Important changes to employee legislation

23 March 2020

The government’s Good Work Plan takes effect from 6 April 2020, and requires organisations to provide extra information in the written statements of terms it sends to employees and workers.

This new legislation also introduces for the first time a requirement for all workers and employees to have certain information provided to them in writing in a single document. This document is often referred to as a section 1 statement (referring to section 1 of the Employment Rights Act 1996).

The current requirements for a written statement include basic information such as payment details and working hours. The additional information, which will be legally required from next month, is set out in the government’s guidance, in the Clarity of Information section.

The new requirements will mean information on additional elements such as probationary periods, paid leave, benefits and training will also need to be provided. This will apply to employees and workers whose employment or engagement begins on or after 6 April 2020, and the written statement must be sent before their appointment starts.

It is important to note that employees and workers will need to be provided with different section 1 statements that reflect their status. If this is not carried out, organisations may inadvertently create contractual employee rights for a group of individuals they consider to be workers. 

How this affects arrangements with board members

The NHF’s position is that board members are (most likely) workers in legal terms. Our Board Member Pay publication, published in 2014, included a template Agreement for Services that housing associations could adopt and use in their own agreements with board members.

In partnership with Devonshires Solicitors, we will be updating this publication over the coming weeks. We will update the template agreement which is appended to it, so that it includes everything it needs to for your organisation to be compliant with the new obligations. 

We are planning to publish the updated edition later in the year, but in the meantime please do not use the template agreement contained in the current edition without taking advice first. Please note that this new requirement does not apply retrospectively and you do not need to provide current board members with a new agreement.

When updating our Board Member Pay publication, we will be using the opportunity to understand and share what has changed in housing associations’ approach to the remuneration of board members, including exploring the issues arising where board members supply their services to housing associations via a personal service company.

Please note that this new legislation applies to all workers, not only board members, and all organisations should be prepared for these changes.