Protect business interests Archives

Employment Rights Bill 2024: Worker protections and productivity

Posted on 10 October 202421 March 2025 by Sarah O'Sullivan

Understanding the Employments Rights Bill 2024

The Employment Rights Bill 2024 (the Bill), unveiled on 10 October, introduces significant changes to the UK’s employment laws, marking the largest overhaul in decades. With 28 reforms, the Government has presented the Bill as aiming to enhance worker protections and boost productivity across the economy.

One of the standout changes is enhanced “day one” rights, including the right not to be unfairly dismissed (see also below). With this, there is a proposed introduction of a statutory probation period for new hires. This may allow employers more time to assess employee suitability notwithstanding the new day one rights being introduced.

Key Reforms: Day-one rights and probation periods

One of the most significant reforms is the removal of the existing two-year qualifying period for protection against unfair dismissal. This change ensures that an estimated nine million workers will benefit from protection from unfair dismissal as soon as they start a new role.

Additionally, the bill includes day-one rights for paternity leave, unpaid parental leave, and bereavement leave, building on the existing day-one right to maternity leave. This is a major change.

The Government will consult on a statutory probation period, with the current proposal favouring a nine-month limit. This extension, which has drawn mixed reactions from businesses and unions, is intended to provide flexibility for employers, while maintaining worker protections throughout the probation period. Full implementation of this probation reform is expected by autumn 2026, following further consultations.

End of exploitative practices and strengthened sick pay

The bill also takes aim at so called exploitative zero-hours contracts and controversial fire-and-rehire practices. These reforms are intended to provide more job security and protections, especially for workers on flexible or irregular contracts. For those on zero-hours contracts, the bill introduces the right to guaranteed working hours after a set period, ensuring greater financial stability for over a million workers.

Another key reform is the overhaul of statutory sick pay. Under the new provisions, workers will be entitled to sick pay from day one of illness, removing the previous three-day waiting period and the lower earnings limit. This change aims to provide immediate financial support for those who fall ill, especially lower-paid workers who previously did not qualify for statutory sick pay.

Flexible working and gender pay gap action plans

Recognising the changing dynamics of the modern workplace, the bill makes flexible working the default, unless employers can demonstrate that it is impractical. This reform is designed to support workers with caregiving responsibilities and improve work-life balance across various sectors.

Large employers will also be required to implement action plans to address gender pay gaps and support female employees, particularly through menopause. This measure is part of a broader push to promote inclusivity and diversity within the workforce.

Fair work agency and long-term reforms

The bill establishes a new “Fair Work Agency”, tasked with enforcing key rights such as holiday pay and sick pay. This agency will consolidate existing enforcement bodies, providing better guidance for employers while ensuring compliance with the new laws. The government has also outlined future reforms in its “Next Steps” document, including plans for a right to disconnect, mandatory reporting on ethnicity and disability pay gaps, and a move towards a simpler, two-tier worker status framework.

While the Employment Rights Bill boasts a sweeping set of reforms, many of the provisions will take time to implement, with some requiring further consultations before being fully enacted. Nevertheless, the bill represents a bold step towards improving worker protections and enhancing productivity in the UK economy.

For more insights into how these changes may affect your business or employment, contact our Tees Law team. We’re here to provide legal guidance on navigating this new landscape and ensuring compliance with evolving employment laws. We’ll be running webinars and workshops on the new rules and how businesses can navigate these new waters over the coming weeks and months. Please get in touch with us if you are interested in these.

On Wednesday 6 November we are running a specific webinar around Employment Law changes that the Labour government has proposed. You can register your interest here: https://communications.teeslaw.com/27/178/landing-pages/rsvp-blank.asp.

For any questions, please contact us at employmentteam@teeslaw.com.

Navigating AI regulation in the UK: Essential insights for employers

Posted on 10 October 202421 March 2025 by Sarah O'Sullivan

This year, the European Parliament formally adopted the Artificial Intelligence Act (“AI Act”), the first comprehensive law designed to regulate AI on a broad scale across the European Union.

This landmark piece of legislation which was introduced on 13 March 2024 laid the foundation for AI governance within the EU but has left some UK employers wondering how these developments will influence the regulatory landscape, particularly as we observe the new long-term objectives for AI that have been proposed by our Labour Government.

The Current UK regulatory landscape

Last year on 3 August 2023, the Government released their AI Regulation White Paper which indicated that the UK had no plans to introduce a horizontal AI regulatory framework like the EU. Instead, the feedback received as part of the Government’s consultation on the policy suggested that the UK would lean more towards adopting a principles-based model that would allow existing sector-specific regulators to tailor AI regulations according to their respective industries. At present, this position remains unchanged, and it is likely that we will see AI-specific laws and regulations introduced in the UK in the not-so-distant future.

As the UK Government enacts its AI agenda, employers will have to navigate several considerations for effective AI regulation and compliance. Below, we have explored some of the essential areas that employers should focus on as they look to integrate AI systems into their businesses.

Sector-specific regulation

Employers should familiarise themselves with how AI regulations may differ across various industries. Each sector may be guided by unique regulatory bodies that impose different requirements for AI use, and which would necessitate a more proactive approach to compliance. In addition to this, businesses should conduct their own assessment of AI technology to ensure that it adheres to existing regulations and anticipate any future legislative changes.

AI development

The Government has emphasised the importance of responsible and ethical AI use. Employers will need to ensure they engage in best practices around transparency, accountability and inclusivity where AI is deployed, to mitigate potential risks (where possible) and maintain public trust. This may involve implementing new policies and guidelines for the ethical deployment of AI technologies.

