Carrying out right to work in the UK checks for European nationals post Brexit.

Employers must continue to carry out right to work checks for all workers before employing them, as was the case prior to Brexit. Employers can continue to use European Economic Area (EEA) and Swiss passports and national identity cards as evidence of an individual’s right to work in the UK until 30 June 2021.

Employers can also use the online checking service to confirm that a candidate has settled or pre-settled status and therefore has the right to work in the UK. However, up to 30 June 2021, candidates do not have to agree to share their status using the online checking service. They can provide their passport or national identity card as an alternative. Governmentguidancesuggests that, up to 30 June 2021, an employer that insists on seeing evidence of settled or pre-settled status risks a complaint of race discrimination.

Following the UK’s departure from the EU on 31 January 2020, a transition period was in place until 31 December 2020. EEA and Swiss nationals who were in the UK before the end of the transition period have until 30 June 2021 to apply for either settled or pre-settled status, which will give them the right to work in the UK.

There is no requirement for employers to carry out retrospective right to work checks for existing EEA and Swiss national employees to confirm that they have settled or pre-settled status. In other words, if an employer has conducted a compliant right to work check for an EEA or Swiss national before 1 January 2021, it does not need to repeat this.

EEA and Swiss nationals entering the UK from 1 January 2021 will not be able to apply for settled or pre-settled status. Because free movement between the UK and the EEA ended on 31 December 2020, they will require a visa to be able to work in the UK under the new immigration system. Therefore, to confirm the right to work of EEA and Swiss nationals arriving in the UK on or after 1 January 2021, employers will need to see evidence of their visa alongside their passport or national identity card.

EEA and Swiss nationals are not required to share their settled or pre-settled status prior to 30 June 2021. This may present an issue for employers with new starters between 1 January and 30 June 2021, as they may not know if the employee was already in the UK before 1 January 2021, and therefore whether they require a visa. Government guidance onright to work checksdoes not address this specific issue.

When does an employer need a sponsor licence?
An employer needs a sponsor licence if it intends to employ a foreign national who requires a UK visa, under certain immigration routes. From 1 January 2021, a new immigration system applies equally to European Economic Area (EEA) nationals (except Irish nationals) and other non-UK nationals. Prior to 1 January 2021, employers needed a sponsor licence to employ foreign nationals from countries outside the EEA under tier 2, or the skilled worker route, and certain other routes of the immigration system. Employers that do not currently have a sponsor licence will need to apply for one if they wish to recruit any non-UK nationals, including those from inside the EEA, under the skilled worker route (and certain other routes) from 1 January 2021.

An employer will not need a sponsor licence to employ an EEA national who has settled or pre-settled status, or to employ an Irish national. When an employer has a sponsor licence it can issue certificates of sponsorship to individual foreign nationals. The individual then uses the certificate to apply for a visa. Employers can sponsor an employee only if the role meets the minimum requirements relating to skills and salary.

What should an employer do if an employee’s application for settled status is not successful?
Employees who are European Economic Area (EEA) or Swiss nationals, who are in the UK prior to the end of the Brexit transition period on 31 December 2020, can apply for settled status, which will give them the right to remain indefinitely in the UK. An applicant who has not been resident in the UK for five years will be granted pre-settled status, which can be converted to settled status after five years’ residence. The deadline for applications for settled or pre-settled status is 30 June 2021.

Settled or pre-settled status can be refused on grounds of eligibility, for example if the individual is not an EEA national (or a qualifying family member) or is not resident in the UK. It can also be refused on grounds of suitability, for example if the individual has been convicted of a particularly serious crime or is deemed to be a threat to public security.

If an application is refused the applicant can apply again at any time up to 30 June 2021, submitting new information or evidence. In some circumstances, the applicant can apply for anadministrative reviewof the decision.

An employer could consider providing an employee with access to legal assistance for a further application or an administrative review. Ultimately, if the employee does not obtain settled or pre-settled status, they will not have the right to work in the UK and will need to apply for immigration permission under an alternative route.

