Employee onboarding and the Good Work Plan legislation

On April 6th, the way that employers are legally required to process new hires changed.

They are important changes that have taken place at one of the worst possible times for hiring teams who are having to deal with the fallout of the coronavirus pandemic.

Despite the disruption, employers need to know exactly what’s changed and to make sure their employee onboarding process meets all of the new requirements.

Here’s what you need to know:

What is the Good Work Plan legislation?

The Good Work Plan is a term used to cover a wide range of changes to UK employment legislation. The overall aim of the changes is to create fairer and more transparent relations between employers and workers.

The overall changes cover a range of areas including worker’s rights, holiday pay and contractual obligations. This legislation came into effect on April 6th, 2020.

What impact do the changes have on onboarding?

There are four key areas where the Good Work Plan legislation affects the employee onboarding process. These are:

  1. Delivery of contractual information

Before April 6th, employers were given some leeway when it came to providing new hires with basic contractual information. The legislation refers to this as a ‘written statement of employment particulars’.

Employers were given two-months after a person had started to provide them with these details. The Good Work Plan removes this grace period with info having to be provided on or before the day a person starts their role.

Actions

Make sure that your onboarding process ensures that new starters have basic contractual information before they start. This can become a particular challenge if large numbers of hires are needed to quickly fill positions.

With cloud-based onboarding tools, automated checks and alerts can be used to ensure admin tasks are completed before a person starts.

  1. Contents of contractual information

Good Work Plan also changes what needs to be included when sharing a ‘written statement of particulars’. In addition to the existing basic details, such as job role, pay and holidays, some additional areas need to be covered. These are:

  • Providing typical patterns of working hours/days
  • Indicating any variability in hours/days required
  • All forms of remunerations and benefits – not just pay
  • Information on any kind of training required
  • Details of any probationary periods/requirements

Actions

Contracts and offer letters need to be reviewed and revised to ensure that they are meeting the new requirements. With many roles now becoming remote, clear information needs to be provided on working hours and schedules.

  1. Handling of agency workers

The Good Work Plan requires employers to provide agency workers with a ‘key information document’. This needs to include basic information such as:

  • Type of contract they are on
  • Identity of the business paying them
  • Pay rate
  • Holiday entitlements
  • Additional benefits

This document is in addition to the ‘written statement of employment particulars’ that they should also receive on or before their first day in the role.

Actions

Onboarding processes need to be reviewed to ensure that agency workers are receiving the information they are legally entitled to. As ‘key information documents’ were not previously required, they will need to be created.

  1. Protocols for tax starters

This was the most confusing and contentious area of the Good Work Plan changes. It relates to a change to the IR35 tax rules which makes some employers responsible for determining the correct tax status of their new starters.

The onboarding process would have to inform incoming workers of the tax status allocated to them and why, via a Status Determination Statement (SDS).

At the last minute, however, this change was postponed until 2021. In doing so, the UK Government made it clear that the legislation was being delayed rather than scrapped.

Actions

The delay buys some valuable time for hiring managers to get to grips with this troublesome area. Expert advice is required to check the requirements and to put a compliant process in place.

What happens if you breach Good Work Plan laws?

The legislation includes an update to the penalties that can be imposed on companies that are found to have breached employment laws. This is now raised from £5,000 to £20,000.

While prosecutions are likely to be relatively rare, a more significant risk is from the potential cost and disruption that’s caused by industrial tribunal claims. If proper onboarding processes have not been followed, employers leave themselves exposed when defending claims. 

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