With a general election due by January 2025 and rumours of an autumn election swirling, campaign efforts have been ramped up. Current polling suggests a win for Labour, with the “biggest upgrade of workers’ rights in a generation” being promised by the party and it has committed to introducing employment legislation within 100 days of power. We look at what the potential changes to employment law could be and the consequential impact on employers.
As part of Labour’s ‘New Deal for Working People’, first published in a Green Paper in September 2023, the party has pledged to strengthen the protections afforded to all workers “by banning zero-hours contracts, ending fire and rehire, and scrapping qualifying periods for basic rights”, which is understood to be a promise to get rid of the two years’ continuous service necessary before can employee is eligible for statutory redundancy pay and has a right to not be unfairly dismissed (although automatically unfair dismissals do not require a qualifying service period), as well as the qualifying period of 26 weeks for parental leave and the creation of a single worker status for all but the genuinely self-employed.
Angela Rayner, Shadow Deputy Prime Minister, described this as a “comprehensive package of measures that will start to address the imbalance of power in Britain’s workplaces.”
Labour’s Green Paper set out over 50 proposals for changes to workplace rights and decried the UK as having some of the longest working hours in Europe and a “long-hours culture”. A ‘right to switch off’ has been proposed, which would give workers the right to disconnect from work outside of working hours and not be contacted by their employer outside of working hours. A further suggestion of the introduction of protections for workers against remote surveillance has also been made, to keep pace with the changing nature of work and technology.
Mental health has also been prioritised and will be put on a par with physical health in the workplace, with a review of the law on health and safety at work in order to revise outdated legislation and made fit for modern life, taking into consideration provisions for stress and the impact of new technology.
Labour has said it will raise awareness of neurodiversity in the workplace, and across wider society, repeal trade union laws introduced over the last few years during the Conservative party’s tenure and make Statutory Sick Pay available to all workers, meaning those that are currently ineligible due to low earnings would be granted support when unable to work due to illness.
There are also plans to introduce mandatory disability and ethnicity pay gap reporting for employers with over 250 employees, as is already a statutory requirement for such employers on gender pay. The Government consulted on mandatory ethnicity pay reporting in 2023 and concluded that it may not always be an “appropriate mechanism” for all employers. They decided not to make it mandatory and instead issued guidance for employers who voluntarily report.
Whilst Labour have stated they will “bring about stronger family-friendly rights” and make flexible working a day one right, alongside many more proposals, a host of legislation has been passed by the current government which address some of the issues raised by Labour, including the introduction of the right to request flexible working as a day one right and carer’s leave (coming into force on 6 April). Additionally, the Conservative government has previously consulted on employment status, with their conclusion being that the three-tier approach in place was suitable and allowed flexibility in the labour market.
The Government also recently announced it will tackle the use of ‘fire and rehire’ practices, with a new statutory Code of Practice published on 19 February to lay out how employers must behave in this area.
A policy paper entitled ‘Smarter Regulation to Grow the Economy’ was published by the Government in May 2023, in which proposals were tabled to limit non-compete clauses to 3 months. Although that has not been enacted, other proposals in this paper (some relaxation of Working Time Regulations and TUPE requirements) have been legislated on already, as part of the Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023.
Businesses have come forward with reservations about Labour’s proposals. Concerns about cost, removal of unsuitable workers and implementing operational changes abound. The Deputy Director of Public Policy at the British Chambers of Commerce has said that in order to protect jobs and the economy, “any changes to legislation must be proportionate and affordable”.
The president of the CBI lobby group, Rupert Soames, has said that it was pushing Labour to soften its plans, citing concerns that the measures could undermine economic growth.
With a general election many months away and no doubt that any new legislation tabled would take some time before it became law, there is no immediate urgency to review and update workplace policies based on what has been proposed. However to be forewarned is forearmed and if Labour’s plans come to fruition, employment contracts and policies could need to be updated fairly quickly. It is certainly an interesting time in the employment law sphere, with much debate about workers’ rights and the numerous changes which are already coming into force this year.