The recent announcement of the Employment Rights Bill on Thursday, 10 October, has set the stage for significant shifts in UK employment law. As a business owner or manager, it's crucial to understand these changes and their potential impact on your operations.
Our HR experts at Ashgates have thoroughly reviewed the 158-page document, and we're here to provide you with a comprehensive breakdown of the key changes and their implications for your business.
Implementation Timeline and Scope
While many specifics are yet to be confirmed, current speculation suggests an October 2026 implementation date. However, this remains unconfirmed by the Government. Some initiatives may extend beyond the next election, and it's worth noting that several manifesto promises are absent from the bill.
13 Critical Updates for UK Businesses
- Day 1 Unfair Dismissal Rights: The 2-year qualifying period for unfair dismissal claims has been eliminated, affecting an estimated 9 million UK employees. This change emphasises the need for robust recruitment and fair dismissal procedures from day one of employment.
- Statutory Sick Pay (SSP) Changes: SSP will now be payable from the first day of absence, potentially leading to increased short-term absences. This could pose a significant financial burden, especially for SMEs.
- Flexible Working Updates: While changes are minor, employers will need to provide clearer reasons for rejecting flexible working requests. Compensation of up to 8 weeks' pay may be awarded for breaches.
- Fire and Rehire Restrictions: Dismissing an employee for refusing a contract variation will be automatically unfair, with limited exceptions for businesses facing closure due to financial issues.
- Zero Hours Contract Reforms: New provisions include guaranteed hours, reasonable notice rights, and compensation for short-notice shift cancellations. These changes also apply to minimum-hour contracts.
- Redundancy Consultation Changes: Collective consultation obligations will apply when 20 or more employees across the entire business are affected, not just at individual sites.
- Sexual Harassment Whistleblowing: Sexual harassment will be protected under Whistleblowing legislation, increasing employer responsibilities and potential tribunal costs.
- Enhanced Harassment Protection: Employers will have a duty to take reasonable steps to prevent third-party harassment, reverting to earlier Equality Act standards.
- Gender Pay Gap and Menopause Support: Businesses with 250+ employees may need to produce equality action plans and provide support for menopausal employees.
- Trade Union Rights in Employment Contracts: Written statements of particulars must include information on the right to join a trade union.
- Enhanced Maternity Protection: Stronger protections for pregnant employees and new mothers returning to work are proposed, with details pending further consultation.
- Bereavement Leave: A statutory right to bereavement leave will be introduced, although relationship specifics are not yet defined.
- New Enforcement Agency: A government body will be created to pursue employers who fail to comply with employment legislation.
What's Missing?
Some pledges from the Labour Manifesto are notably absent from the current bill, including:
- A right to switch off
- Reporting requirements on ethnicity and disability pay gaps for large employers
- A simplified employment status system
These may be addressed in future legislation or by subsequent governments.
Stay Informed
As these changes unfold, it's crucial to stay updated and prepare your business accordingly. We'll continue to monitor developments and provide timely updates to help you navigate these significant shifts in employment law.
For more detailed information and personalised advice, please contact Steve Martin on 01332 380691 to schedule a consultation with our Ashgates HR experts.