The government’s Good Work Plan runs to 68 pages, takes forward 51 policy recommendations and for any industry with a large workforce will mean significant change which creates costs and risk.

At the heart of the Plan is an ambition to put quality work on a par with quantity of work. Well intentioned policy recommendations, designed to rebalance the employer-employee relationship, are difficult to disagree with in principle. But in practice, some of these recommendations will have broad consequences for those employers already striving to deliver quality work that suits colleagues’ needs.

Extending workplace rights is not the traditional space for a Conservative government to act. But given the PM set out her stall to tackle the burning injustices across the economy in 2017, it is perhaps no surprise that the package of measures stacks up to be a relatively comprehensive set of new rules and responsibilities for employers.

Although some of the measures have a long lead, the new regulations do not take force until April 2020, the issues are complex and have the potential to be costly. Earlier this month we brought employment and tax specialists from PwC together with 20 leading retailers to unpick the detail of the Good Work Plan looking at what it will mean for the industry, and how they can get their businesses ready. PwC’s John Harding and Anna Vishnyakov highlighted a number of key changes that retailers will have to get to grips with.

So, what’s changing and what should retailers start thinking about now?


National Minimum Wage - PwC highlighted the recent change in enforcement around NMW and the likely scope for changes under the current consultation. They noted the Government’s preference for extending the approach to NMW enforcement by HMRC (targeting businesses, 200% penalties etc) to Holiday Pay.

Agency workers – From April 2020 employers will no longer be able to engage agency workers on Swedish Derogation contracts. In retail these contracts are typically used in the distribution function and contractual changes will come at a cost. The key question from retailers is how to ensure compliance going forward, particularly where contracts are already in place that go beyond 2020.

Holiday pay – The reference period will change to a 52-week rolling period and the government have confirmed their intention to state enforce holiday pay on similar terms as the National Minimum Wage is enforced. For retailers, there are some immediate practical steps to take including liaising with payroll providers to prepare for the change in the reference period, determining which pay elements count, whether to apply these new rules just for the EU qualifying holidays or all holidays etc.     Businesses should start to plan now in order to ensure that they are compliant ASAP and do not leave themselves open to claims for underpaid Holiday Pay which can extend back 2 years and potentially 6 years under any new enforcement regime. While many payroll providers may not currently be able to help in complying with Holiday Pay, PwC explained how they had built tools to help employers ensure compliance .

Hours on payslips- As of April 2019, the existing statutory right for employees to receive an itemised payslip will be extended to all workers, note not just employees. This change applies to workers whose pay varies in relation to the hours they work and not all workers. For the relevant population, it will be necessary to record the number of hours relating to the variable pay (note not necessarily all hours worked),show the hours as either a total figure or split out into separate figures for differing types of work or differing rates of pay. The devil will be in the detail and any employers who have not already should be discussing this change with their payroll providers to understand their system’s capabilities and whether changes need to be made to ensure they can meet the new requirements in relation to hours recording.

Day 1 rights - The right to a written statement will become a day 1 right for all employees and workers. Retailers will need to build this in to new offers and employment contracts to ensure compliance. The sequencing of activities before and upto day 1 will take on a new significance.

IR35 – Although this was not part of the Government’s Good Work Plan, this significant change is coming in from April 2020 and retailers should take the time now to better understand what this will mean for their business operations and costs as well as the risks of failing to comply. As a first step retailers should begin to identify those contractors who are engaged via IR35 companies and consider how they want to engage with that individual going forward and whether they will need to put these personal service companies on to their existing payroll. Again PwC talked about the range of tools that are available to help employers understand who might need to be considered and then how to determine if the new IR35 rules apply to them.  

For more information on the above please contact the BRC or either of the presenters from PwC



John Harding //

Anna Vishnyakov //