Human Resources (HR) professionals in the UK are guided by legislation and regulations. To be successful in an HR job, you must remain aware of any updated legislature relevant to employment and have a clear understanding of them to ensure your employer and colleagues remain compliant.
Purpose of an HR department and HR compliance
HR refers to the person or team who typically deal with a company’s recruitment, payroll, training, contracts, benefits, termination, and staff well-being. They also often act as a go-between for managers and employees, and provide clarification on company employment policies, such as holiday and sick pay or parental leave.
There are key employment policies that businesses must be compliant with according to British law. These include Equal Opportunities, Health and Safety, Equality and Diversity policies and the Discipline, Dismissal and Grievance procedures.
Within an HR Department you will typically find the following roles:
- HR Administrator / HR Assistant
- Onboarding Coordinator
- People Business Partner
- Communications (Comms) Specialist / Change Lead
- Training Coordinator / Learning Development Coordinator
- HR Manager
- Head of HR
- HR Director
- Chief People Officer (CPO)
HR compliance knowledge is essential for all HR personnel, and the practical application of this knowledge is an integral part of all HR jobs.
HR compliance is the working standards set out in UK employment law. All UK companies must observe this legislation and include it in their policies and procedure documents, as well as any staff manuals and employment contracts.
UK employment law is regularly updated, and these changes need to be reflected in the way a company treats their staff and issues employee statutory entitlements, such as health and safety regulations or minimum wage rates. It is the responsibility of the HR department to ensure the company remains compliant.
Managing employee contract requirements
HR personnel are responsible for updating and issuing employee contracts. There are various types of contracts needed, depending on whether it is for a full-time or part-time employee, if the person is on a fixed term contract or is agency staff, a contractor, freelancer, consultant, or on a zero-hours contract.
Permanent contracts apply to employees who are working permanently for a company, are paid through their employers’ pay role, and who are eligible to full employee benefits, such as a company pension, annual holiday, and sick leave, and, for tax and National Insurance purposes, they are categorised as Pay as You Earn (PAYE).
Temporary contracts are given to staff who work on a flexible basis, for example to cover a permanent employees’ workload whilst they are on parental leave. The contract of services is usually issued though a recruitment agency, and should include the agreed hourly rate of pay, the hours of work and the length of the contract. For tax purposes, temporary staff are classified as PAYE and for compliance purposes they are entitled to holiday pay. If the contract runs for more than 12 weeks with the same employer, the temporary worker will qualify for equal treatment, which will give them comparable terms and conditions as a permanent member of staff.
Contract staff must have their legal working status listed in their employment contract, for example this could be as a Limited Company or Self-Employed. Often an umbrella company acts as the employer and is responsible for paying the invoiced amount, however the employee is responsible for calculating and paying their Tax and National Insurance, and there is no statutory company annual leave, paternity or sickness pay.
The Right to Work check is a Home Office process carried out before employment can commence and is necessary to establish if an employee or agency worker has the right to work in the UK. This check is part of a company’s compliance requirement. However, during the COVID-19 pandemic, these checks became digital. This amended remote process will remain in place until 30 September 2022.
The regular introduction of new or altered legislations is one of the many reasons that it is imperative for all HR staff to be trained on all updated employment compliancy and regulations.
Diversity and Inclusion
Compliance with the UK government’s Equality Act 2010 guidance is an important part of an HR role. These laws have been created to prevent the discrimination of employees, regardless of their employment status, and is imperative to consider when creating a productive, safe, and inclusive work environment. If these regulations are not observed, a company may face a lawsuit from an employee if they feel discriminated against.
Other than needing to comply with the Equality Act by law, there are other important reasons for HR professionals to consider diversity and inclusion when creating an Equality and Diversity policy and when undertaking staff recruitment.
Research1 shows that a high-level of staff diversity can give a company an increased revenue growth, greater ability to innovate, higher retention rates, and the ability to gain a unique perspective. By ensuring the views and values of all employees are integrated into the company culture and work environment, this can establish a deeper trust and more commitment from employees.
COVID-19 legislation updates
One of the largest recent impacts on HR professionals was the emergence of the global COVID-19 pandemic. There is specific government guidance that must be observed when an employee cannot work due to coronavirus. These rules apply to the payment of benefits if there is a reduction in working hours due to COVID-19, or Statutory Sick Pay (SSP) if an employee has COVID-19 symptoms or is self-isolating.
HR departments also need to be aware of the government’s plans to remove remaining COVID-19 regulations and how that affects their employees.
The government have also issued a relaxation of Working Time Regulations 1998 (WTR), as the pandemic resulted in employees being unable to take annual leave and they are therefore allowed to carry over any untaken annual leave into the next two years.
Staying informed on employee welfare and safety is an important part of an HR department’s role within a company. Go here to stay up to date with the changing regulations brought about by the impact of the COVID-19 pandemic.
To be successful in an HR role, you will need to remain aware of all key legal changes and guidance within HR. This knowledge will allow you to give sound professional advice to company managers and the best level of support to employees.
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- Delivering through diversity, McKinsey &Co, [internet] by Vivian Hunt, Lareina Yee and Sundiatu Dixon-Fyle, published January 2018, accessed November 2021. https://www.mckinsey.com/business-functions/people-and-organizational-performance/our-insights/delivering-through-diversity