UK ministers have unveiled an employment rights bill they say will represent the biggest upgrade to worker protections in a generation. The legislation is intended to redress the balance in a labour market where workers often have less protection than in comparable European economies. The government argues its reforms will be “both pro-worker and pro-business”, but employers — while relieved that most changes will take at least two years to put into effect — remain deeply uneasy.
What does the bill achieve? Among a swath of measures, four key provisions represent a “sea change” from current practice, according to Caspar Glyn, chair of the Employment Lawyers Association. Protection against unfair dismissal from the first day in a job — scrapping a current two-year qualifying period — means that millions of workers will be better protected when they move to a new employer, even though employers will be able to follow a “less onerous” process when dismissing someone still on probation. Employers will be held to a tougher test in future if they reject a request to work flexibly — with the onus on them to prove their refusal is “reasonable”.
Workers with few or no guaranteed hours will gain a right to move to a contract that reflects their regular working pattern — albeit one where the details are fraught with difficulty and still need to be hammered out. And businesses will find it much harder in future to change their employees’ terms and conditions, under provisions that will mean they can use “fire and rehire” tactics only to avert an “immediate” risk of going bust. “There is no doubt that employees will get more rights. There is no doubt that the new rights will cost businesses more,” Glyn said.
Who will benefit? These key provisions will affect millions of UK workers. More than a third of employees have been in their job for under two years and stand to gain new protection against unfair dismissal. More than one million work on zero-hour contracts, with many more working on insecure terms with few guaranteed hours and an unpredictable income. Nye Cominetti, principal economist at the Resolution Foundation think-tank, said the bill was “a major step forwards in the working conditions of low earners”, and made Britain “look more normal compared to our peers”.
New parents, the newly bereaved and low earners who win new rights to statutory sick pay are among those who will benefit from other specific provisions in the bill. And all workers should in theory benefit from better enforcement of their rights by a new Fair Work Agency. However, among the biggest winners are the UK’s trade unions. The bill repeals previous anti-union legislation and meets many of the union movement’s main demands. Although details have yet to be spelt out, there will be new rights for unions to access workplaces, and the launch of sectoral collective bargaining in adult social care, as well as for school support workers.
A union could in future win the right to negotiate pay and conditions with an employer if just 2 per cent of staff are members, rather than 10 per cent at present. “It’s a pretty substantial commitment,” said Kate Bell, assistant general secretary of the Trades Union Congress.
What are the concerns? The package has received a sceptical reaction from business groups. They are relieved that most of the bill’s provisions will be subject to lengthy consultation, but say the new rules will make it riskier and more expensive to hire, and could backfire on workers. Jane Gratton, deputy director of public policy at the British Chambers of Commerce, said the reforms had the potential “to get more people into work and boost economic growth” but that “if the process is mishandled, there is a danger these changes could have the opposite effect”.
A concern shared by both businesses and unions is that employers may find ways to circumvent the new rules — for example, by hiring temps or self-employed contractors. This meant it was “crucial” for the government to press ahead with a key reform that is not in the bill — redefining workers’ status to draw a clear boundary between employment and self-employment, Bell said.
What has still to be decided? Much of the detail of key reforms will be set out in secondary legislation — in particular, the process for dismissing workers during probation, the mechanism to set workers’ guaranteed contractual hours, and the means for trade unions to gain physical and digital access to workplaces.
And despite the bill’s broad scope, it encompasses just 28 measures out of more than 75 set out before the election in Labour’s Plan to Make Work Pay. Some of the other measures do not require legislation, or will be included in other bills, but others require longer consultation. Neil Carberry, chief executive at the Recruitment & Employment Confederation, said businesses were relieved that the government had given “a sense of direction” but that all the most important decisions remained to be taken. He added: “The real stuff is still to come . . . all the really big flashpoints are still to be navigated.”
