hear About?
Some announcements expected in the Queen’s speech were notably absent. Particularly, the absence of the anticipated Employment Bill, which is of interest to payroll professionals and was initially announced in 2019. This bill would have included the introduction of the following:
- Carer’s leave
- Ensuring that tips for workers go to them in full
- Default flexible working
- The introduction of a new single enforcement body to regulate rights for workers
This body will unify the three enforcement bodies: Gangmasters and Labour Abuse Authority, the Employment Agency Standards Inspectorate, and Her Majesty’s Revenue and Custom’s National Minimum Wage Enforcement.
Other Relevant Bills
Other relevant bills that were not mentioned during the speech include the following:
- Economic Crime and Corporate Transparency Bill—This bill intends to combat crimes such as money laundering, fraud, and illicit financial transactions. The aim is to protect national security, disarm criminals, and support enterprise by enabling legitimate businesses to thrive. Companies House will be given more powers for investigation and enforcement, and better data sharing will make the detection and prevention of economic crime easier.
- Electronic Trade Documents Bill—This bill will make electronic trade documents equal to paper documents for legal purposes, enabling businesses to move from paper-based to digital-based international transactions. This will lower business administration costs, raise security, and benefit the environment.
- Product Security and Telecommunications Infrastructure Bill—The purpose of this bill is to increase security against cyber attacks and improve digital connectivity between individuals and businesses, subsequently growing the economy.
- Financial Services and Markets Bill—This bill aims to maintain and enhance the U.K.’s financial services and establish a new approach to financial services regulation following the U.K.’s exit from the EU. It will encourage investments, business, and the use of innovative technologies to support confidence in financial services. New protections will provide additional support for those who use financial services or who are victims of scams.
During the outbreak of COVID-19, unanticipated circumstances meant the government’s focus was shifted to temporary measures to help manage everybody’s needs. The Queen’s speech has highlighted that, and as we transition back to normality, we can expect more transformation in legal guidelines and significant long-term changes. Payroll professionals must remain agile and continue to adapt to unexpected changes. Legislative knowledge and the ability to ensure compliance are components that make payroll professionals exceptionally valuable to their organisations.