The government yesterday published its response to the Retained EU Law Reform Consultation on working time, holiday pay and TUPE obligations (Consultation). The Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023 (EU Reform Amendment Regulations) have also been laid before parliament and the new provisions are due to come into force on 1 January 2024. 

The Consultation

The government recognised that recent Judgments such as Harpur Trust and 2019 CJEU Federación de Servicios de Comisiones Obreras (CCOO) v Deutsche Bank SAE could supersede existing domestic legislation and potentially increase the administrative burden on employers.  It also recognised that the issue of holiday pay and holiday accrual more generally was ripe for reform and required simplification.  (I suspect many employers and employment lawyers would consider the government somewhat late to the party on this particular front. Nonetheless, beggars can’t be choosers, and a belated attempt to address what has increasingly become a bureaucratic headache is better than nothing at all!).

The Consultation launched on 12 May 2023, therefore, sought stakeholders’ views on matters such as: the calculation and accrual of holiday for part-year and irregular hours workers; the introduction of a 52 week holiday entitlement reference period for part-year workers; the TUPE consultation obligations for small businesses where there are no existing employee representatives; the possible creation of a single statutory leave entitlement of 5.6 weeks; and the record keeping requirements under the Working Time Regulations.  

The consultation closed on 7 July 2023. 

In its response (which can be found here), the government confirmed that: 

• the current requirement, under Working Time Regulation 1998, for working time records to be “adequate” are sufficient and, contrary to the suggestion in CSOO, employers need not  record each worker’s daily working hours provided they can demonstrate compliance without doing so;

• it would introduce rolled up holiday pay at the rate of 12.07% of hours worked as an option for irregular and part-year workers, to be paid at a rate of 12.07% of hours worked in a pay period;

• it would codify and crystallise in statutory form case law provisions relating to the carry over of statutory annual leave in the case of sickness absence and family-related leave.   

• it would allow small business with fewer than 50 employees and businesses of any size undertaking a transfer involving fewer than 10 employees to consult with their employees directly if there are no existing employee representatives. 

• it would not be introducing a mandatory 52 week holiday reference period for part-year workers; and

• it would not be creating a single statutory leave entitlement of 5.6 weeks. 

The provisions being taken forward can now be found in the EU Reform Amendments Regulations.

Full details of the amendments together with their effect on, and implications for, employers, will follow in due course. 

For help and assistance with holiday entitlement, pay and TUPE transfers in the meantime, please contact Prettys' Employment Team via enquiry@prettys.co.uk or call 01473 232121.