The new Labour government has laid out plans to change employment law through an employment rights bill (ERB) and a draft equality (race and disability) bill.
While we wait for the details of draft legislation, this is what we know so far.
Employment rights bill (ERB)
Labour’s manifesto made clear that it would introduce wide-ranging legislation within 100 days of being elected. The explanatory notes that accompanied the ERB confirmed that the new government proposes the following policies across the UK:
- Creation of a new single enforcement body to strengthen the enforcement of workplace rights. The lack of adequate enforcement is widely acknowledged as a barrier to access to justice. For example, the Taylor Review reported as much back in July 2017. Employment tribunal claims often still take years before a final hearing, and a high proportion of successful awards go unpaid.
- Banning exploitative zero-hours contracts (ZHCs). Many practitioners will view this with particular interest, given the increased use of such employment contracts in recent years. The related topic of ‘employment status’ will also inevitably need consideration because of disputes over whether those employed under ZHCs are workers, employees or genuinely self-employed.
- Ending the practice of ‘fire and rehire’. This is another policy that will face scrutiny due to the current prevalence of dismissal and re-engagement by businesses seeking to force reorganisation in order to survive. A major concern relates to unintended redundancies from legislation that is too blunt. However, few can argue against the need for legislation to prevent fire and rehire being used as a knee-jerk reaction, rather than as a last resort, by a struggling business.
- Amending parental leave, sick pay and unfair dismissal protection to make it available from day one for all workers, subject to probationary periods for new starters. The introduction of ‘day one’ rights is controversial with regard to the potential impact on small businesses, although it will be welcomed by low-paid and vulnerable workers as well as the trade unions that represent them.
- Extending protections to make it unlawful, subject to limited specified circumstances, to dismiss a woman who has had a baby for six months after she has returned to work.
- Removing the lower earnings limit and the waiting period from the eligibility criteria for recipients of statutory sick pay.
- Updating trade union legislation. This is expected to involve the repeal of the Trade Union Act 2016 and Strikes (Minimum Service Levels) Act 2023 and bring reforms that widen access for trade unions to enter workplaces for the purpose of collective bargaining.
- Introducing sectoral collective bargaining through a fair pay agreement (FPA) in the adult social care sector, and reinstatement of the School Support Staff Negotiating Body. The former is the first FPA in the UK and may follow models used overseas. The latter was dropped by the Conservative-led coalition in 2010 because it did not fit with the (then) government’s priorities for greater deregulation of pay and conditions for the estimated 500,000 support staff in UK schools.
Draft equality (race and disability) bill
The aim of this draft bill is, we are told, to ‘enshrine the full right to equal pay in law’ for those who are ethnic minorities and those who are disabled.
The bill would also introduce mandatory ethnicity and disability pay reporting for employers with 250 or more employees. This is because pay disparities exist for most ethnic minority groups compared with white British groups and also for disabled people in comparison with non-disabled people.
Rather than following the format of the ERB, this draft bill is due to be published for consultation before it is presented to Parliament, so it will undoubtedly face comparison with the historical process that was followed for equal pay and gender pay gap reporting.
We might all hope that this runs more smoothly than the equal pay matters that have been troubling employment tribunals for some decades.