Impacts on employees

As AI systems evolve, so do their effects on the workforce. Employers should understand the implications of AI on jobs and employment dynamics. Preparing the workforce for reskilling and deploying AI in underserved areas of business will be crucial for maintaining a productive and efficient working environment. Earlier this year, The Institute for Public Policy Research estimated that roughly 11% of workplace tasks are exposed to automation through existing generative AI, and that this could rise to 59% of tasks in the second wave of AI adoption as technologies develop to handle increasingly more complex processes.

Data privacy and security

With AI’s reliance on handling vast amounts of data, compliance with existing data protection regulations (such as the General Data Protection Regulations) is highly important. Employers must ensure their AI systems are secure and responsible in their data usage and align with the latest best practices.

Monitoring regulatory changes

The AI regulatory landscape is continuously evolving. Employers should establish mechanisms to stay informed about upcoming regulations, guidelines, and industry standards that could impact their practices. This could involve, among other things, engaging with industry associations, regulatory bodies, and participating in relevant forums.

As employers look to navigate the evolving AI landscape, it is crucial that they adapt and remain compliant with the latest legal requirements. Company policies, hiring practices, and data privacy protocols should be reviewed periodically to reflect the changes to AI tools and technologies. Encouraging a culture of continuous learning by helping employees upskill and adapt to these changes can be an advantageous strategy and help equip staff with the knowledge to use AI responsibly and effectively.

Balancing innovation with regulation always requires a strategic approach. Businesses should consider using AI effectively whilst adhering to new legal and ethical standards to stay compliant and support a responsible and sustainable AI-driven future.

At Tees, we have specialist Employment Law experts with many years of experience who can help businesses navigate the complex and evolving AI landscape confidently and clearly.

Divorce and your business: Steps to protect your assets

Posted on 12 August 202422 March 2025 by Sarah O'Sullivan

Getting divorced is almost always a stressful experience. – Relationships end, arguments ensue, assets get divided up, and there can be the welfare of children to think about. Now add to that the thought that your livelihood is threatened too. This is the situation business owners can face when they consider divorce.

Will their ex-partner get half the business? Will the business have to be sold? What if you both work in the business? Will we all lose our livelihoods? What will be left as an inheritance for my children?

These are the kind of stressful questions we are here to answer – and help resolve for you.

Caroline Andrews, Senior Associate in the Tees Family law team, considers the challenges and sets out what can be done. As a business owner planning to divorce, you have options. It’s vital that you get specialist legal advice to make sure you choose the right route to go down.

How are assets divided in divorce?

In a divorce, the first challenge is establishing each party’s needs and how they can be met. Consideration is also given to the principle of sharing and dividing assets in an objectively fair way—but that does not necessarily mean equal.

The courts have a very wide discretion to reallocate assets within a marriage. If one of you owns a business, that business’s assets (or liabilities) will be considered when assessing the ‘pot’ that will be distributed between you.

The Impact of Divorce on Different Business Structures

The impact of divorce on a business can vary depending on its structure.

Limited companies vs. sole traders: If you are a sole trader, your business assets and liabilities are considered personal assets and may be subject to division during a divorce. This means that your spouse could potentially claim a share of your business. On the other hand, limited companies are separate legal entities, and your spouse is less likely to have a claim on the business itself. However, they may still be entitled to a share of any dividends or salary you receive from the company. So, is a limited company protected from divorce? The answer can be complex and depends on various factors. Tees specialist solicitors understand the complexities of business structures and can help protect your interests during a divorce.

Partnerships and family-owned businesses: Divorce can have significant implications for partnerships and family-owned businesses. In a partnership, your spouse may become entitled to a share of the business unless a prenuptial or postnuptial agreement specifically addresses the business. Family-owned businesses can also face challenges, as the division of assets may require valuing the business and negotiating how to divide its value.

In general, the court will try not to order the sale of a business if one of the parties is against this. Instead, the outcome is more likely to be that the business is retained by offsetting against other resources or there is a series of ongoing payments funded by the business profits. This arrangement tends to work well when one person is only interested in the business for the money it generates, not for the business itself. This has the benefit of keeping the business going for the future.

Call our specialist solicitors on 0808 231 1320

Divorce and business valuation

Valuing the business is often the first step which gives vital clarity. A valuation can also report on business debts and liabilities, as well as cash flow and liquidity. Take care to consult a legal team that has access to business legal expertise, as well as family law expertise.

It will of course help if you have kept accurate financial records and have avoided mixing business and family funds together, to understand the valuation of the business and how it operates. There are occasions of course where business and family funds are mixed – which potentially makes the task harder, but not impossible.

It’s important you don’t attempt to move money out of the business if you think you might be headed for divorce. The courts require full financial disclosure as they strive towards a fair resolution and if you’re caught having done this, it will not do you any good in the eyes of the court.

The valuation process should identify:

the business structure – a partnership, limited liability partnership or company, or are you a sole trader?
whether it’s possible to take funds out of the business without damaging its future prospects
information about the shareholdings arrangements: who has shares, to what value and what are the relative percentage shares that people own, and are they family members?
the tax liabilities – both for individuals and the tax that the business itself owes
Is there a parent company, with additional companies with value (or debts and liabilities) to consider?

The history of the business

It’s important to gather evidence to establish how and when the business began and who has contributed what to its development. This is because the respective roles of both parties in the development of the business over time will impact the negotiations when it comes to deciding who gets what.

When did it start trading? Has it been in the wider family for many years? Or was it built up by one or both of you during the marriage, or started by one of you before you married?

The people running the business

You need to establish the facts around the running of the business. This is also important if you don’t plan to sell the business, but it will provide income going forwards to the person who doesn’t keep the business. You need to clarify:

who is pivotal to the running of the business? Who are the other key players?
are any of them family members?
does the business employ your partner? This can be tempting for tax reasons, but it could allow them to claim a bigger share, claiming they have contributed more than they may have actually done
are there adult children involved in the business?
does anyone in the family live on the business premises?
is the business run from the family home?

