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Lawrence Stephens appointed to Glenhawk’s Panel of Solicitors

Posted on: June 20th, 2024 by Yvonne Uzoka

We are delighted to share that Lawrence Stephens has been appointed as a panel firm by Glenhawk, the award-winning short-term real estate lender.

This strategic partnership comes in the wake of Glenhawk’s announcement earlier this year that it has secured substantial funding to bolster its lending capacity and enter the buy-to-let market. With a continuing drive to remain competitive and market-leading in the bridging finance space, Glenhawk are revamping its range of unregulated and regulated products while introducing new products in order to deliver an ongoing programme of growth.

Lawrence Stephens will play a crucial role in supporting Glenhawk’s growth objectives. With a commitment to excellence and delivering top-tier legal services, there is an alignment with Glenhawk’s ethos of quality and integrity within the industry.

Guy Harrington, CEO of Glenhawk, commented: “Lawrence Stephens’ reputation as a well-established high-quality law firm makes them a welcome addition to our panel solicitors. We’re delighted to be working with Greg and his team.” 

Director and Head of Real Estate Finance, Gregory Palos, added: “Our multi-disciplinary firm has a long track record of being a people business devoted to delivering a high-quality personal service to clients. We’re proud to be supporting Glenhawk in the next step of their lending journey.”

Lawrence Stephens looks forward to this collaboration with Glenhawk that promises to enhance the lending landscape and deliver exceptional service to clients across the board.

Lawrence Stephens celebrates the launch of the FEBE Growth 100 2024

Posted on: June 19th, 2024 by Yvonne Uzoka

There are 4.2m private companies in the UK, but just 1% or 45,000 of these are considered to be ‘high growth’. These are the entrepreneurs that are making a difference and helping drive the economy. FEBE (For Entrepreneurs, By Entrepreneurs) is an organisation that enables a close-knit community of British founders to empower, celebrate and support these.  The annual FEBE Growth 100 list showcases the fastest-growing, founder-led privately owned businesses with an annual turnover of between £3m and £200m and we are delighted to recognise those who have made the 2024 list.  The criteria for inclusion on this list is rightly very strict, so congratulations also go to the 29 companies who haven’t quite met all of these, but are recognised in FEBE’s ‘Watch List’ for their drive and ambition. We look forward to seeing you on a future Growth 100 list!

Many of our clients are privately owned, founder-led businesses and as a law firm led by its founders and sharing the challenges they face, we feel great empathy with these. We are right behind FEBE’s championing of the sector, their philosophy and vision, and Lawrence Stephens is proud to continue to support them as a Corporate Partner.

You can take a look at the latest Growth 100 and FEBE Watch List here: https://www.febe.com/

William Bowyer discusses the importance of protecting athletes’ image rights in Law360

Posted on: June 18th, 2024 by Natasha Cox

Associate William Bowyer discusses athletes’ image rights following an award of €200,000 to the family of former Formula One champion Michael Schumacher, over publication of an AI-generated interview of him in Die Aktuelle magazine, in Law360.

Will’s article was published in Law360, 14 June 2024.

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F1 driver AI case sheds light on winning tactics in IP suits

Athletes should ensure they protect their image, both via the contracts they enter into, such as sponsorship and broadcast deals, as well as by monitoring use of their image online. This will require considerable tenacity given that an uploaded image generated by artificial intelligence can suddenly go viral.

In this context, a decision by a Munich Labor Court to award €200,000 ($216,215) to the family of former Formula One champion, Michael Schumacher, which was reported in May[1] could set a precedent for athletes in image rights cases.

Although the circumstances of this case were highly unusual, given Schumacher’s profile and the nature of the interview in the article, the controversy over presenting quotes generated by AI as a genuine interview with Schumacher indicates that publishers cannot simply take advantage of the latest technology to behave less responsibly.

Indeed, the admission by publisher, Funke Mediengruppe that the April 2023 article in Die Aktuelle magazine was “tasteless and misleading”[2] indicates that athletes remain in a strong position when it comes to protecting their image and reputation.

Instead of encouraging media outlets to be ever more cavalier, this case implies that positive outcomes for sports personalities who take an aggressive and proactive approach remain achieveable.

