Welcome to our September 2025 Employment Law Update!
This month’s review includes key court rulings on National Minimum Wage and employment status, updates on parental leave reform, guidance on single-sex spaces and the latest developments on the Employment Rights Bill.
Payment of NMW for time spent travelling
A recent Court of Appeal ruling has reaffirmed the principle that employers do not have to pay workers for time spent travelling between home and work, regardless of how long that takes. HMRC issued a notice of underpayment of National Minimum Wage (“NMW”) to an employer, TSL, that provided minibus transport to take workers from their homes to their places of work (various poultry farms). Travel times could be very long, with some workers travelling up to eight hours a day, for which they were paid at £2.50 an hour. Both the Employment Tribunal and the EAT upheld the employer’s case, that this did not constitute working time under the NMW Regulations, as contended by HMRC. The Court of Appeal agreed with the EAT. This is a useful reminder that employers are not required to pay for time spent in transit between home and work; payment is only required if travel is undertaken when the worker would otherwise be working, such as travelling between assignments. You can read the judgment here.
Single sex spaces: EHRC policy review
The EHRC now sent its revised code of practice regarding single-sex spaces following the Supreme Court judgment in For Women Scotland v Scottish Ministers, to the Minister for Women and Equalities for approval. In advance of the Code being published, Baroness Falkner notes that employers and service providers are responsible for ensuring they comply with the law and should “seek independent legal advice where necessary.” The EHRC has also completed its review of evidence on single-sex space policies, following a 2024 government request for information. As a result, it has written to 19 public organisations with policies that misrepresent the Equality Act 2010 by suggesting that self-identification confers an automatic legal right to access single-sex spaces.
Parental leave and pay review
The Government launched a review of the parental leave and pay system which, it has recognised, has become very complicated due to the piecemeal nature of its evolution. It is due to conclude in December 2026, reporting in January 2027.
The aim of the review is to:
- Set out objectives for the parental leave and pay system and what an improved system should deliver.
- Understand what works well for families and employers and what is not working well, including comparisons with international models.
- Consider what type of system would support the objectives at low or no cost to employers and the exchequer.
- Deliver an implementation plan for moving to a better system within current financial constraints.
Employment Rights Bill: update
The Government timeline with the proposed implementation dates for the Employment Bill was published on 1 July, with the last lot of amendments tabled by the House of Lords on 7 July 2025, before Parliament rose for the summer. It is now (September) back with the House of Commons to consider the Lords’ amendments, with the expectation that it will receive Royal Assent later this year. In the meantime, we list the key provisions below and encourage all employers to undertake a thorough review of how the changes will affect them and which policy and procedure processes will need to be updated along with additional training requirements for staff and managers alike. You can view our dedicated article with the latest Employment Rights Bill updates here.
Case Update
Ryanair loses appeal regarding employment status of pilot
Lutz v Ryanair & Storm Global
Mr Lutz applied to Ryanair to be employed as a pilot. He was offered a position with the airline as a ‘contracted pilot’ for a five-year fixed term by an agency, Storm Global. Mr Lutz was instructed to supply his services to Ryanair via a personal service company, set up by Storm Global, resulting in him being part of a three-way relationship. Ryanair was described as the ‘hirer’ and the agreement referred to Mr Lutz as an ‘independent consultant’, although he was paid by Storm Global via his personal service company (with which he had little to do). This arrangement meant that he was not paid holiday pay. His contract ended after two years, following which Mr Lutz brought a claim for unpaid holiday pay against Storm Global, and an equal terms claim against Storm Global and Ryanair.
At Tribunal, the question was whether or not Mr Lutz could be employed by Storm Global when operational control of his day-to-day employment was directly managed by Ryanair. The Tribunal ruled that the personal service company was a sham and that he was an agency worker under the Agency Workers Regulations, and that he was also a crew member as defined under the Civil Aviation Working Time Regulations, employed by Storm Global and thus entitled to holiday pay. Storm Global and Ryanair’s appeal to the EAT failed so they appealed to the Court of Appeal.
The Court of Appeal upheld the ET’s ruling. The Court of Appeal confirmed Mr Lutz’s claim that he was an agency worker, employed by Storm Global to supply his services to Ryanair on a temporary fixed-term contract. This case is a useful reminder that if the facts clearly indicate the existence of an employment relationship between two parties, anything to the contrary stated in a contract of employment may be meaningless - it is the reality on the ground that matters. In the light of this ruling, employers who use independent contractors should review the arrangements under which their services are supplied.
NB: Ryanair lodged permission to appeal to the Supreme Court in August 2025 to which the outcome is still awaited.
The information provided in this article is provided for general information purposes only, and does not provide definitive advice. It does not amount to legal or other professional advice and so you should not rely on any information contained here as if it were such advice.
Wright Hassall does not accept any responsibility for any loss which may arise from reliance on any information published here. Definitive advice can only be given with full knowledge of all relevant facts. If you need such advice please contact a member of our professional staff.
The information published across our Knowledge Base is correct at the time of going to press.