The vision for the business

If the business has significant value and the plan is not to sell it, the two parties to the divorce may need to discuss whether there are sufficient other assets in the marriage (such as property or investments) to ‘offset’ the value of the business by giving one party more non-business assets to allow the other party to continue the business.

It might be intended that the business is sold at some point in the future, for example at the point of retirement, in which case a balance in a settlement could be finalised at a future date.

Succession planning

If you put in place clear plans for your children to inherit the business and be involved in its running, this can help sway the court that selling it to release funds, is not in the adult children’s interests.

Farming businesses

When the business is a farming business, things can be even more intertwined because the family home is often standing on the land and farming is an all-encompassing way of life. At Tees, our heritage and culture has been rooted in the local farming community in the East of England for well over one hundred years. Find out how we can help you protect your farming business from divorce.

Is going to court inevitable?

No. Going to court is the last resort and should be avoided where possible by engaging in non-court dispute resolution wherever possible. The courts are placing more and more emphasis on non-court dispute resolution as a means of solving disputes because of the significant delays and expense that come with court proceedings.

You should therefore first consider mediation, collaboration and arbitration as alternatives to court proceedings, to try and get matters resolved as efficiently, cost-effectively and amicably as possible.

Protect your business in advance

By taking professional advice and taking time to plan, you can put in place measures to create a structured settlement to protect the business. If you are thinking ahead you should consider a prenuptial agreement (or post-nuptial agreement if already married) as this is another effective legal device for protecting assets, such as businesses, for the long-term

Wealthier post-divorce? Protect your assets

Posted on 12 July 202422 March 2025 by Sarah O'Sullivan

Why you need a financial consent order after divorce

Did you know your ex-partner could still claim money from you even after your divorce is finalised? It may seem unfair, but a financial consent order can protect your assets and prevent future claims.

When your divorce or civil partnership dissolution is finalised with a decree absolute, your legal ties are severed, but without a financial consent order, your ex-partner could still make claims against your assets. These claims could arise from any significant change in circumstances, such as:

One partner developing a successful business
Inheriting money or assets
Building pension benefits
Winning the lottery

Without a financial consent order, these claims can be made at any time, leaving you vulnerable. Protect yourself now by securing a financial consent order.

What is a financial consent order?

A financial consent order is a legally binding document that formalises the financial agreement between divorcing couples or those dissolving a civil partnership. It outlines how financial assets, such as property, savings, and pensions, will be divided.

A financial consent order can also prevent future claims from your ex-partner and sever all financial ties (known as a clean break order). The terms of the order will depend on your financial situation and what both parties agree to.

How to obtain a financial consent order

Couples can reach an agreement through direct negotiations, mediation, or solicitor-led discussions. Once an agreement is reached, a solicitor can help draft the consent order and submit it to court for approval.

The court’s role is minimal – it will simply review the financial consent order to ensure it is fair to both parties. Once the judge approves it, the order becomes legally binding after your divorce or civil partnership dissolution is finalised.

Avoid the courtroom

There is no need to attend a court hearing. The court will only review the consent order to ensure fairness. If the judge is satisfied, the order will be approved, providing peace of mind and protecting you from future financial claims.

For more information or a no-obligation consultation, contact Lisa Honey at Tees Solicitors.

Case study: Vince v Wyatt (2015)

The case of Vince v Wyatt highlights the importance of securing a financial consent order, even if you think it’s not necessary at the time of your divorce.

In this case, the couple married in 1981, had one child together, and separated in 1984. Their decree absolute was granted in 1992, but they never entered into a financial agreement (consent order). Ms Wyatt did not request financial support from Mr Vince at the time, and she raised the children alone in difficult financial circumstances.

In 1995, Mr Vince founded a green energy business, Ecoticity, which became highly successful, eventually being valued at £57 million. Meanwhile, Ms Wyatt’s financial situation remained modest.

In 2011, 27 years after their separation, Ms Wyatt applied for a lump sum payment, citing financial hardship. Mr Vince sought to have the claim dismissed due to the long delay since their divorce. However, the case went to the Supreme Court, which ruled that her claim could proceed, despite the lengthy delay.

The case ultimately concluded with Ms Wyatt accepting £300,000 as a full and final settlement. While the couple had no assets when they divorced, a financial consent order could have prevented this prolonged legal battle and the associated costs.

Don’t risk it – protect your financial future and avoid costly disputes by securing a financial consent order today.

When should Non-Disclosure Agreements be used?

Posted on 20 April 202422 March 2025 by Sarah O'Sullivan

A Non-Disclosure Agreement (NDA) is a legal contract used to prevent people from discussing confidential information. In employment law they are often parts of a contract, or sometimes a standalone contract between employees and their employer.

Typically NDAs prevent employees and former employees from making information public, they can sometimes be referred to as ‘gagging orders’ or ‘confidentiality agreements’ or may be included within a settlement agreement when leaving employment.

Why use a Non-Disclosure Agreement?

NDAs have a valid use to protect commercially sensitive information such as inventions, ideas or anything that may damage a company’s reputation. They may be signed for instance by parties contemplating the sale and purchase of a business.

The Women and Equalities Select Committee (WESC) has recently published a report addressing the issues and is specifically concerned by the use of gagging clauses to settle discrimination and harassment claims, arguing that it means that these cases are not being properly investigated and that they cause an imbalance of power between employer and employee to the detriment of the employee.

What does a Non-Disclosure Agreement cover?

NDAs cannot stop an employee’s reported alleged illegal acts. If a manager or colleague faced allegations of or fraud, for instance, reporting these to the police would not be prevented.