The Schumacher case has opened the door for a wave of issues surrounding circumstances where third parties misuse image rights or create digital representations of real people without their authority.

In this particular example, the facts of the case indicate brazen misrepresentation on the part of Die Aktuelle. On the front cover of the edition in question, the headline ‘Michael Schumacher, the first interview!’ ran next to a photograph of the celebrity.

The magazine also wrote that “it sounds deceptively real”, with supposed, AI-generated quotes attributed to Schumacher. Only when reading the article on the inside pages did it become clear that the quotes had been produced by an AI tool.

Schumacher, the winner of seven F1 titles, has not been seen in public since being in an induced coma after suffering severe head injuries in a skiing accident in December 2013. The headline, which blatantly misrepresented reality, was obviously a ploy designed to attract maximum attention to potential readers not looking beyond the front cover.

Two days after publication, the magazine’s editor-in-chief Anne Hoffmann, who had held journalistic responsibility for the paper since 2009, was sacked and Bianca Pohlmann, managing director of Funke media group, apologised to Schumacher’s family.

Schumacher’s family was able to use Funke’s admission of responsibility and poor judgment against the publisher to reach a settlement, along with the fact that they wanted to reduce the public attention on this case as much as possible.

The battle between celebrities or brands and imitators is by no means a new phenomenon, and athletes and sports personalities work hard to protect the intellectual property and brand in their image, voice and likeness.

For instance, in February 2024, French football star Kylian Mbappé applied to European Union Intellectual Property Office to register a black and white logo depicting his crossed-arms celebration as a trademark[3] for  clothing, footwear, games, sports equipment, accessories, luggage, and printed matter such as books and magazines.

In doing so, he followed a path pioneered by his former Paris Saint Germain teammate Lionel Messi. Messi, who set the precedent, was engaged in a nine-year legal battle before the European Court of Justice finally approved his registration in September 2020 of an EU-wide trademark for a logo consisting of his name and a stylized letter ‘M’[4].

Seeking to monetise their image and using the law to proactively build their brand, Mbappé’s move is part of a wider trend by sports stars and celebrities to protect IP rights relating to their signatures, names, and other personal characteristics. Trademarking a logo, symbol, name or other similar mark grants these owners a monopoly right over their IP assets and helps to stop third parties from using their image without consent or payment.

While athletes have looked to the law to protect their brand and visual identity from copycats, the boom of generative AI has led to a slew of legal claims surrounding IP. Globally, lawyers are already seeing a rise in AI-related litigation surrounding image rights, and the German court’s decision will no doubt add to the momentum.

Another case, which could set a legal precedent in the UK, is the dispute between Getty Images and Stability AI[5], a London-based AI developer, which was filed in June 2023 and is currently pending trial before the High Court of Justice of England and Wales.

Getty claims that Stability AI is responsible for infringing its IP rights through the development of its Stable Diffusion system, which automatically generates images based on text or image prompts input by users. It argues that the synthetic images generated by AI in this instance reproduce in substantial part its copyrighted works.

Separately, in January 2023, a group of artists filed a claim against Stability AI in the U.S. District Court for the Northern District of California after one of them discovered that over 50 pieces of her artwork had been uploaded to LAION[6], a data set which feeds artificial intelligence image generators including Stable Diffusion.

The EU AI Act[7], which has been at the vanguard of legislation racing to catch up with the technology, proposes that AI tools will have to disclose any copyrighted material used to train their systems. As AI becomes more embedded into the workstreams of both online and print publications, it is likely that many more of these cases will occur.

While you cannot use someone’s image without their consent to sell or promote goods or services under both UK and EU IP law, there are exceptions when reporting the news. In the Schumacher case, however, Die Aktuelle were representing that the interview was both genuine and endorsed by his family in an attempt to sell their magazine.

Many well-known figures have already found their reputations damaged by such AI-generated images, which are so convincing that they are widely shared online – a scenario that athletes and their representatives will need to be ready to counter robustly.

Despite the general uncertainty that the widespread use of AI brings to image rights, the Schumacher case rightly shows a trend towards how athletes are looking to the law to protect their brand, enabling them to place themselves in pole position in image rights cases.

 

[1] https://www.bbc.co.uk/sport/formula1/articles/cd1176240lko.

