As we approach Labour's 100th day in government, their much-anticipated Employment Rights Bill has been unveiled. First announced in the King's Speech on 17th June 2024, the Bill forms part of Labour's promise to introduce drastic reforms to employment law within their first 100 days in power, although these are unlikely to come into force within the next 2 years. Their manifesto pledge to 'Make Work Pay' has included a wide range of changes that would transform workers' rights and certain workplace practises. Here is a summary of what reforms the Employment Rights Bill is looking to introduce, and how they could impact both employees and employers.
Bringing an End to 'Exploitative' Zero Hours Contracts
In the Employment Rights Bill, the government has pledge to bring an end to 'exploitative' zero-hours contracts by ending 'one sided' flexibility, although details of what this would look like in practise remain unclear. They have also promised to grant workers the right to a contract that reflects the number of hours they regularly work as a way of protecting against employees exploiting 'flexible work' that limits the rights of their employees.
Rights from Day One
A major part of the new government's proposal to reform workers' rights has focused on removing waiting times for certain rights to kick in. The Bill pledges to give workers protection against unfair dismissal from day one of their employment, rather than the two years employment currently required although they have stated that this will not prevent fair dismissal, which includes dismissal for reasons of capability, conduct or redundancy, or probationary periods with fair and transparent rules and processes. As such, the Employment Rights Bill will entrench unfair dismissal protection as a day one right. Further, it seeks to remove the need to work for an employer for one year or more to be eligible for parental leave and grant entitlement to statutory sick pay for workers on their first day of illness, rather than the fourth day under the current law.
Removing Lower Earnings Limits on Statutory Sick Pay
As part of the extension of the protection offered by statutory sick pay, Labour have pledged to remove the lower earning limits as part of the Employment Rights Bill. Currently, you must earn over £123 per week to be eligible, calculated by taking an average of the previous 8 weeks. Removing this limit would extend statutory sick pay to all workers, including those on lower and inconsistent incomes.
Maternity Leave Protections
The Bill will bring into force greater protection for pregnant women and new mothers. This would include making it illegal for someone to be dismissed while pregnant, on maternity leave or within 6 months of returning from maternity leave. Beyond this, the government is looking to improve work for families in the Bill by making the right to flexible work a default right and by introducing a new right to bereavement leave.
Restricting 'Fire-and-Rehire' Practices
The new government has promised to restrict the practise of firing and rehiring staff on lower pay and reduced terms, which was famously used by P&O ferries in 2022, by replacing the current statutory code, which they have labelled as 'inadequate'. The Employment Rights Bill contains this reform as part of extending workers' rights to job security and the ability to negotiate their contracts in good faith.
Labour's Employment Rights Bill represents a bold step towards reshaping the UK's employment landscape, with significant reforms that promise to enhance protections for workers. As businesses and employees prepare for the potential shift, the Bill's proposals could significantly transform workplace practices and redefine the balance between employee rights and employer responsibilities.
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