The Employment Rights Bill was introduced on Thursday 10th October 2024 in what Ministers say will help to deliver economic security and growth to businesses, workers and communities across the UK.
The comprehensive package introduced 28 new measures, including long-awaited reforms to parental and bereavement leave, sick pay, and unfair dismissal regulations.
A summary of the Employment Rights Bill is outlined here, however it is unlikely any of these changes will become law before 2026.
Flexible working
Flexible working will become the default right for all employees, unless the employer can demonstrate it is “unreasonable.” The Government estimates that 1.7 million people currently outside the labour market could re-enter the workforce as a result of flexible working and related policies.
Parental and bereavement leave
The Bill introduces ‘day one’ rights for paternity, parental, and bereavement leave, benefiting millions of workers. This ensures that fathers or partners are entitled to paternity leave and have the right to unpaid leave from the start of their employment. Additionally, a new entitlement to bereavement leave will be established for all workers. Pregnant women and new mothers will receive increased protection from dismissal during pregnancy, throughout maternity leave, and for up to six months after returning to work.
Sick Pay
Statutory sick pay will be enhanced by eliminating the lower earnings limit, making all workers eligible regardless of income, and removing the waiting period before sick pay begins. Currently, workers earning less than £123 per week do not qualify. The Bill will also allow sick pay to begin on the first day of illness, replacing the current three-day waiting period.
Unfair Dismissal
The intention is for workers to have this right to claim for unfair dismissal from day one in the job, removing the current two-year qualifying period. However there will be a consultation on this part of the plan as it’s one of the more complex elements for businesses. The proposed new statutory period – expected to be around nine months – will promise employers a “lighter touch” process covering dismissals.
Zero hours contracts
The bill aims to end exploitative zero-hours contracts by giving workers the right to guaranteed hours. Employers will be required to offer guaranteed hours contracts based on a 12-week reference period, and casual workers will be entitled to a fair number of shifts as well as financial compensation if a shift is canceled or shortened. However, the bill does not fully ban zero-hours contracts, allowing individuals to remain on such contracts if they prefer. This compromise has sparked debate among unions, some of which had pushed for a complete ban on insecure contracts.
The Employment Rights Bill, introduced by the Labour Government and believed to be championed by Deputy Prime Minister Angela Raynor claims the legislation will “strengthen the collective voice of workers”, however it has been met with a mixed reaction from both businesses and employees.
Next steps for businesses
There are many details in the bill that are still to be settled, however based on the what we know so far businesses should start to familiarise themselves with the proposals and begin assessing how these changes could affect their business, in particular their workforce planning.
Consider if any decisions need to be made with regards to recruitment, contracts, polices and procedures within the business.
As an experienced employment solicitor I am on hand to help businesses and employees navigates these issues and help prepare for these changes within the business ahead of them becoming legal requirements.
If you would like to discuss how these changes will affect your business, please do not hesitate to contact me on annabel.cole@cognitivelaw.co.uk