[2] https://news.sky.com/story/michael-schumachers-family-win-legal-case-over-tasteless-ai-generated-interview-in-german-tabloid-die-aktuelle-13141870.

[3] https://euipo.europa.eu/eSearch/#details/trademarks/018984428

[4] C-449/18 P EUIPO v Messi Cuccittini and C-474/18 P J.M.-E.V. e hijos v Messi Cuccittini

[5] Getty Images v Stability AI [2023] EWHC 3090 (Ch)

[6] Andersen v. Stability AI Ltd., 23-cv-00201-WHO

[7] https://digital-strategy.ec.europa.eu/en/policies/regulatory-framework-ai

 

 

 

 

 

 

Lawrence Stephens is delighted to announce the appointment of Director Matt Green as the firm’s Head of Technology Disputes and Head of Blockchain and Digital Assets

Posted on: June 17th, 2024 by Yvonne Uzoka

With considerable growth in the past four years in particular, Lawrence Stephens bolsters its practice to include a leading litigator with a wealth of experience in the sector, which includes crypto asset recoveries, complex litigation involving blockchain technology and intellectual property.

Matt’s seminal case AA v Persons Unknown confirmed that crypto assets are property at common law, and since then he has led on high-profile cases involving blockchain technology. 

Paired with a background in intellectual property and commercial disputes, the firm is now further equipped to deal with issues arising from emerging technologies including crypto and digital assets.

Steven Bernstein , Managing Director and co-founder of Lawrence Stephens, comments: “We are all very excited for Matt to join the team. His industry-leading expertise in blockchain technology and disputes in this sector adds an exciting dimension to our existing crypto and disputes offerings.”

Matt is recognised in both the Legal 500 and Chambers and Partners as a leader in the field, and is the host of the In Early Podcast, which was featured in the Lawyer’s Briefing room. His also gives annual lectures at the University of Cambridge, has published academic papers on DAOs and NFTs and is a regular speaker at industry conferences and webinars.

Matt notes “I am hugely excited to be joining Lawrence Stephens, a firm that really understands the glaring value of emerging technology for clients across the board, and that innovation without barriers is the determining factor in helping those who need specialist advice”.

News of Matt joining Lawrence Stephens was covered by Law360 and Citywealth, 17 June 2024, LegalMoves, 20 June 2024, and New Law Journal, Financial News, and The Legal Diary, 21 June 2024.

Landlord and tenant works – Construction Industry Scheme payments now made simpler

Posted on: June 13th, 2024 by Natasha Cox

In brief:

Regulations were introduced in April of this year which removed the uncertainty and complexity on which payments made by commercial landlords to tenants are covered by the Construction Industry Scheme (CIS). As a result,  the majority of such payments will now fall outside the scope of the CIS and the requirement for deductions as advance payments towards a sub-contractor’s tax and National insurance to HMRC.

The pre-April 2024 rules created a cumbersome legal and administrative obligation and the removal of these compliance burdens must be welcomed.

Legislation

The Income Tax (Construction Industry Scheme) (Amendment) Regulations 2024 (SI 2024/308)  introduced in April 2024 added a new Regulation 20A to the main CIS regulations which specify that payments made by a landlord to a tenant for construction operations in connection with a lease or agreement for lease are not contract payments and are, therefore, outside the scope of the CIS.

To fall within the scope of this exclusion, payments must meet the following conditions:

  • The payment is made by or on behalf of a landlord;
  • The payment is received by a tenant or prospective tenant (tenants include sub-tenants);
  • The payment is for construction operations agreed in connection with a lease or agreement for lease;
  • The tenant that occupies or will occupy the property will carry out the construction works themselves or contract with a third party to undertake the work; and
  • The payment must be for construction operations relating to works intended primarily for the benefit and use of the tenant that occupies or will occupy the property under the lease.

The definition of ‘landlord’ includes a person with the legal or beneficial ownership of the property, who granted the lease or who will grant the lease.

What does this mean?

Under the pre-April 2024 rules, and prior to entering into any agreement relevant to the construction operations, both the landlord and tenant were required to take legal and taxation advice in order to jointly agree and document that any payments from the landlord to the tenant regarding such construction works either fell within the exclusion for ‘reverse premiums’ in Regulation 20 of the main CIS regulations so that they fell outside the scope of the CIS – or they did not and deductions would need to be made. 

