The new Employment Rights Bill is 158 pages long. That sounds enormous – the Employment Rights Act 1996, which contained pretty much the whole of individual employment law apart from discrimination provisions, was only 210 pages. At this stage, We’ve only reviewed the Bill superficially. There’s a lot that will be given flesh on the bones by statutory instruments, which we don’t yet have.
This note addresses some of the highlights, and we’re only going to talk about individual employment rights. We don’t know the commencement date for any of this new legislation. The BBC said that it’s likely to be October 2026 – that’s two full years away .
What’s in the Bill?
1. Unfair Dismissal as a ‘Right from Day One’ policy
Currently, with a few exceptions like whistleblowing dismissals, and discriminatory dismissals, an employee cannot claim unfair dismissal until they have two years of service.
Under the Employment Rights Bill, clause 19, this qualifying period will be removed. Employees will have the right to claim unfair dismissal from day one, as long as they’ve started work. They won’t be able to claim if a signed contract is withdrawn before the start date. There is to be a consultation on a new statutory probationary period. We all expected this to be a six-month period but recent rumours suggest the government favours a nine-month period.
What should you do now? Well, not much, given we’re not expecting this to come into force for two years. But in due course, there will need to be much more careful monitoring of people during probationary periods, and no kicking the can down the road if they turn out to be unsatisfactory hires.
2. Ending Fire and Rehire
This is really important. The Employment Rights Bill, at clause 22, will make it automatically unfair to dismiss an employee for refusing a contract variation. That’s the headline. In more detail, any dismissal will be automatically unfair (and remember there will be no two years qualifying period once this comes into force) if the principal reason for dismissal is either that the employee refused to agree to a variation of contract sought by the employer, or to enable the employer to recruit another person (or rehire the employee) under new terms but with substantially the same duties.
3. Ending ‘exploitive’ zero hours contracts
The new laws in the Employment Rights Bill are really, really complicated, and we haven’t had time to get to grips with them properly. The bill states employers can no longer use zero-hour contracts that exploit or mistreat workers. You must provide them with contracts that reflect regular work patterns. Employers are also obliged to give reasonable notice and compensation for any shift changes or cancellations these workers face. We will give you more detail as soon as we have them.
4. Protection from Sexual Harassment
Employers have a duty to take reasonable steps to prevent sexual harassment (that’s harassment involving conduct of a sexual nature). Until 26th October, employers are not liable for third party harassment. From 26th October 2024, the Equality and Humas Rights Commission (EHRC) can enforce a slightly abstract duty on employers to take reasonable steps to prevent third party harassment, but the employee who suffers third party harassment cannot, themselves, sue.
The level of expectation of what an employer is supposed to do will be raised, including carrying out risk assessments, having policies, having clear processes for reporting and handling complaints.
Consider where your organisation is now. Do you have clear policies? Are all employees aware of them? Do manager / supervisors understand their role in handling complaints? Have you undertaken a risk assessment to consider potential areas where Sexual Harassment could take place? These are all steps to be taking now, in light of the general new duty which applies from 26th October 2024.
5. Flexible working
Currently, employees can request changes to their working arrangements (i.e. flexible working) up to twice a year. Employers must deal with these requests in a ‘reasonable manner’ and can refuse the request for one or more of eight reasons (e.g. extra costs, not able to meet customer demand).
The Government said they will “change the law to make flexible working the default for all, unless the employer can prove it’s unreasonable”. The detail of the proposed legislation seems to indicate that the employer only needs to state the grounds of refusing the application and explain why they consider it reasonable to refuse the application on one or more of the grounds that already exist (things like the burden of additional costs or the inability to recruit additional staff).
So it’s not much of a change; employers just need to give clearer reasons. There’s certainly no ‘right to demand a four-day week’ as some newspapers were suggesting.
6. Paternity, Parental and Bereavement Leave
A few years ago, we had the introduction of Parental Bereavement Leave which received cross party support but there is currently no entitlement for anyone else who has been bereaved. Many businesses offer this either as a stated policy or an ad-hoc customary practice. Parental Leave allows an employee up to 18 weeks’ leave up to their child’s 18th birthday. It is unpaid and is used very rarely. Paternity Leave gives an employee whose partner is having a baby two weeks’ leave.
Under the new law, Paternity Leave and Paternity Leave will be Day One rights. Bereavement Leave seems to be extended to anyone who is bereaved although the detail of the relationship that the employee must have had with the deceased isn’t clear. Bereavement Leave in the circumstances of losing a child will remain at two weeks, other Bereavement Leave is to be one week.
7. Enhanced protection for pregnancy and new mothers
There are protections against dismissal of employees on maternity leave or dismissal for reasons relating to pregnancy, but at present there is minimal specific protection for new mothers. The Bill contains proposals to strengthen protections for pregnant employees and returning mothers. Timescales for new mother protection are not set out, but many expect this to be for six months after a return to work.
We’ll need to await consultation for more detail.
8. Statutory Sick Pay
Statutory sick pay will be paid from first day of sickness (it’s currently three days waiting and payment from day four). Also, the lower earnings threshold for SSP will be removed. The Secretary of State will set SSP as a percentage of pay.
9. Gender Pay Gap / Menopause:
The Bill contains increased obligations (for employers with over 250 employees) to have action plans on gender pay reporting and supporting employees going through the menopause.
10. Collective Redundancy Consultation
Remember the Woolworths case? It considered whether the obligation to collectively consult on redundancies is triggered when 20 or more employees are dismissed across an entire business or at individual establishments.
The European Court of Justice ruled that the requirement for collective consultation applies when an employer proposes 20 or more redundancies within 90 days at one establishment, not across the entire undertaking. That meant that each Woolworths store could be considered a separate establishment, meaning collective consultation was not required for stores with fewer than 20 redundancies. Clause 23 of the Employment Rights Bill reverses this. It means that when deciding whether there are 20 or more proposed redundancies, the number of redundancies across the whole business should be totted up, and separate shops/establishments should not be treated separately.
This is also important as collective redundancy obligations can be quite onerous for employers, but they provide important safeguards for employees. These safeguards will now get better as this loophole will be closed.
11. Written Statement of Particulars of Employment
Clause 45 provides that s1 statements will, once the Bill is enacted and comes into force, have to include a written statement that the worker has the right to join a trade union. The exact details of what needs to be included will come later, in a statutory instrument