The Covid pandemic posed many challenges in 2021, not least on the people front. Workers’ personal circumstances, in terms of health, caring responsibilities and home set-up became more relevant to their work – and their employers – than ever before, and businesses faced difficult decisions about how to resource their businesses properly in times of uncertain demand while keeping their staff – and customers – safe.
A new year brings the opportunity to reassess priorities and plan for the year ahead. With that in mind, here is our pick of the top 5 employment law issues for fashion brands, retailers, and hospitality and leisure businesses to look out for in 2022:
Covid measures (still)
With another variant of the virus starting to dominate, and the shortage of tests and staff, the constantly evolving Covid rules remain something businesses need to keep on top of this year. This is particularly important for those who rely on in-person experiences whose staff cannot comply with ‘work from home if possible’ directions, as well as those impacted by foreign travel. The rules around Covid passes, too, could materially affect retail, hospitality and leisure businesses. Currently in England Covid passes are required only for attendance at large venues (including nightclubs) but in some devolved areas they apply to cinemas, theatres and even pubs and restaurants. And although a requirement for Covid passes is currently limited to customers in the UK, elsewhere in Europe we have seen a Covid pass equivalent become mandatory for staff. So, there are (still) a lot of possible variations for businesses to grapple with as we progress through 2022.
Regulation of tips
The Government is planning to overhaul tipping practices as part of the long-awaited Employment Bill which may finally be published in the coming year. The new legislation will include a requirement for employers to pass on 100% of tips to staff with no deductions, other than those required by tax law, and a new statutory Code of Practice on Tipping. An important issue is whether the legislation will allow employers to deduct charges applied directly by banks on tips paid by credit card. The proposals state that employers will not be able to deduct administrative charges. However, the reference to administrative charges in the 2016 consultation was primarily focused on the sometimes vaguely quantified cost to the employer of ‘handling’ or processing the service charges. It seems reasonable to prohibit employers from charging their own handling fee, but it could cause issues if they have to cover bank charges and may mean some businesses consider alternative solutions such as not allowing tips by card.
Redundancy proposals (e.g. extension of protection to pregnant employees)
Currently those who are made redundant while on maternity, adoption and parental leave are entitled to be offered suitable alternative employment with the employer or a group company, if such a role exists. The Government has been promising since 2019 to extend this right to be offered suitable alternative employment (in priority to others) to employees who are made redundant while pregnant or within 6 months of return from maternity and adoption leave.
This is another area without a definite implementation date, as new rules have not yet been made. Change along these lines is still expected, however, and could potentially greatly expand the number of staff benefiting from this right.
In larger organisations and particularly ones with group companies, there will need to be good (and possibly updated) processes for identifying suitable alternative roles, as well as affected employees. Practical guidance and training on the impact of the new rules will also be key, both for HR and for relevant managers, who are often tasked with implementing redundancy processes at a local level (for example in each store). Definitely one to keep an eye on if redundancy or restructuring proposals are in the pipeline this year.
Flexible and hybrid working
We’re now in another period of ‘work from home if you can’ due to Covid. While this guidance more naturally applies to office based roles than the majority of customer-facing roles in the retail, hospitality and leisure industries, the pandemic has nevertheless accelerated and increased the demand for – and use of – all sorts of flexible working in all industries. Where this has worked well, it may be hard to simply switch back to pre-pandemic ways of working. And many businesses will not wish to. Against this backdrop, the Government has also proposed a new right to request flexible working from day one of employment.
New generations of workers are also expecting a greater degree of flexibility, even in roles where there has not traditionally been much of this, and businesses who are willing to be innovative may be rewarded by having the best pick of talent. Finding the resources to carefully consider flexible working requests will be tricky. Making decisions that balance the needs of the business against those of various employees and justifying any refusals of flexible working requests (with evidence) will become a more important issue.
As many businesses move towards (or even embrace!) hybrid working, the issue of fairness of work rotas and team cohesion will be key, affecting not just those businesses applying those ways of working, but also the businesses they work with as contractors and suppliers. Finding the right hybrid working balance in 2022 will be both a challenge and an opportunity.
Worker status
The wrangles in recent years over worker status (whether someone is an employee, worker or self-employed) has played out mostly in the ‘gig economy’ but some of those decisions are very relevant to any business making use of casual workers to adapt to fluctuating demand, such as hotels, bars and seasonal workers in retail. A recent case (involving a football referee) showed that even where the business is not required to offer any work and the individual is not required to accept any work offered (and so there is no overarching or long-term employment relationship), a particular assignment (here, a football match) can still be ‘employment’ for the duration of the assignment. Businesses should be aware that this may mean that casual arrangements are more easily fitted into the ‘employment’ box in the future, whereas they may previously have been treated as something different. In future, it may only be possible to conclude confidently that an individual engaged on a ‘casual’ basis is not an employee if they have an unfettered right of substitution/delegation.
On a related note, there is a proposed new right for workers who work variable hours to request a more predictable and stable contract after 26 weeks, which may present some challenges for businesses making use of such labour and their overall resourcing strategy.
We would encourage businesses considering their resourcing options in 2022 and beyond to make use of Lewis Silkin’s Resourcing Hub, which has further information.
By Anna Sella, Employment – Lewis Silkin
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