Although contributions made by a landlord towards the tenant’s own fit out works were easier to assess, it was far more difficult where a contribution was being made towards the tenant undertaking Category A fit out works. This led to some landlords being more ‘careful’ in requiring the operation of the CIS on such contributions. Tenants were being asked to take on the added cost of CIS deductions –  as well as the added administrative and cash flow burdens of having to reclaim the amounts deducted. 

The new exclusion under Regulation 20A should lead to most payments by landlords to tenants (or prospective tenants) for construction operations being defined as outside of the scope of the CIS. However,, the implications of Regulation 20A do need to be fully understood.  Most notably,is the requirement that the landlord’s payments must be for construction works intended primarily for the benefit and use of the tenant. This means that any payment which relates to works outside the property occupied by the tenant is likely to fall outside the new exclusion and will therefore remain within the scope of the CIS.

As a reminder…

The new regulations do not affect the application of the CIS to payments by tenants to landlords for construction operations. Take an example where where the landlord has agreed to undertake the tenant’s own fit out works., While these payments will continue to usually fall outside the scope of the CIS, if the tenant will be sub-letting part or the whole of the property or they are registered with HMRC as a so-called ‘contractor’, the CIS deductions would apply in accordance with  Regulation 24 of the main CIS regulations for payments in respect of property used for the purposes of the business of the tenant or another company in the same group.

If you need any advice on the Construction Industry Scheme or any other aspects of construction law, please contact our team of experts Anne Wright and Tom Pemberton.

 

Lawrence Stephens advises Compliance Group on the acquisition of CT Fire Protection

Posted on: June 13th, 2024 by Yvonne Uzoka

The Lawrence Stephens Corporate team has advised Compliance Group, a leading provider of safety and regulatory compliance for electrical, fire and water services, on the acquisition of CT Fire Protection, an owner managed company specialising in fire control systems.

Compliance Group focuses on providing integrated electrical, water and fire compliance services and applies best of breed technology solutions to ensure the full compliance of its customers. The company has built its leading position in this sector through a number of strategic acquisitions. Compliance Group’s long-term mission is to provide the best proposition in the industry by bringing together five-star customer services and technical excellence.

This latest transaction is Compliance Group’s third deal of 2024, underscoring its robust growth and strategic expansion plans via partnerships with high-quality businesses across the fire, water, and electrical compliance areas.

The Lawrence Stephens team was delighted to advise on this and earlier transactions. The team was led by Senior Associate Katherine Zangana, supported by Director Craig Mullen in commercial property and Solicitor Carla Bernstein in corporate.   

Ricardo Gaeda discusses the deregulation of the cannabis market in The Times

Posted on: June 6th, 2024 by Yvonne Uzoka

Ricardo’s article was published in The Times , 6 June 2024, and can be found here.

In the biggest shake-up of federal drug policy for more than 50 years, the US Drug Enforcement Administration recently announced plans to reclassify cannabis as a less dangerous drug. The move came as a belated response to even greater liberalisation that has occurred over many years at a state level: since California became the first state to legalise cannabis for medical purposes in 1996, a further 37 US states have followed its example. After several states decriminalised cannabis in the 1970s, Colorado and Washington became the first two states to legalise the drug’s recreational use in 2012. Today, cannabis is legal for medical use in 40 states, with recreational/adult-use legal in 24 states. 

Although federal reclassification would not automatically result in national legalisation, it could result in lower tax rates for the cannabis industry and less restrictions on scientific research. In anticipation of cannabis’ wider medical usage and reduced regulation, leading to a number of listed cannabis companies’ stocks have reached new highs.

The momentum of potential investor interest will inevitably extend to the UK and Europe as companies seek to expand their cannabis operations. This will however depend upon a comparable shift in legislation and regulation.

In the EU, the legislative pendulum has already begun to swing. Cannabis has been available for recreational use in Amsterdam’s coffee shops for decades, as part of the Dutch policy of toleration.  More recently, as at 1 April 2024, Germany decriminalised personal possession and allowing the cultivation of up to three cannabis plants at home. Notably, most EU countries already permit, or are considering to allow, the medical use of cannabis or some form of cannabinoids.

