What do we know so far?
Last week the Labour Government confirmed that the policies set out in the “Plan to Make Work Pay” issued by the Labour Party on 24th May 2024 will be delivered. Specifically, a new “Employment Rights Bill” will set out the following commitments:
- Making parental leave, sick pay and protection from unfair dismissal available from “day one on the job for all workers”. However, employers will be able to operate probationary periods to assess new hires.
- Strengthening Statutory Sick Pay by removing the lower earnings limit to make it available to all workers as well as the waiting period.
- Flexible working “to be the default” from day one for all workers, with employers required to accommodate this as far as is reasonable.
- Strengthening protections for new mothers by making it unlawful to dismiss a woman who has had a baby for six months after her return to work, except in “specific circumstances”
- Establishing a new Single Enforcement Body, also known as a Fair Work Agency, to strengthen enforcement of workplace rights.
- Banning “exploitative” zero-hour contracts, ensuring workers have a right to a contract that reflects the number of hours they regularly work and that all workers get reasonable notice of any shift changes, with proportionate compensation for any shifts cancelled or curtailed.
- Ending ‘Fire and Rehire’ and ‘Fire and Replace’ by reforming the law to provide effective remedies and replacing the previous Government’s statutory code.
- Updating trade union legislation, removing “unnecessary restrictions” on trade union activity – including the previous Government’s approach to minimum service levels – and ensuring industrial relations are based around good faith negotiation and bargaining.
- Simplifying the process of statutory recognition and introducing a regulated route to ensure workers and union members have a “reasonable right” to access a union within workplaces.
- Establishing a Fair Pay Agreement in the adult social care sector and, following review, assessing how and to what extent such agreements could benefit other sectors.
Further, a new Equality (Race and Disability) Bill will be drafted to implement the following:
- Enshrining in law the full right to equal pay for ethnic minorities and disabled people, to enhance their ability to bring claims in respect of unequal pay.
- Introducing mandatory ethnicity and disability pay reporting for larger employers (those with 250+ employees) to help close the ethnicity and disability pay gaps.
What other proposals are forthcoming?
In addition to the key employment law provisions set out above, there were 38 draft bills noted on 17th July, some of which may also impact employers:
- A Pension Schemes Bill that encourages consolidation and focuses on value and outcomes for pension scheme members.
- New powers to sanction company directors for serious failures relating to financial reporting and audit responsibilities.
- Modernisation and strengthening of the Information Commissioner’s Office.
- The Border Security, Asylum and Immigration Bill, which seeks to tackle organised immigration crime and reform the asylum system.
- Enabling voluntary digital identification verification including in pre-employment checks.
- Further consideration of the regulation of AI.
- The establishment of a new body, Skills England, in partnership with employers;
- Reform of the apprenticeship levy.
When are the changes coming into force?
The Employment Rights Bill will be “introduced” within the first 100 days of the Labour Government; meaning no later than 12 October 2024. However, at the current time it is unclear if the Government will table the Bill immediately or consult on a draft.
We do not have as much information on the draft Equality (Race and Disability) Bill and so we anticipate this will be implemented following the Employment Rights Bill.
In any event, before a new bill comes into force, it will need to proceed through the House of Commons and the House of Lords and may be amended along the way. We also anticipate that various Codes of Practice and secondary legislation will be required to implement the relevant provisions. Therefore, at this stage it is not anticipated that any of the provisions noted above would be in force before 2025.
We await the publication of the draft legislation for further detail and clarification on the proposed timeframe.
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