Looking forward to 2021: Key employment issues for UK Hotel & Leisure employers

By Alison Dixon, Stephanie Creed

02-2021

2020 has been a tough year for Hotel & Leisure employers in the UK, as elsewhere in the world.  This article looks at the employment-related developments and changes you need to be aware of for the 12 months ahead, in order to best position and protect your business.

New UK Immigration Rules

With the end of the Brexit transition period on 31 December 2020 and the UK’s official exit from the EU, there are significant immediate implications for immigration and right to work requirements.  Given the importance of this area for recruitment and staffing in the Hotels and Leisure sector, employers will need to take action now. 

The new UK Immigration Rules are designed  to attract ‘skilled workers’ and therefore  it will be much more difficult and expensive to recruit and employ workers from overseas. 

  • From January 2021, EU nationals will require a work visa under the new Immigration Rules if they want to work in the UK and are not eligible under the EU Settlement Scheme.  Staff should already be aware of these changes, but regular, clear communication will be key to managing both affected staff and meeting the needs of the business.
  • Under the new rules, the skill level for the Tier 2 (Skilled Worker) route has been changed – for the Hotels and Leisure sector, this means that many of the lower-skilled roles will not be covered so cannot be filled by EU nationals who do not have a pre-existing right to work in the UK.  Employers will need to look deep into the resident labour market to fill these roles.
  • As of January 2021, UK nationals will need to count the days spent in a Schengen zone for business trips as there is a limit of 90 days’ stay in any given 180 day period.
  • We are seeing a number of employers permitting remote working from overseas locations or looking at virtual mobility programmes in light of Covid limitations.  Both of these present a number of employment, immigration and tax challenges which should be examined carefully.  

Given the complexities, we have prepared a series of articles and short videos providing the key information that you need to plan ahead and protect your business.

Covid: Furlough and the Coronavirus Job Retention Scheme 

The government has issued a new Treasury Direction and updated guidance regarding the Coronavirus Job Retention Scheme (“CJRS”), which is likely to be of importance for employers in the Hotels and Leisure sector.

The Treasury Direction largely formalises the previously announced details of the extended CJRS, now set to run until 31 March 2021, and sets out further details of how the scheme will operate until 31 January 2021. A further direction covering the period February and March 2021 is expected shortly.

For further details, see our dedicated In Focus page.  If you would like to be added to our regular Covid briefings, giving you an update on Covid-related developments around the world, please contact your usual Bird & Bird contact.

IR35 & off-payroll workers

Reforms to the IR35 rules on off-payroll working in the private sector come into force on 6 April 2021, having been delayed by a year due to the coronavirus crisis. The rules were introduced to ensure that individuals who work like employees are subject to broadly the same employment taxes as employees, and apply to anyone who provides their services via an intermediary, such as a personal service company.  

For further details of the changes, and the implications for your business, please see this guide.

Minimum wage and other statutory rates: Updates

From April 2021, the rate of the national minimum wage and national living wage will rise as set out below.  The qualifying age for the national living wage is changing from 25 and over to 23 and over, so this higher rate will cover a larger cohort of workers.

Age of worker

23 and over

21 to 22

18 to 20

Under 18

Apprentice

Hourly rate from April 2021

£8.91

8.36

£6.56

£4.62

£4.30

Current hourly rate (April 2020)

£8.72

£8.20

£6.45

£4.55

£4.15

As of 4 April 2021:

  • the statutory sick pay (“SSP”) rate will increase to £96.35 per week; and
  • the rate for statutory maternity, paternity and adoption pay and the rate for statutory shared parental pay will increase to £151.97 per week.

Diversity and equality

Diversity and equality will remain key points of discussion for employers over the next twelve months.

  • Employers of a certain size will be subject to modern slavery and/or gender pay gap reporting obligations.  Aside from the legal implications of failing to comply, employers run the risk of significant reputational harm and damage to employee relations through failure to take steps to improve their record on these issues.
  • The UK government had previously indicated that it would look at bringing in ethnicity pay gap reporting requirements back in 2018/2019.  Whilst nothing further has been said on this recently (perhaps in light of the developments in 2020), this may move back on to the agenda for 2021.
  • Arguably, the events of 2020 have brought ethical concerns further to the fore for businesses, and have highlighted the additional steps employers may need to take, or may be expected to take, in order to support their employees.  Our Global Diversity Guide covers legal obligations, accepted practice and permitted actions, with a particular focus on how you can use data to assist you in this, and our Ethical Workplace series explores some of these topics, including mental health, domestic violence in the workplace and the role of data in planning and implementing employee diversity programmes, in more detail.  

Other key developments for Hotels & Leisure Employers  

  • The UK government has indicated that it remains committed to introducing legislation and measures to ensure that tips left for workers go to them in full.
  • The government has also indicated that redundancy protection for pregnant employees and new parents may be extended. The government consulted in 2019 on extending redundancy protection (i.e. the right to be offered suitable alternative employment) for employees taking maternity leave and for other new parents.  It committed to extending the period of protection so that it would apply from the point the employee informs their employer that they are pregnant and continue for six months after their return to work.
  • Other employment law developments that the government has previously announced but has not yet set out a timetable for include:
    • a new right for parents to take extended leave for neo-natal care;
    • a right for carers to take one week’s unpaid leave per year;
    • a new right for all workers to request a more predictable contract; and
    • an increase (from one week to four) to the length of time required for continuity of employment to be broken.