However, progress on patient access in the UK continues to be painfully slow. Despite the law being changed in November 2018 to allow the prescribing of unlicensed cannabis-based products for medicinal use (CBPMs),  there are only a handful of prescriptions for CBPMs made available through the NHS, mainly used for the treatment of children with epilepsy. The vast majority of CBPM prescriptions are made through private clinics, meaning only those able to afford private medical care can obtain the medicines while their less affluent peers are denied access.

The current government has shown little appetite to confront the issue in parliament while Labour Party leader Sir Keir Starmer has repeatedly made it clear that he has “no intention” of changing the UK drug laws if his party wins the next general election.

It is therefore evident that a long road to legislative reform may lie ahead.

But if the UK is to keep pace with its global counterparts in medical cannabis regulation, it is vital that the next government reforms its approach to medicinal cannabis – not only to help those with chronic health conditions, but also to enable a viable new industry to be established without being hampered by unnecessarily restrictive regulation.

The Leasehold and Freehold Reform Act 2024: What homeowners need to know

Posted on: June 5th, 2024 by Natasha Cox

The Leasehold and Freehold Reform Act 2024 marks a significant shift in the landscape of home ownership in England and Wales. This legislation is designed to empower homeowners, providing them with increased rights, greater transparency, and enhanced protections. As a law firm committed to supporting our clients in navigating complex property issues, we are here to break down the key aspects of this transformative Act. 

Empowering homeowners with greater rights and protections

One of the most notable changes is the simplification of the process for leaseholders to buy their freehold. Historically, this process has been both complex and costly. The new legislation makes it easier for leaseholders to secure ownership of their homes and reduces the expenses involved. Additionally, the standard lease extension terms have been extended to 990 years for both houses and flats, up from the previous 50 years for houses and 90 years for flats. This change ensures that leaseholders can enjoy long-term security without the ongoing stress and financial burden of future extensions.

Facilitating the Right to Manage and collective enfranchisement

Leaseholders will now find it much easier to take over the management of their buildings, with the floor space limit for Right to Manage and collective enfranchisement being increased from 25% to 50% of commercial space. This will allow more leaseholders to exercise control over their properties, by appointing their preferred managing agent or collectively buying the freehold.

Streamlined processes for lease extensions and freehold purchases

New leaseholders were previously required to own their property for two years before they could extend their lease or buy the freehold. The Act abolishes this requirement, giving new homeowners immediate rights to extend leases or purchase freeholds, thereby simplifying and expediting these processes.

Enhanced transparency and fairness in service charges

Transparency over service charges has long been a contentious issue between leaseholders and freeholders. The Act mandates that freeholders and managing agents issue bills in a standardised format, allowing leaseholders to scrutinise and challenge these charges more effectively. This move towards greater transparency is a significant step in addressing unclear and often unjustified service charges.

Increased rights to challenge unreasonable practices

The Act empowers leaseholders to challenge their landlords’ unreasonable charges at the Tribunal without the deterrent of covering their freeholders’ legal costs. This change is expected to encourage more leaseholders to stand up against unfair practices, fostering a more balanced relationship between leaseholders and freeholders.

Rights for freehold homeowners on private and mixed tenure estates

For freehold homeowners on private and mixed tenure estates, the Act extends similar rights of redress that leaseholders enjoy. This includes greater transparency over estate charges and the ability to challenge their reasonableness. The legislation ensures that homeowners are well-informed about the charges they incur and can dispute unfair costs.

Banning new leasehold houses and excessive insurance commissions

In a bid to curtail the practice of selling new houses as leaseholds, the Act bans this practice except in exceptional circumstances. This move guarantees that future homeowners will generally acquire freehold properties, ensuring full ownership rights from the outset. Moreover, the Act addresses the issue of excessive buildings insurance commissions by banning opaque and excessive fees, replacing them with fair handling fees.

Conclusion

The Leasehold and Freehold Reform Act is a landmark piece of legislation that significantly enhances the rights and protections for homeowners in England and Wales. By making it easier and cheaper to extend leases, buy freeholds, and challenge unreasonable charges, the Act aims to create a fairer and more transparent property market. 

