In a landmark shift for UK employment law, the newly elected Labour government has unveiled an ambitious agenda to overhaul workers' rights and reshape the employment landscape. Prime Minister Keir Starmer's administration has committed to introducing legislation within its first 100 days in office, which will take the form of an Employment Bill, signalling a rapid and comprehensive transformation of workplace regulations.
Day One Rights
Unfair Dismissal Protection: Employees will have the right to claim unfair dismissal from their first day of employment, rather than after two years of service. However, employers will still be able to operate probationary periods with fair and transparent rules and processes.
Statutory Sick Pay (SSP): SSP will be payable from the first day of sickness, rather than the fourth day. The lower earnings limit for SSP eligibility will also be abolished.
Parental Leave: The right to parental leave will become a day one entitlement, removing the current one-year service requirement.
Flexible Working: Flexible working will become the default arrangement for all workers from day one, except where it is not reasonably feasible.
Employment Status and Contracts
Single Worker Status: The government plans to move towards a simplified two-tier system of "worker" and "self-employed," merging the current categories of employee and worker. This change will extend various employment rights to a broader group of workers.
Zero-Hours Contracts: "Exploitative" zero-hours contracts will be banned. Workers will have the right to a contract reflecting their regular hours, based on a 12-week reference period.
Fire and Rehire: The practice of "fire and rehire" will face stricter controls, with a strengthened code of practice replacing the current statutory code.
Equality and Inclusion
Pay Gap Reporting: Large employers (250+ employees) will be required to report on ethnicity and disability pay gaps, in addition to existing gender pay gap reporting. They will also need to publish action plans for closing these gaps.
Menopause Action Plans: Large employers will be required to produce menopause action plans demonstrating how they support employees going through menopause.
Equal Pay Claims: The right to make equal pay claims will be extended to include race and disability, not just sex.
Trade Union and Collective Rights
Workplace Access: Trade unions will be given a reasonable right to access workplaces for recruitment and organising purposes.
Collective Consultation: The threshold for triggering collective redundancy consultation will be changed to consider the number of redundancies across the entire business, rather than at individual establishments.
Union Recognition: The process for statutory recognition of trade unions will be simplified, with changes to voting thresholds.
Additional Employment Law Changes
Employment Tribunal Time Limits: The time limit for bringing claims to employment tribunals will be extended from three to six months.
National Living Wage: The National Living Wage will be extended to all adult workers, with the Low Pay Commission considering the cost of living when setting rates.
Bereavement Leave: A new statutory right to bereavement leave for all workers will be introduced.
Right to Switch Off: Labour plans to introduce a "right to switch off," encouraging policies that protect personal time when working remotely.
Single Enforcement Body: A new Fair Work Agency will be established to enforce workers' rights and have powers to inspect workplaces and take legal action against non-compliant employers.
As the government begins the process of drafting and implementing these sweeping reforms, businesses and workers alike are bracing for significant changes in the employment landscape. While supporters hail these measures as a long-overdue upgrade to workers' rights, critics warn of potential impacts on business flexibility and costs. The coming months will be crucial as the details of these proposals are fleshed out and debated in Parliament.
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