Allegations of an employer making inappropriate comments, or bullying could be covered. However bullying may be illegal if it relates to certain protected characteristics such as race, religion, age, disability or sexual orientation.

The length of time for which an NDA applies will vary for each agreement.

Call our specialist solicitors on 0808 231 1320

Are Non-Disclosure Agreements legally binding?

The contracts are legally binding so that if you are a victim and you sign one, receiving a financial pay-out, you are prevented from talking to anyone about the allegations.

Can a Non-Disclosure Agreement be broken?

If you breach a valid, legally compliant NDA, then it is classed as breaching a contract, leaving you liable to legal action.

If a company thinks it is likely the NDA is going to be breached, then they can apply for an injunction. If you then breach an injunction, this is a criminal offence, and can lead to a fine or jail for those found guilty.

What if an employer wants to settle a discrimination case?

It is common to settle disputes, including for discrimination by settlement agreements. These can include confidentiality provisions but must not prevent whistleblowing or reports on criminal offences.

Do whistleblowers have legal protection?

NDAs cannot be used to prevent workers from whistleblowing. Any clause aiming to prevent you from making a valid public interest disclosure will be void.

References

These can be included in the settlement agreement and will not be contrary to an NDA or confidentiality terms.

Enforceability

Confidentiality and non-derogatory comments provisions can form valid, important parts of the deal for all parties in a transaction or settlement but must be drafted with care and in measured terms that are legally enforceable and compliant. We can assist you in advising and drafting on these.

At Tees we have a team of employment law specialists who can help you with any of the issues discussed here and provide support whether you choose to sign an NDA or contest it.

Key changes to employment law coming into effect this April 2024

Posted on 25 March 202422 March 2025 by Sarah O'Sullivan

With numerous changes to employment law coming into effect from 6 April 2024, employees and employers should remain current and prepared for the latest legal developments.

Our summary below highlights key changes that will be made to the following:

National minimum wage
Flexible working
Carer’s leave
Paternity leave
Calculating holiday pay for irregular hours and part year workers
Redundancy protection
Changes to tribunal compensation limits and statutory amounts for a weeks’ Pay

National minimum wage and national living wage

From 1 April 2024, the National Living Wage will increase to £11.44 an hour (from £10.42), and this will be adjusted to include those aged 21 and over.

The National Minimum Wage from 1 April will increase to:

£8.60 an hour (from £7.49) for workers aged 18-20;
£6.40 an hour (from £5.28) for workers under the age of 18; and
£6.40 an hour (from £5.28) for apprentices.

Employers should ensure they meet the new rates applicable. Where necessary, employers should increase employee remuneration for the first pay period after 6 April. Failure to meet the requirements may lead to staff raising grievances and/or bringing claims and/or HMRC taking enforcement action. For more complex arrangements, such as where accommodation is provided, we recommend employers take advice to ensure that they are meeting the requirements.

Flexible working

From 6 April, the right to make a flexible working application will become a day-one right for all employees. The Flexible Working (Amendment) Regulations 2023 will remove the current requirement for an employee to be continuously employed for at least 26 weeks to make an application.

Under the new legislation, employees can make two applications per year and will not have to explain the effect this change in work might have on their employer. Employers will have two months (previously three) to consult and respond to the flexible working requests.

Employers should observe the guidance on handling flexible working requests (in conjunction with the new regulations) which has been published by ACAS in their new Code of Practice which can be found at: https://www.acas.org.uk/acas-code-of-practice-on-flexible-working-requests/html

Carer’s leave

The Carer’s Leave Act 2023 will come into force on 6 April. This gives employees the right to take one week of unpaid leave per year to provide or arrange care for a ‘dependant’ who has:

– a physical or mental illness that means they’re expected to need care for more than three months;
– a disability as defined by the Equality Act 2010; or
– requires care because of their old age.

The dependant does not have to be a family member, it can be anyone who relies on the employee for care. This is another day-one right. Employees will be able to take this leave flexibly, but they can only take one week of leave every year.

Employers should ensure that managers and senior leadership understand this new entitlement and communicate the changes to employees. Employers will need to consider how this will affect any contractual and/or carer policies they might have in place, and if necessary, update their policies to cover the new right. We recommend seeking advice as appropriate to ensure that policies and procedures are compliant.

Paternity leave

Changes to The Paternity Leave Amendment Regulations 2024 will come into force on 6 April.

The Regulations (which will apply in cases where the expected week of childbirth falls on or after 6 April), will allow fathers and partners to take their paternity leave in two non-consecutive blocks of one week within the first year after the birth or adoption of their child. This change offers fathers and partners more flexibility to take leave at times which work for their family. Employers should be mindful that this new measure will only require an employee to provide four weeks’ notice prior to each period of leave.

Again, it is important that employers review their policies and processes in line with the new Regulations and update any policies and procedures as appropriate and seek advice as appropriate.

Calculating holiday pay and leave for irregular hours and part year workers

The Employment Rights (Amendment, Revocation and Transitional Provision) Regulation 2023 contains important changes to how holidays should be calculated and paid for ‘irregular-hours’ and ‘part-year’ workers (both of which have been defined in the Regulation).

From 1 April 2024, employers must adopt the accrual system for calculating leave entitlement when dealing with irregular hours or part year workers. This change means that rather than using the leave year system (i.e. 5.6 weeks leave in a given leave year comprised of 4 weeks’ annual leave and 1.6 weeks’ additional leave), they will instead get one-twelfth of their leave in each month (i.e. if a worker works for 5 days week, and is entitled to 28 days annual leave a year, after their third month of working, they would be entitled to 7 days’ leave).