However, while the Act has received Royal Assent, numerous pieces of secondary legislation will be needed in order to clarify the exact, day-to-day application of these changes in practice. It is currently unclear when this additional legislation will be passed.

At Lawrence Stephens we are dedicated to helping our clients navigate these changes and leverage their new rights effectively. If you have any questions or need assistance regarding the implications of this Act, please do not hesitate to contact our specialised Residential and Leasehold Enfranchisement team. 

 

Angélique Richardson comments on Ryan Garcia’s doping case in World Boxing News

Posted on: June 3rd, 2024 by Natasha Cox

Following the news that boxer Ryan Garcia’s B sample has tested positive for ostarine, Associate Angélique Richardson comments on how high-profile fighters and their legal teams navigate doping cases.

Angelique’s comments were published in World Boxing News, 3 June 2024, and can be found here.

Angelique’s comments:

“Garcia is on the ropes, facing a lengthy ban from the sport of boxing.

“It’s not hugely surprising that Garcia’s B-Sample has also tested positive – it is extremely rare for an A-Sample and B-Sample to return differing results. As a Sports lawyer, we would always advise our fighters to request that their B-Samples be tested – it is good form and good diligence.

“The lead-up to the Haney v Garcia fight was controversial enough, with Garcia’s victory called into question. Now we have a positive A-Sample and B-Sample from Garcia to add to the mix. Issues like this continue to give the sport of boxing a bad rep.

“Garcia is an entertaining character in the sport of boxing. If he chooses to pursue his innocence, which is unclear from the ping-pong nature of his social media, he’ll come out swinging. I’m sure we’ll all have a ringside seat.”

The potential pitfalls of unlimited annual leave

Posted on: March 20th, 2024 by Natasha Cox

Many employers including LinkedIn, Netflix, Eventbrite and Dropbox are now offering their employees unlimited annual leave.

Unlimited leave reflects a significant uplift on the statutory minimum position. Under the Working Time Regulations 1998, full-time employees are legally entitled to 5.6 weeks’ paid holiday each year, which translates to 28 days, including bank holidays. Part-time staff are also entitled to 5.6 weeks, the number of days being dictated by how pro-rated their working time is.

While undoubtedly a great selling point to potential new recruits, is unlimited annual leave more hassle than its worth for an employer?

Potentially, yes. Employers need to be extremely careful when implementing an unlimited annual leave policy because failing to set appropriate expectations and creating a clear and well-structured policy could lead to significant problems. For example, how does one calculate the annual leave owing (or owed) when an employee’s employment comes to an end if this is not specified in their contract or the leave policy? Likewise with the continued accumulation of leave during a period of family leave.

No employer is likely to be content with an employee taking 52 weeks’ annual leave in a leave year, not least because they won’t be able to do the job that they’re employed to do. If you are offering unlimited annual leave, employers must ensure adoption of and adherence to minimum performance criteria, as well as having robust performance measures in place to objectively assess how well the employee is performing.

Further, employees will still need their manager’s permission to take time off, which could result in the policy being enforced differently from one manager to another. This may lead to accusations of favouritism, or differing treatment of employees in relation to any of the nine protected characteristics under the Equality Act 2010.

Lack of cover during an employee’s holiday may also discourage them from taking time off, undermining the incentive for annual leave altogether.

It is ultimately important to strike a balance between the needs of the business for employees to carry out the jobs they are employed to do, and the ability to attract and retain the right talent. While offering unlimited annual leave is certainly likely to assist with recruitment and retention, its implementation needs careful handling to avoid unintended consequences.

Talk to us if you would like to discuss the pros and cons of enhanced employee benefits.

Round up of 2023 employment law

Posted on: December 18th, 2023 by Natasha Cox

As 2023 draws to an end, the employment team at Lawrence Stephens examines employment law developments of 2023 and what we’re expecting in 2024.

Holiday and holiday pay

Changes have also been made to the Working Time Regulations 1998.

All employees are entitled to 5.6 weeks’ annual leave entitlement per leave year. The 5.6 weeks is split into two ‘pots’: one pot of ordinary leave, which is four weeks, and one pot of 1.6 weeks additional leave.

Ordinary annual leave should be paid at the employee’s ‘normal’ rate of pay. This does not necessarily apply to the additional leave.

