Are UK HR departments ready for the legal hurdles of 2021?

The Covid-19 pandemic made 2020 a truly challenging year for HR professionals, who found themselves coordinating huge changes like the Coronavirus Job Retention Scheme (CJRS) and the transition to remote working. However, 2021 will present its own set of difficulties for the HR sector, specifically the key legal issues arising from the IR35 reform, the end of the Brexit transition period, and the continuation of the CJRS and hybrid working. 

To learn more about the legal challenges approaching the HR sector in 2021, Katherine Jackson, Regional Director for Michael Page Legal, recently hosted a webinar with Miriam Lampert and Supinder Sian, Employment and Business Immigration Partners at Squire Patton Boggs. Miriam and Supinder discussed the various legal challenges facing HR professionals over the next year and how they can get ahead of the curve in confronting them. 

Miriam kicked off with a discussion of the IR35 reform, which comes into effect in April 2021. The regulation will require large and medium sized end-user client companies to determine whether their use of a contractor falls inside IR35; if an assignment is determined to be inside IR35, the contractor will be subject to PAYE and will need to pay the same national insurance and tax as a regular employee, which the employer will be responsible for deducting.

If end-user clients are ultimately the people paying the PSC, there will be a whole range of implications.

Miriam Lampert
Employment and Business Immigration Partner, Squire Patton Boggs

The Covid-19 pandemic will also continue to present major challenges, especially in the labour market. Following the Chancellor’s recent extension of the CJRS to April 2021, businesses must monitor government guidance to ensure optimal use of the scheme and prepare for its eventual unwinding. The other major impact of the pandemic on the labour market - the rapid normalisation of hybrid working - will likewise require careful attention from HR departments as obligations regarding staff home-working costs and health and safety continue to develop.

Moreover, the end of the Brexit transition period will introduce a new set of rules to the UK labour market. Freedom of movement as we know it will come to an end, particularly impacting EU nationals residing in the UK under the EU Settlement Scheme, business travellers to the UK, and satellite employees. Given this, it is essential that HR professionals in the UK are familiar with the rules of the new points-based system and its impact on businesses and employees.

Topics covered by Miriam and Supinder in the webinar included:

  • Post-Brexit UK immigration
  • IR35
  • What is to come from the furlough scheme
  • Legal issues relating to home working/hybrid working