Separately, for leave years starting on or after 1 April 2024, employers will also have the option to pay their irregular hours and part-year workers rolled-up holiday pay. This involves spreading a worker’s holiday pay entitlement over the year by adding an amount on top of their basic pay. Employers should notify their worker’s if they are planning to use rolled-up holiday pay, and introducing this change might involve updating contracts and any policies and procedures.

For employers, practical difficulties can arise when workers who have irregular hours do not receive the correct amount of holiday pay under the rolled-up holiday pay system. Workers may receive too much or too little depending on the number of hours worked, and the risk is that this could potentially result in claims being brought for unlawful deduction of wages. To mitigate this risk, employers need to ensure that payslips make clear what element of a worker’s pay is holiday pay and what is basic pay and ensure that they meet any requirements around clearly setting this out in the worker’s pay information.

Redundancy protection

For employees taking maternity, shared parental or adoption leave, The Protection from Redundancy (Pregnancy and Family Leave) Act 2023 from 6 April will bring into force The Maternity Leave, Adoption Leave and Shared Parental Leave (Amendment) Regulation 2024, which will extend the priority status for these individuals being offered suitable alternative roles by their employer (if available), where they have been selected or put at risk of redundancy. The act most importantly now extends to employees who are pregnant.

The protection will be extended for up to 18 months (after the expected week of childbirth, the child’s date of birth, or adoption), for those who have recently returned to work from maternity, adoption or shared parental leave (after six or more consecutive weeks) and for employees who are pregnant and have notified their employer of their pregnancy.

Employers will need to ensure that managers and senior leadership staff are aware of the changes being made to the priority status for redeployment opportunities in redundancy situations.

Tribunal Compensation Limits and a Week’s Pay

The maximum compensatory award for unfair dismissal will increase from £105,707 to £115,115, or a year’s gross pay, whichever is lower;
The limit on one week’s pay when calculating redundancy pay (and the basic award for unfair dismissal) will be raised from £643 to £700;
The minimum basic award for some forms of unfair dismissal will rise from £7,836 to £8,533; and
The cap on statutory redundancy pay will increase from £19,290 to £21,000.

The Employment Relations (Flexible Working) Act 2023

Posted on 21 August 202322 March 2025 by Sarah O'Sullivan

The Employment Relations (Flexible Working) Act 2023, which received Royal Assent in July 2023, is intended to give workers more flexibility over when and where they work. This legislation is expected to come into force in the summer of 2024, based on the timescale from Royal Assent.

Chartered Institute of Personnel and Development (CIPD) research (Flexible and hybrid working practices in 2023 | CIPD) indicates that 40% of employers have seen an increase in requests for flexible working following the Covid-19 pandemic, and 66% of organisations saying they believe it is important to provide flexible working as an option when advertising jobs.

Employers and employees should therefore be mindful of the looming changes to the process surrounding flexible working requests.

Who can make a flexible working request?

Employees with at least 26 weeks of continuous employment are currently entitled to make flexible working requests to their employer. It should be noted, however, that although this has remained a requirement under the new legislation, it is anticipated that further legislation will eventually be implemented to remove this requirement, making flexible working requests a day one right for employees. Of course, any employee can make a request but employers are not obliged to consider requests unless made by eligible employees.

What are flexible working requests?

Flexible working requests should be made when an employee wishes to make a change to any of the following:

the hours they work
the times when they are required to work
the place they work (i.e. working from home, or another of the employer’s sites).

Some examples of how these changes could be implemented in practice include:

reducing hours to work part-time
changing start/ finish times
compressing hours to work the same number of hours over fewer days
job sharing.

Employees can also request the change be limited to specific days or weeks only (e.g. only during school term time), or for a limited period such as 6 months only.

How an employee can make a flexible working request

To meet the statutory requirements of a formal flexible working request, applications should:

be made in writing
be dated
state that it is an application made under the statutory procedure
specify the change the employee is seeking
specify when they wish the change to take effect
state if and when the employee has previously made an application.

An important change in the new legislation is, previously, there was an additional requirement for the employee to explain the effect that flexible working would have on the employer, and how the employer might deal with such an effect. This requirement has been removed by the new legislation.

How an employer should deal with a flexible working request

Under the new legislation, employers are required to deal with requests within two months of receipt (as opposed to the previous three months), unless both parties agree to extend this period.

Employers must deal with flexible working requests in a reasonable manner, and can only refuse requests for the following reasons (which remain unchanged under the new legislation):

the burden of additional costs
detrimental effect on the ability to meet customer demand
inability to reorganise work among existing staff
inability to recruit additional staff
detrimental impact on quality
detrimental impact on performance
Insufficiency of work during the periods the employee proposes to work
planned structural changes.

The new legislation also requires employers to consult with the employee before refusing a request. The new legislation does not provide guidance around what is required in such a consultation, but the ACAS Code of Practice does contain some guidance around this. The ACAS guide also has content covering dealing with requests in a “reasonable manner”. ACAS is currently in the process of updating this code.

If a flexible working request is accepted, the employer should issue an updated statement of main terms or provide a statement of changes to employment (under section 4 Employment Rights Act 1996).

If the request is denied, the employer must write to the employee stating this, keeping in mind that under the new legislation, the employee must be consulted before a request can be denied. Employers should note that although there is no statutory right to appeal the decision, employees now have the right to make up to two flexible working requests within any twelve month period, so if an employee’s first request is denied, they are entitled to make another one.

Employers need to stay up to date

With CIPD research showing that 49% of employers were previously unaware of the impending changes to flexible working legislation (Flexible and hybrid working practices in 2023 | CIPD), employers should ensure that they are aware of the changes as set out above. They should also consider updating any existing policies and procedures relating to flexible working arrangements to ensure that they are in line with the statutory changes and new time limits.

