Just when you thought we had run out of EU-related puns, here we are again! Yesterday was a busy old day for employment lawyers as government announcements came thick and fast!

Announcement one - EU sunset clause has been...sunsetted! 

The sunset clause in the controversial Retained EU Law (Revocation and Reform) Bill, which loomed more like a dark cloud than a dreamy sunset, has been abandoned (see our earlier article on the Bill here).

Instead of a large bonfire of all EU retained laws, the Government has announced (rather more sensibly) that it is committing to a targeted list of laws which it intends to repeal by 31 December 2023. All other EU retained laws will remain in place unless it is on this list.

What's the impact?

This certainly brings some much-needed clarity that we have lacked since the announcement of the Bill in September 2022. We now need to wait to see which legislation will be on that promised list of 600. Watch this space.

Announcement two - Post Brexit changes to Working Time Regulations (WTR) and TUPE

The Government also announced its policy paper: smarter regulation to grow the economy. Some of the cynical amongst us may see it as an olive branch to hardened Brexiteers who are saddened by the departure of the sunset clause.

Under section 4 (reforming regulations to reduce burdens), the Government sets out some ways it will reduce this regulatory burden through the amendment of employment legislation:

• WTR 
  • merge 'normal' holiday leave with 'additional' holiday leave* although the Government is at pains to stress that this will not affect statutory holiday entitlement (5.6 weeks paid holiday). Whilst the paper does not state this, we wonder whether this change might also pick up other changes once the Government has published its consultation on Holiday Entitlement for part-year and irregular workers (see our previous blog here).
  • allow rolled-up holiday pay so that workers can receive their holiday pay with every payslip. This practice is currently unlawful although often used in practice with zero hours and irregular hours contracts.  
  • remove record-keeping requirements of all working hours under the WTR which the Government see as unnecessary and cumbersome.

• TUPE
  • permit direct consultation with affected employees and not employee representatives for businesses with fewer than 50 people and transfers affecting less than ten employees. The net result will be, the Government hopes, less red tape and improved engagement with affected employees. We knew that TUPE would be in the firing line for changes but it seems to have come off relatively unscathed this time. 

What's the impact?

First, we have no timeframe for these changes although no primary legislation will be needed so the Government could drive them through relatively quickly. That said, it would make sense for the Government to await the results of the holiday consultation and introduce these WTR changes and those flowing from the consultation in one sitting. Let's see if sense prevails. 

Announcement three - Restriction of non-compete clauses 

Whilst this is not related to EU-retained legislation, it is included in the same policy paper and so is worth a mention. Non-compete clauses restrict an individual's ability to work for, or establish, a competing business. The Government recognises their key role in protecting business interests but seeks to restrict the time period of these clauses to three months. This will, the Government promise, give a boost to the wider UK economy and free up business to compete and innovate. This will not, however, affect non-solicitation clauses or the rights of employers to use notice periods or garden leave clauses.  

What's the impact?

This change will require primary legislation and so will take longer, although again we don't know how much longer. At this early stage, we would not advise any dramatic contractual changes. It may, however, be wise to consider whether contracts which rely on non-compete clauses in excess of three months have robust notice and/or garden leave provisions so as to counter any future reduction in the duration of a non-compete clause.  

If you would like any further information please contact a member of the employment and pensions team.

*The EU Working Time Directive provides that each member state must ensure that every worker is entitled to four weeks' paid leave - this is 'normal' holiday. The WTR provides for an additional 1.6 weeks' leave known as 'additional' holiday.

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