Image Credit:Boris Johnson Brexit Presserby Number 10 used under CC BY-NC-ND 2.0

Can an employee take annual leave while on furlough?
Government guidance onHoliday entitlement and pay during coronavirus (COVID-19)confirms that furloughed employees can take annual leave, without the furlough period being disrupted.

Employers must pay furloughed employees their normal rate of pay for a period of holiday, rather than any reduced amount they receive during the furlough. They must top up the amount they can claim under the Coronavirus Job Retention Scheme.

From 1 July 2020, furloughed employees can work on a flexible, part-time basis for their employer (known as flexible furlough). The employer can claim under the Coronavirus Job Retention Scheme for the hours that the employee does not work and is recorded as being on furlough.

HM Revenue and Customs guidanceon the scheme states that, where an employee is flexibly furloughed, “any hours taken as holiday during the claim period should be counted as furloughed hours rather than working hours”.

It goes on to say that employers should not place an employee on furlough simply because they are on holiday for that period. Therefore, an employer’s decision about whether to furlough an employee should not be influenced by any annual leave, but if an employee takes annual leave during a period covered by a flexible furlough arrangement, the employer should record any hours they were due to work as furlough. It can claim for these hours under the scheme, ensuring that it pays the employee their normal rate of pay for the annual leave.

Many employers that have furloughed employees will not be in a financial position to pay them in full during annual leave. These employers can refuse any requests for annual leave during the furlough period by giving therequired notice. Employees will be able to carry over unused leave in some circumstances.

Where an employer can afford to top up the pay of a furloughed employee, it may consider requiring them to take annual leave during the period of furlough.

Whether or not this can be done in compliance with the Working Time Regulations 1998 (SI 1998/1833) remains uncertain.

When does overtime have to be included in holiday pay?
Holiday pay must be calculated based on the employee’s normal pay. Where an employee normally works overtime, this should be included in the calculation of their holiday pay.

Overtime that the employer is contractually obliged to offer and that employees are required to work must always be included in holiday pay.

InBear Scotland Ltd and others v Fulton and others; Hertel (UK) Ltd v Woods and others; Amec Group Ltd v Law and others [2015] IRLR 15 EAT, the Employment Appeal Tribunal (EAT) held that regular overtime that is not guaranteed, but that employees are required to work when it is offered, must also be included.

There is no definition setting out how regularly overtime must be worked for it to be included, but the general principle is that pay that is “normally received” should be included in holiday pay. If an employee has worked a settled pattern of overtime over a period, payment for that overtime is pay that they normally receive and must therefore be included in holiday pay.

Where there is no settled pattern of overtime, the employer should calculate average pay over a reference period leading up to the period of annual leave, although the courts have not addressed what a suitable reference period would be.

The Court of Appeal addressed the question of whether overtime that is voluntary must be included in the calculation of holiday pay inEast of England Ambulance Service NHS Trust v Flowers and others [2019] IRLR 798 CA. It held that voluntary overtime must be included if it is part of a pattern of work that is sufficiently regular and settled for payments made in respect of it to amount to normal remuneration. This will be for tribunals to decide on the facts of each case.

The right to be paid for non-guaranteed overtime in holiday pay derives from case law of the European Court of Justice, and so applies only to holiday pay for the four weeks’ minimum annual leave under EU law, not to the additional 1.6 weeks provided for by the Working Time Regulations 1998 (SI 1998/1833).

Employers should decide their policy on how to treat the additional 1.6 weeks’ statutory minimum leave and any additional contractual entitlement but may decide to include pay for overtime in all holiday pay to avoid complicating the administration of payments.

Flexible working requests:
When are employers’ decisions discriminatory? While the law on the right to request flexible working has not changed, employers are likely to be seeing a shift in employees’ expectations around flexible working. Some employees who have been working flexibly for a sustained period during the pandemic may wish to make this arrangement permanent. The employee may be able to show that they have continued to perform to the required level, or even exceeded expectations, with these changes in place. Now more than ever, employers need a strong reason for refusing flexible working requests or could find themselves on the losing end of indirect disability, sex, or age discrimination cases.

Image Credit:What does furlough from a job means on a whiteboardby Jernej Furman
used under CC BY 2.0

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