With the new legislation anticipated to come into force next year, we understand the ACAS Code of Practice on handling requests for flexible working is also to be updated. The purpose of the ACAS code is to “provide employers, employees and representatives with a clear explanation of the law on the statutory right to request flexible working, alongside good practice advice on handling requests in a reasonable manner” (Acas consultation on the draft Code of Practice on handling requests for flexible working | Acas).

Employers should look out for updates in relation to the new ACAS code and ensure that they are now complying with the new statutory requirements ahead of the implementation of the new Act, whilst also keeping in mind the likelihood of flexible working requests becoming a day one right.

What could happen if I unreasonably refuse a flexible working request?

If a tribunal upholds an employee’s complaint concerning the handling of a flexible working request, you may be required to reconsider the employee’s application. Alternatively, or in addition, the employee may be awarded compensation, additionally, issues over flexible working could also lead to other claims (see below).

Sex discrimination claims and flexible working

A mishandled flexible working request might lead to a potential discrimination claim. For example, if your flexible working policy has a greater impact on one sex over another (or on one particular employee because of their sex) you may face claims of indirect sex discrimination.

The ACAS guidance on flexible working, mentioned above, recommends that employers and managers should avoid making assumptions when assessing flexible working requests. All requests should be assessed consistently and with regard to business circumstances.

However, acting consistently does not necessarily mean that you can adopt a blanket flexible working policy – accepting or refusing all requests. If a dispute arises, a tribunal will look at any discrepancies in the acceptances or refusals of flexible working requests.

If your policy is found to be indirectly discriminatory, it might be possible to argue that it was a proportionate means to a legitimate aim – i.e.: that there was a good business, commercial or administrative reason for the difference in treatment.

Consideration of flexible working requests should be based on real operational needs and decisions should be objectively justifiable.

Flexible working and constructive dismissal

In general terms, a constructive dismissal occurs where an employee feels forced to resign because of the actions of their employer.

To be successful in a claim, the employee must show that their employer has committed a fundamental breach of contract that is sufficiently serious to justify the employee’s resignation – and that the resignation was due to that particular breach. The breach could be a one-off event or just one instance in a longer history of events.

Unreasonably refusing an employee’s flexible working request, or even handling a reasonable refusal badly, could constitute one of these events and expose you to a potential constructive dismissal claim.

Advice for employers on home working

Posted on 9 December 202222 March 2025 by Sarah O'Sullivan

The expectation for flexible working is becoming more and more in demand. According to the office for national statistics, more than 8 in 10 workers who had to work from home during the coronavirus pandemic said they planned to do hybrid work.

Government proposals around changing the rules around flexible working requests include reducing the formal content required for a request, day one rights, as opposed to eligibility currently subject to 26 weeks’ service and allowing up to 2 requests a year. The debate continues around finding arrangements that work for employees and employers and with employers often having to approach how they deal with requests and principles of flexible working, carefully, to reduce the risks of claims and attract and retain good calibre candidates to jobs.

In the current economic climate, businesses may be reassessing their requirements with consideration being given to reducing office space and rental costs, which may result in more companies considering a home-based workforce for the long term.

As we continue to debate what the ‘new normal’ looks like, it is evident that this is something of a moving target with expectations, trends and business requirements seemingly changing quickly. Against this background, it is worthwhile considering what the legal implications are for employers on some of the key considerations around home working.

Contracts of employment

Many employees will be working under contracts of employment with no specific provision to work from home, and the place of work will most likely be stipulated as the employer’s premises.

Unless there is a written term in the contract of employment permitting home working, employers would need the agreement of the employee in order to insist on home working. Imposing a unilateral change without the agreement of those affected employees could constitute a breach of the employment contract. What happens in practice, though, may also be relevant, whether that is around the employer and/or an employee wanting to revisit the ‘normal’ place of work and how work is delivered post Covid-19.

It is recommended that employers check the wording of the ‘place of work’ clause in their employment contracts as the wording may include a degree of flexibility in the favour of the employer, which can allow for a change in place of work on a temporary or perhaps even permanent basis.

If the contract contains wording allowing for flexibility and changes then the employer may not be in breach of the terms by enforcing a permanent switch to home working. Employers should note that it is still important for employers to act reasonably when implementing such a clause, otherwise, they risk breaching mutual trust and confidence – This is a term implied by law in all employment contracts and breach of it is commonly used in constructive unfair dismissal claims. It is also worth keeping in mind that terms can become part of the contract by “custom and practice”. If in doubt, employers should seek legal advice on their particular documentation and issues arising.

In any event, employers are well advised to ensure they communicate with staff in advance and where appropriate, consult as well as set aside reasonable time before implementing changes to the place of work to allow employees time to prepare and adjust.

Where consultation is needed on employment contract changes

Where there is no flexibility to the place of work clause the employer will need to adopt a different approach. Employers will need to discuss the possibility of working from home with employees and consult with them in order to get their agreement to home working along with the necessary change to the terms of their contract. Again, communication is key and a lack of communication is often a key part of disputes arising.

Call our specialist solicitors on 0808 231 1320

Dealing with a refusal to agree to contract changes

If however, employees in this situation maintain a refusal and the employer can demonstrate that:

there are good business reasons for switching to a home-working model,
it has undertaken appropriate consultation and
it has followed a fair procedure;

then it may be possible for an employer to dismiss.

In appropriate circumstances, such dismissals can be considered fair with the employer relying on “Some Other Substantial Reason” as the potentially fair reason to dismiss, provided the employer can demonstrate that the dismissal was reasonable in all the circumstances.

This should be a last resort if there is a failure to agree and the alternatives have been considered. Such dismissals are subject to due process and bring with them the risk of, amongst other things, unfair dismissal claims for eligible employees. Employers who approach such matters without due care will be exposed to claims and again, seeking professional advice early is prudent.

