Two important government consultations relating to employment law close in March 2023. We look at the key proposals of both.

  1. Consultation on calculating holiday entitlement

A government consultation on calculating holiday for part-year and irregular hours workers will close on 9 March 2023.

It proposes introducing a fixed 52-week holiday entitlement reference period including weeks in which no work is performed. This is with a view to ensuring that holiday entitlement and pay is more aligned with the actual time spent working during the holiday year.

The consultation follows the Supreme Court decision in Harpur Trust v Brazel, which held that holiday entitlement under the Working Time Regulations 1998 for permanent part-year workers should not be pro-rated so that it is proportionate to the amount of work that they actually perform each year.

As a result of this judgment, the common 12.07% calculation of holiday entitlement for part-year workers is incorrect and such workers are now entitled to a larger holiday entitlement than part-time workers who work the same total number of hours across the year.

The government is keen to address this disparity and the proposed legislation would effectively reintroduce the 12.07% calculation with a view to providing employers with clarity.

  1. Consultation on removing the bonus cap

The FCA and PRA joint consultation on removing the cap that currently applies to bankers’ bonuses closes on 31 March 2023. We have written about this previously here.

Regulated financial services employers should also look out for the upcoming FCA Policy Statement on diversity and inclusion as well as the call for evidence on the Senior Managers & Certification Regime, which is expected in early 2023.


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