Employment law reforms are on the way as the new Labour government plans to introduce a new employment rights bill. The bill is expected to include measures set out in the party’s Plan to Make Work Pay document, which was published before the election.
And while it appears good news for employees, research by the Institute of Directors reveals the news has raised concern among employers. The study shows 57% of business leaders are less likely to hire new workers due to the legislation. Meanwhile, the Business Secretary is opposing rules to hand workers full employment rights from day one in a job.
With plenty of time for lobbying and decision-making, there isn’t much detail about the plans just yet.
But what are the new measures likely to be? And how will it affect business owners and leaders? We are planning a workshop early in October about the plans and what they mean to employers and employees.
Here, we outline some of the measures the new government is considering.
What employment law reforms might mean
Right to predictable working hours
This legislation was expected to be introduced this autumn. The Workers (Predictable Terms and Conditions) Act 2023 received Royal Assent in September 2023 under the previous government. But the new government dropped this law earlier in September. A government spokesman told newspapers that a new ‘rights to a contract’ will be part of the new Employment Rights Bill.
Day one rights
Labour plans to introduce legislation to enforce basic rights from the first day of employment. In some cases, employers have been given a qualifying period before employees gain such rights. These include unfair dismissal, parental leave and sick pay from day one. Labour says this will help drive up standards in the workplace and encourage job mobility.
Zero-hour contracts
The plans include the end of zero-hours contracts. The Plan to Make Work Pay document states that contracts need to accurately represent the hours typically worked. And it adds it should ensure all employment positions offer a level of security and predictability.
Right to switch off
Under this proposal, employees will have a ‘right to disconnect’. That means employers will no longer be able to contact employees outside normal working hours. Labour says that homes shouldn’t become 24/7 offices.
Abolishing ‘fire and rehire’
There are times when employees are made redundant and then rehired under different terms and conditions. The government is planning on outlawing these proposals.
Sickness absence
The lower earning threshold for Statutory Sick Pay (SSP) eligibility will be removed. As with other ‘day one rights’ there will no longer be a waiting period before employees can access the benefit.
Flexible working
From the first day of employment, employers will be required to establish flexible working arrangements.
Carer’s leave
There is expected to be a review of carer’s leave for potential paid options. Bereavement leave entitlements for all employees is expected to be clarified.
New mums
Rights for new mothers will be strengthened. Dismissing a woman who has had a baby for six months will be unlawful in all but the most exceptional circumstances.
Pay gap reporting
Employers with more than 250 employees will need to compulsory report on ethnicity and disability pay gaps.
What should I do next?
We know that new legislation is always a difficult time for employers as they get to grips with changes. Often, there is concern around understanding how the changes will affect you.
Keep up to date with our LinkedIn account or News page for our workshop in which we will look at what the proposed legislation will mean to you.
In the meantime, you should:
- Review current employment contracts. Will they meet new legislation?
- Prepare for changes in managing performance and probation periods.
- Get to know the impact ‘day one’ rights might have on your approach to recruitment. You may have to take a more considered approach to recruitment in future.
In the meantime, if you would like to speak to one of our very experienced team members, contact us today for advice.