Employers who are faced with this scenario and are looking to dismiss should look to offer those refusing employees re-engagement on the new amended terms, including the homeworking provisions. Consideration should also be given to the numbers of employees affected: if this is 20 or more then collective consultation may need to be undertaken with potentially severe penalties if the right steps are not followed.

Duties towards employees when working from home

Where employees are working from home, employers should ensure that they are treated in the same manner as all other employees. Home-based employees are entitled to the same rights and benefits as any employee working at the employer’s premises.

An employer has both statutory and common law duties towards its employees and is responsible for an employee’s health and safety, “so far as is reasonably practicable”. In practice, this means that employers should conduct a suitable risk assessment of all work activities carried out by homeworkers to identify any possible hazards. Employers will then need to consider these obligations to decide what measures need to be put in place.

Confidentiality and data protection issues when working remotely

In addition to the health and safety aspects of home working, employers will need to consider how to safeguard business confidentiality and data protection requirements with increased chances of breaches taking place when outside of the employer’s premises.

Careful consideration is needed given the potential damage and loss that could be caused through unauthorised breaches, including significant fines that can be imposed by the Information Commissioners Office for breaches of data protection legislation – which has been strengthened since 2018.

It is also key for employers to ensure that they have suitable arrangements in place to help maintain contact with other staff, including office-based and home-workers, in order to limit issues that could arise through increased isolation of working remotely.

Where reasonable adjustments may be necessary

Where an employee has a disability, then consideration should be given to whether the provision of some equipment is required in order for the employer to comply with their duties under the Equality Act 2010 to make reasonable adjustments.

Right to requests for flexible working

It is still the case that employers are not required to agree home working requests from staff. There is no right to work from home and instead, presently, employees with 26 week’s service have the right to request flexible working arrangements.

Employment tribunal: A guide for employers

Posted on 28 May 202122 March 2025 by Sarah O'Sullivan

If not managed effectively, workplace conflict can be hugely costly for employers and lead to employment tribunal claims. According to new research from ACAS, nearly 10 million people experienced conflict at work in 2018/19. As a result, close to 900,000 took time off and nearly half a million resigned. In addition, 300,000 employees were dismissed due to conflict. According to the report, the management and resolution of such conflicts costs employers a staggering £28.5 billion every year. However investment in early intervention and measures to promote effective resolution of disputes can save businesses time and money and reduce the risk of potentially damaging litigation.

What are common reasons for employment tribunal claims?

Common claims include:

unfair dismissal
disputes relating to redundancy
breach of contract
discrimination (for example on the grounds of disability, gender, race, sexual orientation or other protected characteristic)

Managing conflict in the workplace: How to avoid a legal dispute

If workplace issues are not dealt with promptly, they may escalate rapidly and result in legal claims against you. According to a CIPD survey, one key thing employees want from their employers when they raise an issue is simply to be listened to.

Just under a third (31%) of respondents to the survey said their employer didn’t take them seriously when they raised an issue, while nearly half (48%) said they felt their employer had prioritised the other party’s interests over their own.

Listen

One of the most important things you can do is take issues raised seriously and give any employee who is angry or frustrated the time they need to talk about what has happened. Speaking with them privately, actively listening to their views and acting upon the complaint swiftly can be key to preventing disputes and conflict from intensifying.

If a formal grievance procedure or disciplinary process is required to effectively deal with the matter, then it should be initiated as appropriate with careful regard for your internal procedures and ACAS Code and guidance as applicable.

Take advice

Employers should take professional HR and legal advice at an early stage to ensure they can make informed choices about how to manage conflict and disputes effectively and in accordance with current employment law requirements. Employers may unwittingly fall foul of the law when they fail to seek legal advice, for example behaving in a way they do not realise may be discriminatory.

Having an employment law solicitor on hand who has an in-depth understanding of the complexities of your case can go a long way to solving grievances before they have a chance to escalate. Even if the relationship between the parties breaks down, legal professionals will ensure you conduct yourself in a way that gives employees few grounds for taking their complaint further.

Be fair

It is imperative that you can demonstrate a fair process has been followed when dealing with the dispute or grievance and that any decision makers consider matters objectively and based on the evidence before them. Your solicitor can advise you on how best to deal with the issue in a neutral and unbiased manner.

Keep a paper trail

Whether you are investigating a grievance, initiating disciplinary proceedings against an employee or dismissing a staff member, you should keep a clear paper trail as evidence. This includes records of meeting invitations and detailed notes of what was said, in addition to any emails sent or received.

If the case does proceed, you will be able to provide hard evidence that you have acted appropriately.

What happens if I am taken to an employment tribunal?

To submit a claim, your employee will normally first have to notify ACAS that they intend to do so. They will try and help you resolve the issue through a process called early conciliation, whereby they support both parties to negotiate settlement terms. I f neither party wants to attempt early conciliation, or the process fails, then your employee can then submit an ET1 claim form to which you will have 28 days to respond with your defence.

Our employment law solicitors have many years’ experience in helping employers respond successfully to claims, assisting them to prepare the documentation and evidence needed to respond to the claim and representing them at hearings.

Should I offer my employee a settlement agreement?

A settlement agreement (formerly known as a compromise agreement) can be used to resolve a dispute and allow all parties to draw a line under matters and part company on a dignified basis.

The agreement typically offers your employee a severance payment in exchange for their agreement not to take any further legal action against you. However, it is important to take legal advice to ensure this is a viable option in the circumstances and how best to make an offer as you may otherwise prejudice your position.

If you offer a settlement agreement without following the right process, and your employee rejects it and goes on to make a claim anyway, any conversations you had regarding the settlement agreement can potentially (but not always) be used as evidence against you.

