Employment Law +

Procurement and employment in the news

Two stories this week for employers involved in outsourced projects, including public sector procurement. We knew from Labour’s plan to make work pay that a new National Procurement Plan will make social value mandatory in public sector contract design. The detail has now been shared in new procurement guidance which sets out social value requirements. The guidance is effective from 24 February 2025 (and mandatory from 1 October 2025), and it includes a number of really significant employment/ workforce angles in the social value menu, including bringing in aspects of policy which form part of the Employment Rights Bill and other govt. initiatives. This means that elements of the ERB such as flexible working, trade union rights and sick pay from day one may well be on suppliers’ agenda prior to implementing regulations being in place for ‘other’ employers. More detail will follow on Outlaw, but the guidance is a must read for employers tendering for public sector contracts.

Of wider relevance to public and private outsourcing projects, the question of whether a discrimination claim based on unequal pay can be brought by a supplied worker directly against a customer organisation continues in litigation. In two separate and unrelated cases, cleaners supplied by contractors have argued that they should be paid the same higher rates as directly employed customer staff. A Court of Appeal decision in Boohene v The Royal Parks Ltd last year decided that any sex based discrimination claim around unequal pay should be brought against the supplier who directly employed the cleaner. However, leave to appeal the Boohene decision to the Supreme Court has been sought. Meanwhile, another supplied cleaner, Ms Djalo, has appealed to the Employment Appeal Tribunal after her unsuccessful race discrimination claim against the customer who paid its directly employed staff higher rates. These are decisions worth monitoring for those involved in providing outsourced services. 

CIPD publishes report on labour market outlook

The CIPD published its quarterly Labour Market Outlook which attracted media attention this month because of its forecasts around employer confidence. The CIPD describes its labour market report as an authoritative employment indicator, providing forward-looking labour market data and analysis on employers’ recruitment, redundancy and pay intentions. The report points to falling net employment and slowing hiring activity. It attributes this to April’s employer national insurance contribution increases, employer plans to scale back recruitment and reduce investment in business growth and training. One in four employers are also said to be planning redundancies in the next three months, the highest level in a decade outside the pandemic. However, the CIPD cautions against “knee-jerk reactions” and promotes taking “a proactive, long-term approach to workforce planning – assessing both your current and future skills needs”. Where redundancies are unavoidable, the CIPD urges a fair process. It also asks the govt. to “be clear on how they’ll support businesses in managing” additional employer costs. The report is an interesting analysis of employer trends in the current economic climate.

HMRC publish initial neonatal leave and pay guidance

HMRC’s February employer bulletin contains a brief summary of neonatal leave and pay entitlements. Fuller HMRC guidance will be available soon, but the initial HMRC summary of neonatal entitlements may be a helpful starting point for employers preparing new policies ahead of the 6 April implementation date.

UKVI publish updated right to work guidance 

Right to Work guidance was updated on 12 February. This new version provides clearer instructions regarding Right to Work checks for non-direct employees, such as the genuinely self-employed or contractors. Previously, the guidance implied that employers licensed to sponsor migrant workers should verify the status of all workers on site, regardless of their employment relationship. The updated guidance clarifies that this requirement applies only to directly sponsored migrant workers. For example, a self-employed contractor sponsored by a UK business must undergo a Right to Work check with that business. This update is particularly beneficial for large-scale employers who frequently host contractors, sub-contractors, or self-employed individuals on site without direct employment or sponsorship relationships. While it is still recommended that employers ensure all workers on site have the Right to Work (e.g. by including a Right to Work clause in commercial labour agreements), the UK host business is not required to conduct all these checks directly.

Annual allocations for certificates of sponsorship

Many licensed sponsors will see their annual allocations of Certificates of Sponsorship expire in the coming weeks and although UKVI has upgraded many sponsors to automatic renewal, there are some points for sponsors to note:

• Diminished Allocations: If your allocation is due to renew soon, available allocations may currently be reduced. If you will need sponsorship in the coming weeks, you may need to request interim allocation increases and plan accordingly.
• Sponsorship Management System: Level 1 users should access their Sponsorship Management System to check when the allocation will renew and whether the automatic renewal service has been activated.
• Renewal Levels: Allocations are generally renewed at the same usage level as the previous 12 months. If you anticipate needing more than last year, make suitable plans to increase the allocation as needed.
Our Global Immigration team is available to assist with all issues related to licensing and sponsorship and will be happy to help where needed.

This page is updated weekly with News and Views from that week’s employment weekly briefing email. For previous articles, please contact us: Employment Law Plus.

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