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Staffing industry legal news – February 2019

To help you stay on top of the latest legislation, we’ve teamed up with International Compliance Experts (ICE), specialist providers of international compliance consultancy to the staffing industry. Together we’ll bring you news of the legal updates that impact the world of work.

Here’s what’s been happening over the past few months:

United Kingdom

What to watch out for in the next couple of months

Some of the expected changes to come into force during 2019 in the UK are: 

  • National Living Wage and National Minimum Wage rates to increase from April 2019.
  • EU nationals to be able to apply for settle status during 2019 provided they have been living in the country for 5 years by the date of application. Pension auto-enrolment contributions to increase from April 2019: employers will have to contribute a minimum of 3% and employees will have to contriubte 5% of the worker’s pre-tax salary
  • Also from April 2019 those in the UK engaged under the ‘worker’ status will also be entited to receive a payslip. Those paid according to time worked will also have to have their total number of hours worked clearly stated on their payslips.
  • Gender pay gap reporting will be submitted by the second time by companies with 250 or more employees, however this is viewed as the true test as figures are expected to be scrutinised more heavily and a true assessment of the company’s efforts to successfully address any significant pay disparity highlighted in 2018 to be considered by the authorities. The submission deadline is the 30 March 2019 for public sector organisations and 4 April 2019 for private companies and charities.
  • 2019 will also see new legislation coming into force requiring companies with 250 or more employees to publish their executive pay gap. The reports will be published in 2020 but figures are to be calculated throughout 2019 in order to show the gap between the total amount paid to the company’s CEO and the average pay for an employee. 


Gig economy employers face further challenges

Following its decision to cease operations in country, Foodora faced many challenges before it could see the end of 2018. After reports emerged that the company was facing accusations from the Fair Work Ombudsman (the Australian workplace watchdog) over sham employment practices, it was also revealed the food courier firm had been chased by the Tax Office in New South Wales for unpaid superannuation, penalties and interest. In November the company saw its many problems further increase after the Fair Wok Commission ruled that one of its riders was an employee as opposed to a contractor, meaning the rider had been unfairly dismissed and was, therefore, owed compensation. The ruling will certainly have a wider effect on other local gig economy employers. 

Those who operate in country and utilise the services of contractors should note that the control exercised by Foodora over the worker (mainly with regard to place and working times) was one of the main points picked by the court as an indication of the existence of an employment relationship between the parties. 


Various statutory benefits to be extended to all workers 

As of April 2019 the Employment Act will have some significant amendments made to it in order to guarantee greater statutory benefits to all professionals, managers and executives (typically referred to as PMEs) irrespective of salary levels (currently restricted to those earning SGD4,500 or less per month). Wrongful dismissal rights and recourses are also to be enhanced. 

A Tripartite Workgroup has made a number of recommendations in order to address gig economy workers and freelancers, all of which have been accepted in principle by the local government – so there is certainly a lot to watch out for in the coming months. Employers should also start preparing themselves to update employment contracts and policies to reflect the additional rights that employees will be entitled to as of the start of Q2. 


New program for attracting foreign skilled workers 

In a bid to tackle skills shortage in country, the Danish Ministry of Employment presented at the beginning of October a 21-point program to help companies hire foreign skilled workers. In order to be eligible for the program, workers must be paid at least DKK330,000. The measures aim to streamline the application process for foreign workers, but the government has pledged to stay on top of migration controls and manage the influx of expatriates. 

The opposition party criticisd the initiative, stating the country should be focusing on the education of its young people, developing unskilled workers and supporting women who currently only work part-time. However, the government was backed by the Confederation of Danish Industry that highlighted the need for the country to work on all fronts (increasing efforts to train local workers, but also bringing workers from within the EU as well as outside) in order to attract the required numbers of skilled and qualified employees. 

More details of the plan can be found on the Danish Ministry website


The end of endo? 

President Rodrigo Duterte certified as urgent a bill aiming to stop endo (end of contract labour scheme – that is, short-term labour contracting *), however in November 2018 some members of the Senate called the government to lead by example and stop the practice within the public sector first, so the private sector can follow suit. It is estimated that the government needs to regularise more than 600,000 contractual employees (COS or contract of service and job order or JO workers). 

It is expected that once passed the law will prohibit labour-only contracting and limit job contracting to licensed and specialised services. The changes would also result in the classification of workers into regular and probationary employees;  project and seasonal employees would be treated as regular employees. Those operating in country are advised to monitor the situation as the bill is still to be approved by the Senate. 

*The practice involves terminating workers’ contracts before their situation has to be fully regularised after six months. Many employers termiante workers’ contracts after a five-month period and then re-issue a new contract, therefore never having to provide the workers with full employment benefits and protections. 


GDPR transposed into local law 

The new Data Protection Act was published in Spain in December 2018, finally transposing the EU GDPR into Spanish Law. With it, a number of digital rights have been introduced, including the ones listed below, which directly affect employees: 

  • The right to privacy in the use of technological devices at work; 
  • The right to disconnect from work; and 
  • The right to privacy against the use of sound and video suveilance and geolocation technology. 

The digital rights were deemed necessary considering the fact that a large part of the professional activities are performed via the internet so these rights were considered fundamental in this new reality. 

Hong Kong

Labour reforms confirm regional trend of enhanced rights for workers

 A number of reforms to the local labour law took place during 2018, continuing to slowly improve employee protections, a trend seen across many jurisdictions in the region. Employers operating in country should ensure they are keeping up with these and implementing the required changes, such as the increased statutory paternity leave which went from three to five days in November, with the change taking effect as of 18 January 2019. Companies should also note that statutory maternity leave of 14 weeks (previously 10 weeks) was implemented among civil servants in October 2018; it is expected the increase will be extended to other sectors still in 2019. 

Another point of interest is the Discrimination Legislation Bill, which includes a provision to extend protection for service providers against disability and racial harassment by customers. It is expected that the proposed bill - which was published in November 2018 - be further debated and approved in late 2019. 

Finally, companies should watch developments to the government’s new proposal to abolish by 2024 the offsetting arrangement in relation to the MPF (Mandatory Provident Fund) in order to improve retirement protection for HK employees.  

For more legal news in other areas of the world including Cambodia, Nigeria and Vietnam please contact us for further information. 
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