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Labour’s First 100 Days in Employment Law: A review of Progress to Date and What Lies ahead in the next 12 – 24 months
Introduction
The Labour Party came into power in 2024 with a promise of substantial reforms aimed at enhancing worker’s rights, improving work-life balance, and addressing inequalities in the workplace.
The Employment Rights Bill
In its first 100 days in office, the Labour Government has introduced The Employment Rights Bill setting out the framework for sweeping changes to employment law, significantly impacting both employers and employees. The Bill is now making its way through Parliament, having had its second reading in the House of Commons on 21 October 2024, although it will be a while before it finishes its passage through Parliament; the final version is approved by the House of Lords and the legislation comes into force by Royal Assent.
A list of the reforms contained in the Employment Rights Bill can be found in the Government’s fact sheet Employment Rights Bill overview
The Bill is still under review and comment including subject to the outcome of public consultation.
Public Consultations
The first three consultations have now been issued by the Department of Trade and Industry (closing date 2 December 2024) seeking views about:
1. Zero Hours Contracts - Extending the zero hours contract provisions in the Bill to agency workers including, if extended, how the obligations would be apportioned between the agency and the hirer. https://www.gov.uk/government/consultations/making-work-pay-the-application-of-zero-hours-contracts-measures-to-agency-workers
2. Collective redundancy and ‘fire and rehire’ practices: The Bill’s proposals:
(i) to increase the maximum penalty payment (known as the protective award) payable to employees by employers abusing the rules about collective consultation from 90 days to 180 days or to remove the cap entirely.
(ii) whether to award interim relief to employees making a claim for a protective award.
(iii) In the case of a ‘fire and rehire’ scenario, whether interim relief should be available for employees claiming unfair dismissal.
The Government is also proposing to gather further views about collective redundancy consultation in 2025 including about doubling the minimum consultation period where an employer is proposing to dismiss 100 or more employees from 45 days to 90 days.
3. The Proposals to modernise Trade Union law.
Further Consultations about modernising trade union law will take place once the current Employment Rights Bill has received Royal Assent, so will not come into force any time soon.
A fourth consultation has been issued by the Department for Work and Pensions (closing on 4 December 2024) relating to:
4. Calculation of SSP: The Bill proposes to remove the current three-day waiting period so that it is available to employees from the first day of sickness absence. It will also remove the lower earnings threshold so that all employees are eligible for SSP. However, some lower paid workers will not be eligible for the flat rate of SSP. The intention is that their SSP will be calculated as a percentage of earnings and the consultation seeks views about the percentage. There is a hint that this might be between 60% - 80%, based on the examples given in the consultation.
The Government anticipates consulting on the remaining reforms in the Bill in 2025, including the proposal to make unfair dismissal a day one right, which has received a lot of attention. The consultation will include the proposal for a lighter-touch dismissal process during a probationary period to enable employers to fairly dismiss employees during the first months of employment if it is not working out. Current suggestions are a six- or nine-month period.
The results of the consultations may influence the final version of the Employment Rights Bill.
The Employment Rights Act [2026]
Once the Employment Rights Bill receives Royal Assent, it will become the Employment Rights Act. It is important to note that the Employment Rights Bill will not provide the detailed legislation about all the changes. It does make provision for the Government to make further regulation about the detail, which will also need to go through Parliament for approval.
Most of the reforms including the day one right to unfair dismissal are not expected to come into force before 2026.
Next Steps for Employers
Employers will be keeping a watching brief on the progress of the reforms including the consultations and considering the impact of the proposed legislation on their HR needs now.
Employers will wish to review and update their HR Policies and prepare for the changes.
If you have any questions about the new reforms, would like to be kept up to date, or need assistance with preparing for them, please do not hesitate to contact Springhouse Solicitors, part of the Kilgannon & Partners LLP Group, employment and immigration law specialists.
Our expert employment law solicitors all have many years’ experience advising individuals who are in your position. We will be able to guide you through the process and to help you secure the best possible outcome.
We offer a range of services, so please contact our friendly customer services team to discuss further via hello@kilgannonlaw.co.uk or 0800 915 7777.
Disclaimer
The above provides a general overview of areas in employment law and is not intended nor construed as providing specific legal advice.
This article is for information purposes only and is correct at the time of publication. It does not constitute legal advice.
27.10.24