The government is amending regulations to set out what elements of pay are to be included as ‘normal’ for the purposes of the first four weeks’ leave entitlement. Unfortunately, the regulations do not list specific payments that should be included, and instead refer to certain categories, including:

  • payments, including commission payments, which are ‘intrinsically linked’ to the performance of tasks that a worker is contractually obliged to carry out;
  • payments for professional or personal status relating to length of service, seniority or professional qualification; and
  • other payments, such as overtime payments, which have been regularly paid to a worker in the 52 weeks preceding the calculation.

As per previous case law, results-based commission, certain overtime payments, allowances, etc., will still be caught, however there is still uncertainty about payments such as annual or semi-annual bonuses, and it remains to be seen whether this amendment changes much.

For irregular hours workers and part-year workers (both now defined in the regulations), the government is also introducing a new method to calculate their holiday entitlement. Essentially, an irregular hour worker or a part-year worker accrues annual leave at the rate of 12.07% of the number of hours worked, subject to a maximum of 28 days per leave year. A worker will be an ‘irregular hours worker’ if the number of paid hours that they work is ‘wholly or mostly variable’. A worker will be a ‘part-year worker’ if they are required to work only part of that year and there are periods of at least a week in which they are not required to work (and for which they are not paid). This change is intended to address the issues caused by the Supreme Court’s decision in Harpur Trust v. Brazel, in which it held that part-year workers were entitled to 5.6 weeks’ leave per year, irrespective of the hours they worked. 

The government is also introducing ‘rolled up holiday pay’ for irregular hours workers and part-year workers. Rolled up holiday pay is a system under which a worker’s holiday pay is included in their basic pay, rather than paying them when their holiday is actually taken. The practice has been unlawful since 2006 but will now be lawful under the updated regulations.

These changes come into force on 1 January 2024 for holiday years commencing on or after 1 April 2024.

TUPE

The government has announced its intention to change the transfer of undertaking consultation obligations so that there can be direct consultation with affected staff for businesses with fewer than 50 employees, or businesses of any size with fewer than 10 transferring employees. This assumes in both cases that no existing employee representatives are already in place. The regulations are expected to come into force on 1 January 2024 and the changes will apply to transfers that take place on or after 1 July 2024.

National Insurance and Minimum Wage

Class 1 employee NICs will be cut from 12% to 10% from 6 January 2024.

The NICs holiday for veterans in their first year of civilian employment will be extended to 5 April 2025.

For the self-employed, Class 2 NICs will be abolished, and the main rate of Class 4 self-employed NICs reduced from 9% to 8%, from 6 April 2024.

New national minimum wage rates to apply from 1 April 2024 have also been announced, along with a change to the threshold for being eligible for the highest rate. Over 21s will now be entitled to £11.44 per hour, with 18- to 20-year-olds being entitled to £8.60 per hour. 16- to 17-year-olds and apprentices will be entitled to £6.40 per hour.

Fire and rehire

The government has issued a draft Code of Practice on dismissal and re-engagement. It is designed to cover situations such those seen recently with P&O, where an employer makes changes to terms and conditions by dismissing employees under their old contracts and offers to re-engage them on new contracts (with less favourable terms and conditions).

The aim of the code is to clarify how employers should behave when seeking to change employees’ terms and conditions of employment. A court or tribunal will be able to take the code into account when considering relevant cases and they will have the power to increase an employee’s compensation by up to 25% if an employer unreasonably fails to comply with the code. They could also decrease any award by up to 25% where an employee has unreasonably failed to comply.

The consultation on the Code closed on 18 April 2023 and it is anticipated that the government’s response will be delivered in Spring 2024. While the code is still in draft form it is not binding, but any proposed fire and rehire processes should be carefully considered in the meantime.

Flexible working

The Flexible Working (Amendment) Regulations 2023 come into force on 6 April 2024. The regulations amend the existing Flexible Working Regulations 2014 so that the right to make a flexible working application becomes a ‘day one right’ on 6 April 2024. Currently employees must have 26 weeks’ continuous service to make a flexible working request under the legislation (however, nothing prevents employers and employees agreeing flexible working arrangements between themselves, whether formally through contractual variations, or informally). 

