Yesterday, the UK Government revealed the Employment Rights Bill (the Bill), which set out their Plan to Make Work Pay. By introducing the Bill, Labour met their promise to introduce legislation on employment rights within 100 days of taking office. This was billed as a 'once in a generation' reform of employment rights, but what does the Bill actually say and, perhaps more importantly, what does it not?
What does the Bill say?
The Bill sets out 28 reforms; below are some of the key takeaways:
- Day-one rights: The Bill removes the qualifying period for Paternity, Parental and Bereavement Leave. This means that employees will be entitled to these rights from the first day of their employment.
- Unfair dismissal: The qualifying period for Unfair Dismissal has been removed for those who have already started work.
- Flexible working: Any refusal must be reasonable. The Bill sets out a list of grounds (not dissimilar to the previous grounds) which an employer can cite when refusing a flexible working request; however, the Bill now holds that refusal must also be reasonable.
- Sexual harassment and third-party harassment: Employers will now be liable for third-party harassment. The Bill also enhances the burden on employers to take all reasonable steps in the prevention of sexual harassment of their employees in the workplace (including in the prevention of third-party harassment). This appears to hold employers to a higher standard than what is being proposed by the Worker Protection Act coming into effect on 26 October 2024.
- Zero-hours contracts: Employers will now be required to offer a guaranteed hours contract which reflects the number of hours regularly worked. Workers will also be entitled to 'reasonable' notice ahead of changes to their shifts and receive payment for cancellation of shifts if done on short notice.
- Fire and rehire: It will be automatically unfair to dismiss an employee for refusing a contract variation. Employers will only be able to offer reengagement where there is a business restructure and there is no alternative.
- Sick pay: Statutory sick pay can now be received from the first day of sickness, and the requirement to earn more than £123 will be removed. Under current rules, an employee must have been ill for at least three days and earn more than £123 a week.
What is missing?
The Government has also released a policy paper today entitled 'Next Steps to Make Work Pay'. This paper outlines additional reforms which haven't been addressed in the new Bill. Importantly, no dates have been committed to.
The Bill does not confirm the new statutory probationary period; instead, the Government have advised that they will undertake a consultation on this point. Additionally, the Government has said that further reforms will be dealt with later, including the right to switch off, a requirement for larger employers to report on their ethnicity and disability pay gap, and a move towards a single status of worker.
What is the timeline?
These changes will not come about quickly. The Bill may take between 12-18 months to pass through Parliament, and much of the detail omitted from the Bill will be agreed through consultation and secondary legislation and will therefore not come into force until 2026 at the earliest.
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