What are the types of employment tribunal hearing?

There are two main types of hearing:

Preliminary hearing: this is usually a short hearing to address any issues so that the case can proceed smoothly before a full hearing, this may include:

clarifying the issues in the case
establishing what documents and or witnesses are required
deciding questions of entitlement to bring or defend

Full hearing: is when all the evidence is heard:

decides whether the claim succeeds or fails
and, if it succeeds, what remedy is appropriate

What happens when a grievance is upheld at an employment tribunal?

The tribunal will order specific steps to be undertaken at a ‘remedies’ hearing. This could include:

reinstating your employee
paying out compensation
paying for loss of earnings/damages

If you fail to take these steps, you can be taken to court and forced to comply. Usually, though not always, the parties bear their own costs.

It is important to remember that the likelihood of winning is greatly increased with professional legal support.

Supportive employment law professionals

Whether you are looking for support in getting the correct policies and procedures in place, or dealing with a formal grievance, we can help. We know that every case is different, so our advice will be tailored to your circumstances.

If you are in a dispute with an employee, you need to ensure things are dealt with without delay. Taking legal advice promptly could mean the difference between winning your case and damaging your business’s reputation.

Give us a call for a confidential discussion about how we can help you defend yourself, your business and your reputation.

Resolving high-income divorce challenges and future income concerns

Posted on 13 August 202023 March 2025 by Sarah O'Sullivan

The division of assets is one of the main issues to resolve during divorce proceedings. For people with very high incomes and substantial assets, and their spouses, being able to reach a fair financial settlement is, understandably, a key concern, given the number of potentially complicating factors and levels of income that need to be taken into account.

Decisions as to what happens to future income is often where there is most difficulty in reaching an agreement in a divorce settlement involving a high-earning spouse. This is particularly so where complex reward structures are involved that are not fully understood by one if not both spouses.

Failure to fully take into account incentive and performance reward packages can have significant implications on the outcome of a divorce settlement and risk restricting either party’s choices in the future, so you must seek specialist legal advice.

Incentive payments and performance payments not yet realised

There may be circumstances where there are financial resources in place through incentive and performance reward packages which originated during the marriage, although they are not immediately available at the time of the divorce settlement.

Such financial resources may well be shared in a divorce to achieve fairness between the earning and non-earning spouse.

Incentive and performance reward packages are aimed at attracting and retaining the best talent and are likely to be nuanced from firm to firm and industry to industry. However, enhanced remuneration structures do tend to follow certain themes, such as:

Share options (or stock options)

Share option schemes are typically used as an incentive for employees. A share option is the right to buy a certain number of company shares at a fixed price at some point in the future. Share option schemes often come with tax incentives.

There are different share option schemes you may come across such as Company Share Option Plans, Enterprise Management Incentives, Nil-Cost and Nominal Costs Options, Share (Stock) Appreciation Rights, Sharesave Share Option Schemes and ‘Phantom’ Options.

Long-term incentive plans

A long-term incentive plan (LTIP) is a term that is commonly used among listed companies to describe executive share plans under which a company makes share-based awards to senior employees with a vesting period of at least three years. Such structures are also often called ‘performance shares’ or, in the US, ‘restricted stock units’.

Again there are often tax efficiencies to these schemes. LTIPs are not restricted to rewards in shares; cash also features in these reward structures.

Management incentive plans

A management incentive plan (MIP) most often refers to a scheme where the equity is allocated to senior management in a privately owned business. The company is likely to be owned by a private equity house and the equity would vest with the senior management in the event the private equity house sells its share the business or the company is floated on the stock market.

Performance bonuses

A form of additional compensation paid to an employee or department as a reward for achieving specific goals or hitting predetermined targets. A performance bonus is compensation beyond normal wages and is typically awarded after a performance appraisal and analysis of projects completed and/or financial targets met by the employee over a specific period.

Sharing of payments – what to consider?

There is a distinction to be made between those sums payable under such incentive or performance schemes which realise a value in the future with no further input from the earning spouse and those which require further endeavour after the marriage is over to realise their maximum potential.

This will affect how the income derived from such sources will be treated in a divorce settlement.

The timing of payments will also be a consideration. A performance bonus might be shared if it is awarded close in time to the end of the marriage, however, it is less likely to be shared if awarded well after the relationship is over.

As a general rule, it is possible to share in the benefits of such schemes even following divorce, however, consideration will be given to the value or opportunity which arose during the marriage against any extra input required by the earning individual to realise an enhanced value at a later date and whether this can be justified by reference to needs.

Future maintenance provisions

It is not always the case that in divorce, one party must pay the other an amount out of their income in the future. There has been a general movement away from maintenance being “for life,” with courts preferring to award maintenance as a shorter-term stepping stone to help the non-earning spouse transition into financial independence. In some circumstances, long-term maintenance can be required as part of a fair outcome in a divorce.

There are two classes of maintenance – child maintenance and spousal maintenance. The two combined are often referred to as global maintenance. Where spousal maintenance features, a settlement or court order tends to be based on two principles:

what each party might need to live on in the future;
whether it is appropriate for each party to share in future financial resources.

It should be stated that future earnings or earning capacity, whilst relevant, is unlikely to be considered a matrimonial asset to be shared and so ongoing maintenance must be linked to a demonstrable income ‘need’ rather than a sense of entitlement or sharing.

Complex arrangements require specialist advice

The issue of the future value of income in divorce proceedings is complicated for both the earning and non-earning spouses, and specialist advice should be sought as soon as possible.

At Tees, our expert legal advisers work to ensure a fair financial settlement so that future needs can be met according to the financial resources available. We also work closely with financial advisers in our Wealth Management team where needed. They will ensure that any future financial planning considerations are taken into account so you both have a clear view of your financial future.