It is assumed that the other flexible working reforms contained in the Employment Relations (Flexible Working) Act 2023 will also commence on that date, but this has not yet been confirmed. These reforms will:

  • allow employees to make two flexible working applications every 12 months instead of one;
  • remove the requirement for employees to have to explain what effect they think their flexible working request will have on the employer;
  • require employers to consult with the employee before refusing their flexible working application; and
  • require employers to respond to flexible working requests within two months instead of three months.

Carer’s leave

The draft Carers’ Leave Act 2023 (Commencement) Regulations 2023 have been published, bringing the Carers’ Leave Act 2023 into force from 6 April 2024.

The draft regulations set out important detail relating to the Act. They state that the legislation will cover employees in England, Wales and Scotland. To be entitled to the provision, employees need to be providing long term care. Carer’s leave will be able to be taken in half or full days, up to and including taking a block of a whole week of leave at once. In a similar way to other types of leave, the notice an employee needs to give to take the leave is twice the length of time that needs to be taken. Leave requests do not need to be made in writing.

Employees taking carer’s leave will have the same employment protections associated with other forms of family related leave. This includes protection from dismissal or detriment as a result of having taken the leave.

The draft regulations still need to be passed by Parliament and it is also expected that guidance will be made available before 6 April.

Strike action

The Strikes (Minimum Service Levels) Act 2023 was passed in July. The act gives powers to make regulations to set minimum service levels in certain industries during strike action. The government has now made regulations under these powers to set minimum service levels for ambulance, railway and border security staff. Although the regulations are not yet in force, they are expected to be by the end of the year. A draft code of practice has also been laid before Parliament, but no minimum service levels are yet in force.

Asim Arshad and Ricardo Geada discuss crypto’s legitimate use in The Times

Posted on: November 23rd, 2023 by Maverick Freedlander

Senior Associate Asim Arshad and Director Ricardo Geada discuss the importance of crypto and its legitimate use cases, while contextualising the technology’s misuse, in The Times.

Asim and Ricardo’s article was published in The Times, 23 November 2023, and can be found here.

It is critical for regulators, officials and the public at large to differentiate between the technology of cryptoassets and its potential misuse. A broad-brush approach due to the actions of a few is misleading, short-sighted, and indicates a limited understanding of the technology, thus hampering its development as a powerful force for progress and financial inclusion.

Collaboration should be key in any strategy to combat crypto’s misuse, and UK authorities should more actively engage with other regulatory bodies overseas in order to share insights and intelligence to address crypto-related crimes, while fostering the growth of legitimate crypto businesses. The misuse of cryptoassets should not overshadow its broader, legitimate applications.

Contrary to common misconception, it is crucial to understand that most blockchains are inherently pseudonymous, rather than anonymous. Every transaction on public blockchain is recorded on a transparent ledger, making the transaction history traceable. This traceability can serve as a powerful tool for law enforcement. This perpetual audit trail enables authorities to trace illicit activities back to their source.

The UK’s ambition to position itself as a global hub for crypto innovation is commendable, and is one of the main reasons that growth of crypto in the UK has far outpaced the likes of the US, Germany and Japan in recent years. However, striking a balance between robust regulation and fostering innovation is crucial. Overly stringent regulations, arguably like we are seeing with the new cryptoasset financial promotions regime, might stifle the growth of the sector, pushing innovators and investors towards more accommodating jurisdictions instead.

The emergence of crypto-related crimes underscores the need for a comprehensive educational push. Regulatory bodies, in conjunction with the industry itself, need to work towards educating law enforcement agencies, financial institutions, and the general public in what is a nascent and constantly developing technology.

It is also crucial to recognise that the relevance and utility of cryptoassets differ across global contexts. For someone in a developed, politically stable country, the urgency or use case of crypto may not be plainly obvious. However, for individuals in countries with economic instability, hyperinflation, or restrictive financial systems, crypto offers a lifeline and can serve as an alternative financial system, providing financial inclusion and allowing people to preserve their wealth against devaluing local currencies. Dismissing crypto merely based on their irrelevance to certain regions or occasional misuse overlooks their broader potential and global impact.

Understanding and leveraging the technology of cryptoassets and their underlying blockchains require a nuanced approach that recognises their potential use cases as well as the need for adequate regulation to mitigate misuse.