Under the new ‘day one rights’ is the right to receive occupational sick pay from day one of sickness, which is a step change from the previous three day wait period before entitlement begins. Whilst this is welcome news for employees, for employers this may require investment in better systems for tracking absence and processes to feed the data instruction into the payroll software. This is one example of the impact of these changes that can be very complex to achieve in real time.

Whilst the employment law changes will drive the legal contractual and policy changes required, this all flows into the employment tax implications and again, in turn, this impacts how payroll processing must be managed.

The Government has promised time to prepare, but that time starts now. To stay ahead, employers should:

• Review and update policies, contracts, systems and processes, identifying gaps and prepare their own roadmap for change;
• Engage with consultations as they arise to ensure impacts on their business are outlined to help shape the future phases of changes;
• Plan for compliance and cultural shifts, especially in areas under the Fair Work Agency’s remit and relating to unions/collective employee engagement, ensuring processes are compliant, robust and cost effective;
• Advance key changes (e.g. restructures, system updates, contract revisions); and
• Act early to reduce risk and gain competitive advantage.

This is a cross-functional challenge: legal, finance, HR, tax, payroll,...

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