Legislation has been introduced in Parliament to upgrade UK workers’ rights.

The legislation is wide ranging with the intention of tackling poor working conditions and benefitting businesses. A summary of the main changes are:

• The existing two-year qualifying period for protections from unfair dismissal will be removed, delivering on the Labour manifesto commitment to ensure that all workers have a right to these protections from day one on the job.
• The government will also consult on a new statutory probation period for companies’ new hires. This will allow for a proper assessment of an employee’s suitability to a role as well as reassuring employees that they have rights from day one, enabling businesses to take chances on hires while giving more people confidence to re-enter the job market or change careers, improving their living standards.
• The bill will bring forward 28 individual employment reforms, from ending exploitative zero hours contracts and fire and rehire practices to establishing day one rights for paternity, parental and bereavement leave for millions of workers. Statutory sick pay will also be strengthened, removing the lower earnings limit for all workers and cutting out the waiting period before sick pay kicks in.
• Accompanying this will be measures to help make the workplace more compatible with people’s lives, with flexible working made the default where practical. Large employers will also be required to create action plans on addressing gender pay gaps and supporting employees through the menopause, and protections against dismissal will be strengthened for pregnant women and new mothers. This is all with the intention of keeping people in work for longer, reducing recruitment costs for employers by increasing staff retention and helping the economy grow.

A new Fair Work Agency bringing together existing enforcement bodies will also be established to enforce rights such as holiday pay and support employers looking for guidance on how to comply with the law.

Employers and employees who would like more information on the scope of the new legislation can view a Department for Business and Trade press release at https://www.gov.uk/government/news/government-unveils-most-significant-reforms-to-employment-rights.

Banks will be granted new powers to delay and investigate payments suspected of fraud, enhancing consumer protection against scammers.

Under new laws being proposed by the Government, banks will be able to extend the maximum delay for suspicious payments by up to 72 hours when there are reasonable grounds to suspect a payment is fraudulent and additional time is needed for investigation. Under the current regulations, banks are required to either complete or reject a payment by the close of the next business day.

This extended time frame will allow banks more opportunity to disrupt fraudsters' influence over their victims and help combat the estimated £460 million lost to banking fraud in the last year.

The Economic Secretary to the Treasury, commented:

Hundreds of millions of pounds are lost to scammers each year, targeting vulnerable communities and ruining the lives of ordinary people.

We need to protect these people better, which is why we are giving banks more time to investigate suspicious payments and break the criminal spell that scammers weave.

Banks that have reasonable grounds to suspect a payment is fraudulent will be required to notify customers when a payment is delayed as well as to provide instructions on what actions the customer needs to take to unblock the payment. Banks will also be obligated to compensate customers for any interest or late payment fees incurred due to payment delays.

New regulations that prohibit employers from withholding tips for employees in the hospitality, leisure, and services sectors took effect on 1 October 2024. This change follows the enactment of The Employment (Allocation of Tips) Act 2023, commonly referred to as the Tipping Act, along with the statutory Code of Practice on the fair and transparent distribution of tips, which also took effect on 1 October 2024.

This means that more than 2 million workers will have their tips protected. HMRC has estimated that this new law will mean an estimated £200 million a year will go back into the pockets of hard-working staff by retaining tips that would have otherwise been deducted. These new measures apply in England, Scotland and Wales. Employment policy is devolved to Northern Ireland.

Employers who violate these rules could face fines or be required to compensate their staff. Workers will have the ability to hold their employers fully accountable through employment tribunals.

The statutory Code of Practice provides businesses with advice on how tips should be distributed among staff. The Code of Practice is statutory and has legal effect, meaning it can be introduced as evidence in an employment tribunal.

The GOV.UK ID Check app is used to allow applicants to verify their identify when they sign in to a government service with GOV.UK One Login. Once this had been completed satisfactorily, your identity information is automatically saved to your GOV.UK One Login. This means you will not need to prove your identity next time a service needs to check who you are.

The app is available on both iPhone and Android platforms and will check that:

• your photo ID is real
• you are a real person
• you are the same person as in your photo ID

You also need one of the following types of photo ID:

• UK photocard driving licence
• UK passport
• non-UK passport with a biometric chip
• UK biometric residence permit (BRP)
• UK biometric residence card (also called a BRC)
• UK Frontier Worker permit (FWP)

If you are unable to prove your identity using the app there are also options to answer security questions online about things like your mobile phone contract, and any bank accounts, credit cards, loans or mortgages you may have. There is also a further option of using a Post Office that offers ‘in branch verification’.

There are special VAT reverse charge rules in place for certain building contractors and sub-contractors. These regulations, which came into effect on 1 March 2021, make the supply of most construction services between construction or building businesses subject to the domestic reverse charge. The reverse charge only applies to supplies of specified construction services provided to other businesses within the construction sector.

If you are VAT registered in the UK and supply services to the building and construction industry, you must use the VAT reverse charge if the following conditions are met:

• Your customer is registered for VAT in the UK.
• Payment for the supply is reported under the Construction Industry Scheme (CIS).
• The services you provide are standard or reduced-rated for VAT.
• You are not an employment business supplying staff or workers, or both.
• Your customer has not provided written confirmation that they are an end user or intermediary supplier.

When these rules apply, sub-contractors do not add VAT to their supplies for most building customers. Instead, contractors are responsible for paying the deemed output VAT on behalf of their registered sub-subcontractor suppliers. And note, contractors can then reclaim the same amount of VAT as input tax on their VAT return, subject to the usual rules. In effect, contractors are paying their subcontractors' VAT to HMRC and then claiming it back on the same VAT return.

It is important for businesses to understand and comply with these rules in order to avoid potential penalties from HMRC.