Employment law updates: annual leave, right to work, AI in decision-making and taxing digital nomads

Jill Evans, Law Content Analyst, CIPD, looks at employment law developments in August and September 2022 for England, Scotland, Wales and Northern Ireland. 

Additional UK bank holiday 

An additional UK bank holiday was announced to coincide with Her Majesty Queen Elizabeth II’s state funeral. There is no statutory right to time off on bank holidays but the UK Government hoped businesses would ‘respond sensitively’ to requests for leave on that day. Whether the leave could be taken at that time or be paid will depend on what’s agreed between employers and employees and on contract terms.  

Right to work 

Employers should check all their employees have the right to work in the UK. Employing someone illegally, having carried out the checks incorrectly, could lead to a fine of up to £20,000 for each illegal worker. From 1 October, new rules apply for checks on British or Irish workers with valid passports. Employers must either: 

  • go back to carrying out a manual document check by meeting the employee face to face, or 
  • use identification document validation technology (IDVT). 

Employers can use a Home Office-approved identification service provider (IDSP) to check passports using IDVT on their behalf, although organisations remain liable for the outcome. Businesses can also use a certified IDSP to carry out criminal record checks. 


A new immigration route opened for scientists, engineers and other highly skilled workers on 22 August, aimed at fast-growing companies. The ‘scale-up visa’ is for graduates from approved universities with the offer of a job lasting at least six months, and a minimum starting salary of £33,000, from a business with at least 10 employees that has grown by 20% in the last three years.  

Businesses only have to sponsor the graduates for the first six months of their stay. After that, the worker has a further 18 months in the UK when they can work for any employer without further sponsorship. 

Possible policy changes 

During the run-up to the Conservative Party leadership election, Prime Minister Liz Truss referred to several employment policy issues she would pursue in government including: 

  • changes to the Working Time Regulations, especially the 48-hour week, taking breaks and calculating holiday pay  
  • reviewing the IR35 taxation rules. 

Consultations and reviews 

A number of policy proposals have emerged over the past few weeks, including the following: 

Exit payments: The UK Government first proposed recovering exit payments over £95,000 for public sector high earners in 2014. Since then, regulations have been produced, enforced, and removed. In August, another consultation was launched proposing new controls and reporting requirements on high severance payments. It closes on 17 October. 

Digital nomads: The Office for Tax Simplification (OTS) is considering whether current taxation and social security rules are a good fit for hybrid and distance working, and for those working from abroad. The OTS notes that around 40 tax jurisdictions offer ‘digital nomad’ visas and speculates on whether the UK is falling behind in attracting talent. This consultation closes on 25 November. 

Artificial intelligence (AI): The Equality and Human Rights Commission (EHRC) is looking at how local authorities are using AI and automated decision-making amid concerns that racial bias may be present in the delivery of services such as policing. The EHRC has also produced new guidance on using AI in the public sector. 

Menopause, whistleblowing and COVID-19 workloads 

These issues came up in three recent employment law cases: 

  • In McCabe v Selazar, an employment tribunal found in favour of a 55-year-old chief financial officer’s claims for age discrimination, whistleblowing, unfair dismissal and breach of contract after she was removed from her post while on annual leave. The claimant alleged that in an argument with the CEO prior to her departure, she was told not to let her hormones get out of control. The case is to be appealed.  
  • In Kong v Gulf International Bank, a business auditor raised compliance concerns with the head of legal who took the whistleblowing as an attack on her integrity and professional competence. The Court of Appeal found the auditor’s dismissal was due to the inappropriate way she had raised her concerns rather than the whistleblowing itself. There may be a further appeal to the Supreme Court. 
  • In Trapps v United Lincolnshire Hospitals NHS Trust, a hospital clerk was constructively unfairly dismissed when her workload became excessive during the pandemic. The employer’s reliance on inaccurate statistics when assessing her workload, and failure to provide any support, breached the implied term of mutual trust and confidence in her contract, entitling her to resign in response. 

Explore our resources on these subjects   

Bank holidays 

Right to work 


Possible policy changes  


Case law  

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