The Employment Rights Bill – October 2024

The Employment Rights Bill – October 2024

The Employment Rights Bill has been published, subject to the usual Parliamentary processes. There will be a lot of consultation over the details of the secondary legislation required to implement the Bill’s provisions. This will all take time; therefore, the majority of the changes will not take place before 2026.

The full Employment Rights Bill is found here https://commonslibrary.parliament.uk/research-briefings/cbp-10109/

The Bill introduces the biggest changes to employment law in years. However, employers will have plenty of time to prepare for the changes.

Here is an overview of the key areas:
1. Day-one rights
Perhaps the biggest controversial change in the Bill is the introduction of ‘Day one’ rights for employees to claim unfair dismissal. This will mean that it is likely that there will be a statutory probationary period called an ‘initial period of employment’ for new hires, during which time employers will be able to terminate employment without following a full process.
The Government is currently proposing a period of nine months.
The Bill also introduces day one rights to paternity leave, unpaid parental leave and a new statutory (paid) bereavement leave.

2. Right to a stable contract
The government’s manifesto proposed to end “exploitative” zero-hours contracts, the Bill introduces a new right to a guaranteed-hours contract for those who work regular hours over a 12-week reference period, with provision for subsequent reference review periods if hours become regular over a longer period of time. Importantly, workers who want to remain on zero-hours contracts will be able to do so.
The Bill also provides for workers on zero and low hours contracts to be given ‘reasonable notice’ of changes in shifts or working time, with compensation for shifts cancelled or reduced at short notice.

3. Flexible working requests
1st April 2024 saw Flexible Working requests introduced as a day 1 right. The Bill goes even further than this stating that employees will have a ‘strengthened right’ to work on a flexible basis, but it remains a right to request flexible working. Employers will still be able to refuse a flexible working pattern on the specified statutory grounds, provided it notifies the employee of the reasonable refusal grounds.

4. Statutory Sick Pay (SSP)
SSP is set to be changed by removing the current 3 day waiting period and meaning that SSP will be payable from the first day of absence. The existing Lower Earnings Limit (LEL) for qualifying for SSP, currently £123 per week, will also be removed.

5. Protection during pregnancy and after family leave
Pregnant women and new parents will have ‘strengthened protections’ against dismissal, for six months after returning to work from a period of family leave. This will include separate regulations that will prevent dismissals of these employees other than in specific scenarios.

6. Increased Sexual harassment protection
From 26 October 2024 Employers will be required to take ‘all reasonable steps’ to prevent sexual harassment, rather than ‘reasonable steps’ as currently written. Sexual harassment will also be added to the list of protected disclosures, under existing whistleblowing policies.

7. Fire and rehire (dismissing and re-engaging)
The Bill provides for ‘fire and rehire’ to be added to the list of reasons amounting to an ‘automatic’ unfair dismissal, other than in very limited circumstances when a business has no alternative due to financial circumstances.
Also, the Bill amends the existing provisions relating to collective redundancy (affecting 20 or more employees) and the obligation to collectively consult with employees. These provisions will no longer apply to proposed redundancies at ‘one establishment’, meaning that the obligations will potentially be much more onerous for employers seeking to make redundancies over multiple workplaces.

8. Action on gender pay and menopause
Under the Bill, large employers (likely 250+ employees) will be required to produce action plans to address their gender pay gaps and to support employees through the menopause.

9. Fair Pay
The Bill is also set to create a Fair Pay Agreement in the adult social care sector and reinstatement of the School Support Staff Negotiating Body.
The government has separately committed to remove the existing “discriminatory” NMW age bands, and the Low Pay Commission is now required to consider the cost of living when setting the annual NMW rates.

10. Public sector contracts
The Bill reinstates the two-tier code for public sector contracts, with the aim of ensuring that employees working on outsourced contracts are offered terms and conditions no less favourable to those transferred from the public sector.

11. Trade unions
Employers must provide workers with a written statement of their trade union rights along with their statement of employment particulars at day 1 of employment.

12. Fair Work Agency
A new Fair Work Agency will bring together existing enforcement functions (currently provided by the Gangmasters and Labour Abuse Authority, HMRC’s NMW enforcement unit and the Employment Agency Standards Inspectorate) to enforce employment rights and to support employers in compliance.