The Bill sets out the employment rights and policies which the Labour Government intends to introduce. The Bill strengthens a number of existing working rights in addition to introducing some new rights and policies. This analysis contains an overview of the incoming legislation and commencement dates as well as a brief summary of each new right.
Our view is there are some good changes and some not so good changes:
1 The removal of the 2 years qualifying period for unfair dismissal statutory protection is watered down by the introduction of the 9 months probationary period where dismissals for specified reasons will not be deemed unfair. But note that France’s unemployment rate (where this day 1 right exists subject to a shorter probationary period) is double that of the UK.
2 Sick pay, parental and maternity rights changes are fair.
3 The changes to the industrial action thresholds will lead to more strikes.
4 The Employment Tribunal is already clogged up with cases waiting to be heard. These new rights will lead to an increase in the number of disputes because they give greater rights to employees and unions. The Tribunals will need greater resources – where are they going to come from?
Unfair dismissal qualifying period
The right not to be unfairly dismissed generally only arises where the employee has been continuously employed for a period of at least two years. However the rule is subject to a number of statutory exceptions. The Bill will remove the 2 years qualifying period.
Probationary periods
The Bill introduces the concept of an ‘initial period of employment’ (or ‘probationary period’) where dismissals for specified reasons will not be considered unfair. This period will be 9 months.
The government has committed to consulting on the length of that initial statutory probation period and to consult on how it interacts with the Acas Code of Practice on disciplinary and grievance procedures to ensure that day 1 rights will not be affected by the statutory probation period.
Sick pay (SSP)
SSP is currently available to employees who are deemed to have been too ill to undertake any work for a period of at least four consecutive days. Employees must also earn above the lower weekly earnings limit (currently at £123) in order to qualify for SSP. The Bill makes it a day 1 right and removes the lower limit.
Flexible working
Employees have a statutory right to request certain specified changes to their employment contract. However. employees must have had at least 26 weeks of continuous service in order to qualify for the right. The April 2024 legislation made it a day 1 right.
The Bill introduces a reasonableness requirement into an employer’s decision not to grant flexible working requests, and requirement for the employer to explain to the employee why they consider it reasonable to refuse the request.
Zero hours contracts
Zero-hour contracts are contracts of employment which lack a minimum number of guaranteed working hours and which do not require a minimum commitment from the employee. This means the working hours of an individual are unpredictable and may vary wildly from week to week.
The Bill sets out a right to guaranteed hours where a worker regularly works more than those hours. The guaranteed hours are calculated according to a 12-week reference period. Employers will be required to make an offer of guaranteed hours to workers at the start of employment and at the end of each reference period. Workers can also submit claims to the employment tribunal where an employer has failed to comply with their duty to offer guaranteed hours, or where that offer does not comply with the necessary requirements.
Fire and re-hire (dismissal and re-engagement)
Currently, employers wishing to introduce changes to the terms and conditions of an employment contract have the option of terminating the contract (with the requisite notice) and offering immediate re-engagement to the affected employee on new terms.
A dismissal is unfair where the reason for the dismissal is that:
- •the employer sought to vary an employee’s contract and the employee did not agree, or
- •the employer sought to employ another person or re-engage the employee under a varied contract to carry out substantially the same duties.
This will not apply where the employer shows that the reason for the variation was to eliminate, prevent or significantly reduce, or significantly mitigate the effect of, any financial difficulties which at the time of the dismissal were affecting, or were likely in the immediate future to affect, the employer’s ability to carry on the business as a going concern or otherwise to carry on the activities constituting the business, and in all the circumstances the employer could not reasonably have avoided the need to make the variation.
Parental leave
Parents of a child (whether born to the parents or adopted) are entitled to take up to 18 weeks of unpaid leave to care for that child at any time before the child’s 18th birthday. Currently parents must have worked continuously for an employer for at least one year to qualify for parental leave. The Bill makes it a day 1 right.
Protection for new mothers
Currently, dismissal on the grounds of pregnancy or maternity will be deemed to be an automatically unfair dismissal. This means that an employee dismissed under these circumstances does not require the 2 years of continuous employment ordinarily needed to bring a claim in the employment tribunal. A woman who takes ordinary maternity leave is also entitled to return to the ‘same job’ at the end of that leave unless that job is no longer available.
There is a promise to strengthen these protections by making it unlawful, except in specified circumstances, to dismiss a woman who has had a baby for six months after she returns to work.
Paternity leave
An employee may take paternity leave to support a mother or adopter in taking care of a new child, subject to (among other things) having at least 26 weeks’ qualifying employment.
This will become a day 1 right.
Bereavement leave
Employees are entitled to parental bereavement leave (PBL) following the death of a child if they meet the requisite parental relationship conditions and comply with the notice requirements. PBL is a ‘day one’ right. However it is currently only available to employees.
The Bill extends the right to take PBL to any ‘bereaved person’. PBL will no longer be limited to circumstances involving the death of a child. A bereaved person will be entitled to take leave for the death of any person as long as they meet the other relevant conditions set out in the regulations.
Harassment
The Bill contains new provisions on sexual harassment, expanding the duty to prevent sexual harassment set to come into force on 26 October 2024.
The new sections introduce:
- liability for harassment by third parties
- provision for disclosures about sexual harassment qualifying as a protected disclosure under ERA 1996
- the addition of specified steps that an employer must take to demonstrate that they have taken reasonable steps in the prevention of sexual harassment for the purposes of the legislation.
Equality Action Plan
The Bill will require large employers to publish equality action plans showing the steps that the employer is taking in relation to their employees with regard to prescribed matters related to gender equality, and to publish prescribed information relating to the plan. These will need to cover addressing the gender pay gap and supporting employees going through the menopause.
Single Enforcement Body (Fair Work Agency)
The Labour Party has committed to amalgamating the HMRC National Minimum Wage unit, the Employment Agency Standards Inspectorate and the Gangmasters Labour Abuse Authority into a single enforcement body known as the Fair Work Agency.
Trade unions
The Employment Rights Bill makes provision for changes to trade union law relating to:
- a worker’s right to a statement of trade union rights
- a trade union’s right of access to a workplace
- trade union recognition
- members’ contributions to political funds, and public sector check-off arrangements
- time off rights for trade union officials, learning representatives and union equality representatives
- blacklisting
Industrial Action
Changes are proposed in relation to:
- balloting and notification requirements for lawful industrial action
- lawful picketing
- detriment and dismissal for participating in lawful industrial action
- restrictions on those working in regulated services from participating in industrial action
Ballot participation thresholds will be done away with and support thresholds for industrial action will be the majority of those voting in the ballot. Additional balloting thresholds for those engaged in public services will also be done away with. Information that must be included on the voting paper in a ballot is to be significantly reduced and simplified. Provision is made for electronic balloting to be introduced.
The period of notice to be given to an employer to notify it of industrial action is to be reduced from 14 days to seven days.
Repeal of minimum service levels
The Strikes (Minimum Service Levels) Act 2023 is to be repealed, and industrial action restrictions on workers working in services that have been designated ‘relevant’ services under the Act are accordingly lifted.
Coming into force
Commencement regulations will be required to bring the provisions into force, with the exception of provisions on trade unions and industrial action, which will come into force 2 months from the day on which the Act is passed, and the repeal of the Strikes (Minimum Service Levels) Act 2023 and related provisions, which will come into force on the date the Act is passed.
Tom Redfern email:tredfern@redfernlegal.com
