What does the new(ish) Labour Government mean for employment rights? At the TUC Annual Conference on 12th September 2023, Angela Rayner MP, promised that Labour would introduce an Employment Rights Bill within the first 100 days of entering office. Key proposals that Labour indicated the new Employment Rights Bill will introduce include the following: Day one rights Currently, an employee needs two years of service with their employer to qualify for an unfair dismissal claim (unless certain factors, such as discrimination are involved). The Plan to Make Work Pay states that ‘basic individual rights’ will be provided from day one for all workers, ‘ending the current arbitrary system that leaves workers waiting up to two years to access basic rights of protection against unfair dismissal, parental leave and sick pay.’ Employers will still be able to operate probationary periods (likely limited to six months) to assess new hires, but only where there are fair and transparent rules. This change could significantly expand workers’ rights, offering increased protection. However, some employers may become more hesitant to hire new employees. In its Plan to Make Work Pay, Labour committed to ending the practice of ‘fire and rehire’ as a lawful means of changing contractual terms. While businesses must restructure when genuinely necessary, it believes this ‘must follow a proper process based on dialogue and common understanding.’ The law will be reformed to provide effective remedies against abuse and a strengthened statutory code will replace the current one. This is likely to be a popular move among employees, especially given recent high-profile cases of employers like Tesco seeking to use this technique to push through changes to terms and conditions. Discrimination and diversity, equality and inclusion Labour has made several commitments regarding discrimination and diversity, equity and inclusion (DEI): Labour promised to create the position of Secretary of State for Women and Equalities for the first time. However, Bridgit Phillipson MP and Anneliese Dodds MP, have been appointed to the lesser roles of Minister for Women and Equalities. Labour committed to requiring employers to create and maintain harassment-free workplaces, including by third parties. To tackle sexual harassment at work, it will strengthen the legal duty for employers to take reasonable steps to stop it. Labour also committed to making flexible working a default right unless employers have a valid reason to refuse. Ending one-sided flexibility Labour declared it would end one-sided flexibility and ensure jobs provide a baseline level of security and predictability by: Banning exploitative zero hours contracts. Ensuring that workers have the right to: contract reflecting the hours they regularly work, based on a 12-week reference period. reasonable notice of any shift changes, with compensation proportionate to the notice given for any shifts cancelled or curtailed. Workers will retain the right to overtime pay. Employment tribunal proceedings The Plan to Make Work Pay confirmed that the time limit for bringing an employment tribunal claim will increase from three to six months. Previous indications included: Tougher penalties on employers who break the law or fail to comply with tribunal orders, including personal liability for directors. The removal of caps on compensation payable to workers following breaches of the law (currently capped at one year’s pay or £115,115 for unfair dismissal claims). It therefore appeared that the statutory cap on unfair dismissal compensation and the cap on a week’s pay for the purpose of calculating certain compensatory payments would be disapplied. At time of publication, it is unclear if these proposals are still under consideration. Statutory sick pay (SSP) The Bill is expected to provide sick pay from day one for all workers, as the first three days of SSP are currently unpaid. The Employment Rights Bill has the potential to fundamentally change employment rights, significantly impacting how businesses operate concerning employees and what employees expect from employers. These are just a selection of the proposals, but if introduced, these changes will require serious consideration by both employers and employees regarding recruitment, operations and policy implementation. How can Morr & Co help? If you have any questions or would like any further information on the content of this article, please do not hesitate to contact our Employment team on 01737 854500 or email info@morrlaw.com and a member of our expert team will get back to you. Disclaimer Although correct at the time of publication, the contents of this newsletter/blog are intended for general information purposes only and shall not be deemed to be, or constitute, legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article. Please contact us for the latest legal position. Authored by Francesca Wild Senior Associate Solicitor Message Tags Insights Perspectives On this page Related Stories Insights Corporate Insights Labour’s plan to assist small businesses with unpaid invoices View more Contact our team today Contact Us
