EU Employment Law Changes in 2023
From the highly impactful Revocation and Reform law to family leave policy changes, both the European Union and Europe are facing many employment law changes throughout 2023. Discover exactly what changes are expected and how this will impact US companies operating, or planning to operate, overseas.
EU vs Europe: Understanding the Difference
Before discussing the significant changes to EU employment law in 2023, it is vital to understand the difference between the European Union and Europe. Europe is a continent consisting of 51 countries, whereas the European Union, or EU, refers to the political and economic union of 27 countries located in Europe.
And while this may already be apparent to many, differentiating between the EU and Europe is essential here to appreciate the impact these employment law changes may have on businesses operating in the EU and/or Europe in 2023. From changes to leave policies and creating infrastructure to support the ‘right to disconnect’, employers need to be ready for the changes ahead.
Many European countries will be impacted by EU laws even if they are not part of the union, and many independent European countries may be leading trends for the EU to follow. The European Union has been an influential force since its inception in 1993. Often setting the precedent for many laws and regulations, other European countries have followed the EU’s lead, creating like-for-like laws for their citizens.
2023 EU Employment Law Changes
Retained EU (Revocation and Reform) Law
One of the most significant changes facing the EU in 2023 is the Revocation and Reform law. The retained EU Law (Revocation and Reform) bill put forward by the UK government aims to “allow for the [UK Government to amend retained EU law (REUL) and remove the special features it has in the UK legal system.”
However, it is unclear whether this will be pushed back once again due to legal crossover affecting Northern Ireland and the Republic of Ireland.
While, as stated above, the UK is no longer part of the EU, its previous status as a member is still impacting employment law in the UK which may continue for some time to come. This change will impact many elements of UK employment law, from maximum working hours to parental leave regulations. So, if you’re operating, or looking to operate in the UK, this is one to be aware of in 2023.
Ensuring full compliance with these changing employment laws is a must. Updating all regulations should be a high priority for businesses operating in the UK, making sure to include any changes to working hours, parental leave, the Carer’s Leave Bill once passed and more.
Right to Disconnect for Belgium
Switching to a four-day work week in 2022, Belgium has been a leading player in employment law changes in Europe. And alterations to Belgium’s employment law aren’t slowing down in 2023.
Since the 1st of January 2023, employees in Belgium are no longer required to provide a medical certificate on the first day of illness in the instance they are too ill to work. Instead, they are entitled to the right to disconnect, which offers greater balance for workers.
The right to disconnect, or the right to respect employee holidays and time away from work, was introduced to improve a greater work/life balance for those in Belgium. An issue impacting many across the working world, creating healthy work boundaries has become increasingly difficult in our interconnected world. France gained the right to disconnect in 2016, and in a post-pandemic working world, these changes are only likely to amplify.
Employers need to be sure that their working policies cater to these changes, or are preparing, as more countries are likely to follow suit. Working cultures should enable employees to establish healthy boundaries to support an improved work/life balance,which can be enabled through updated working policies.
EU Directive on Work / Life Balance
As of August 2022, EU members turned the directive on Transparent and Predictable Working Conditions into law, this is legislation that looks to improve many aspects of working conditions for EU workers. Although this change took place at the end of 2022, we’re likely to see its impact in 2023.
This directive looks to improve many elements including:
- Parental Leave – EU member states must ensure that fathers are entitled to at least 10 working days of paternity leave paid at the same rate as statutory sick pay and must provide at least two months of the four-month parental leave entitlement as non-transferable.
- Carer’s Leave – Carers must be entitled to up to five working days of leave to assist a dependent with non-urgent care requirements.
- Flexible Working – Flexible working must be available to working parents and carers.
- Probationary Periods – There must be a limit to the length of probation at the beginning of a job for increased security.
Worker’s rights laid out in this law must be implemented, so businesses operating within the EU, whether that is in country or overseas, must ensure full compliance.
Denmark Introduces Extended Employment Termination Notice for Over 55s
As of the 1st of January 2023, Denmark introduced new legislation to extend the notice period of redundancy or employment termination for employees aged 55 years and over.
Employees aged 55 years and over will receive an extended notice period for redundancy and employment termination in comparison to their younger counterparts. This is only applicable to those who have been employed with the same company for five years or more. This policy change is indicative of improved regulation around employee rights when it comes to redundancy, whether this is protection from fire and re-hire processes or similar. It also affords older workers more security and time to find alternative employment.
UK Family Leave Changes
Currently, under Regulation 10 of the Maternity and Parental Leave Regulations 1999, an employer must offer those on maternity, paternity or other parental leave alternative employment when going through the redundancy process. This is prioritised over others that have also been made redundant in the business.
However, changes to the bill aim to extend this protection. For a period of 18 months, an employee should be secured from the moment they inform the employer of a pregnancy or adoption date. Currently, this bill only protects employees during the maternity period.
Impact on US Businesses
But what do these changes mean for businesses operating overseas?
US businesses operating overseas will need to prepare for these changes. From reviewing company legislation and regulation to informing Human Resources of any changes that may impact the business, US businesses must prepare for this throughout 2023.
Ensuring full compliance in both HR and payroll functions when expanding globally is key. Complying with local legislation and respecting local customs and working culture is a necessity for successful expansion in 2023.
Post-COVID-19, the working world is continually adapting to suit the evolving needs of its workers, and employment laws are beginning to change to keep up with this. While meeting country-specific laws should always be considered when carrying out international expansion, these should also be continually adapted to meet with ever-changing employment law landscapes.
Although these EU employment law changes may only appear to impact those working in the EU or Europe at first, many will have a direct effect on businesses operating, or looking to operate, in both the EU and Europe. Businesses looking to expand to the EU need to consider how these law changes may impact their workings, and where they need to update policies to stay compliant.
Discover How IRIS FMP Can Help
Discover how we can help you stay fully compliant as the employment law landscape changes in 2023. IRIS FMP Global are experts in implementing payroll and HR overseas, offering services in over 135 countries worldwide including 28 European countries.