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Top 5 HR trends for 2022

Hannah Blood, Associate - Walker Morris

As many businesses have been wrestling with the practicalities of Covid-19 (and continue to do so), forward-planning for ‘the workforce’ has in recent past perhaps not been at the top of the agenda. However, as we see businesses settle in to their new ways of working – the so-called ‘new normal’ – we have picked out five things we feel businesses need to have at the forefront of their minds this year.

  1. Employment Bill – will 2022 finally be the year?

We have been waiting for movement in the Bill for two years (delayed due to the pandemic). In anticipation that this year will be the year of progress, we have summarised some of the changes we expect to be covered (or at the very least proposed):

  • A single labour market enforcement agency for vulnerable workers’ basic rights
  • Restrictions on the use of non-disclosure provisions in employment or settlement agreements
  • Mandatory ethnicity pay gap reporting
  • Restrictions/changes re post-termination non-compete clauses (such as requiring mandatory financial compensation for the duration of the restriction)
  • Extension to the ban on exclusivity clauses from zero-hours workers to all workers
  • One week’s unpaid leave for employees with caring responsibilities
  • 12 weeks’ paid neonatal leave for employees with premature or sick babies
  • Making flexible working the default position (i.e. from day one) unless an employer has a good reason
  • Redundancy protection from the point an employee notifies their employer of their pregnancy until six months after the end of their maternity leave
  • Employer’s duty to prevent sexual harassment
  • An extension from three months to six months to bring any discrimination claims
  • Clarification re the employment/worker status test
  • Right to request a more predictable and stable contract for workers with variable hours after 26 weeks’ service
  • Fair and transparent distribution of tips and services charges amongst workers
  1. Diversity & Inclusion – keep it up

Whilst D&I is obviously a wider concept than just following the law (adverse publicity for businesses who have fallen foul have clearly shown that) it is noteworthy that many items in the Employment Bill could be said to fall under the D&I heading.  The net effect is that if your business wasn’t already convinced of the ethical and business case for good D&I (not least for retention and recruitment), legislation is likely to only amplify the case.

If D&I initiatives have gone quiet within your business, it is important that these are reignited. Education and training (starting at the top) are key to both the positive aspects (actually creating a more diverse workforce) and the negative (defending the business if things go wrong).

  1. Worker status – much needed clarity

A person’s employment status helps determine their rights and your responsibilities as their employer; they may be a worker, an employee, a self-employed individual/consultant, a director or an office holder, each of which presents its own nuanced set of rights and responsibilities. However, determining employment status in this day remains a challenge and the penalties are only increasing (whether that be for tax and NMW (via HMRC), employment rights via the Tribunals or entitlement to auto-enrolment (involving the Pensions regulator)). The media spot-light also remains undimmed.

The government stated back in 2018 that they were to legislate to improve the clarity of the employment status tests.  However, three years later, we are still waiting on a response to the government-commissioned independent research on the matter. As touched upon above, maybe all will be made clear in the Employment Bill?   In the meantime, we will keep you updated on the various potentially significant cases that are due before the courts and we would recommend that businesses audit their own workforces to fully understand where any risks might lie.

  1. Recruitment and retention

We have all read articles on the “Great Resignation” with many workers (young and old) saying goodbye to their pre-pandemic roles and seeking a change, resulting in a shortage of workers in the labour market (haulage, care sector and hospitality to name but a few). Whilst we can clearly point the finger at two likely reasons (Brexit and Covid-19), what can businesses do to tackle the issue?  We would suggest a combination of:

  • Visas and work permits – large scale migration may not cause or solve labour shortages, but it can help with the temporary shortages in some industries, and sponsored migrant workers can fill suitable skilled roles. The granting of visas to international HGV applicants is one temporary measure adopted by the government. Even if you are not impacted by these specific measures, getting on top of what you can and can’t do re immigration is sensible, especially whether a sponsor licence could help.
  • Re-think recruitment and ways of working (see ‘Remote Working’ below).
  • Invest in your employees – offer training and provide for career development, skills and educational investment.
  • Consider LTIPs (long term incentive plans) for key people – reducing the incentive for them to leave. Some schemes have good tax advantages as well.
  • Consider post-termination restrictions (to make it harder for people to leave, but bearing in mind any potential changes under the Employment Bill!).
  1. Remote working

Remote working has accelerated since the ‘work from home’ restrictions first came in to play in March 2020 and some home/remote working is likely to be here to stay.

While we expect that employers will be more willing to consider hybrid working as a viable option and may even begin to encourage it because of the benefits it can bring to employees and employers alike, there is a balance to be struck. Many employees have found that working from home during the pandemic has blurred the lines between work and home life, created an environment where there is a constant need to be ‘connected’ and in turn, have suffered mentally and physically.

With that in mind, businesses should review whether they are dealing with the flexible/hybrid working model effectively: take a collaborative individual-focussed approach (as one size does not fit all); encourage employees to set boundaries (communicate contactable hours by way of email footers, for example); and set out expectations and lines of communication by way of a flexible/hybrid working policy.  Businesses also need to be mindful of the likely changes coming via the Employment Bill and the need to factor in D&I issues at the same time as not falling into bear-traps that exist if people are allowed to work overseas.

With all of the above (and the list could easily have had more than 5 headings!), there is a lot to make 2022 a busy and interesting year in the HR community!

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