A “New Deal for Working People” is one of the key pledges of the new Labour government, so what employment law changes could be on the way? In this article, I highlight how the new rules could soon impact employers…
Day one employment rights
Labour wants new employees to benefit from key rights from their first day of employment. This will remove a minimum level of service threshold for unfair dismissal, parental leave and sick pay. Flexible working requests will also be accepted, unless the employer can prove that it is not feasible.
These new rules will remove the two-year minimum service period for unfair dismissal claims, along with the compensation cap of £115,115 or one year’s pay. Employers must dismiss workers “fairly” due to capability, conduct or redundancy reasons, or in probationary periods using fair and transparent procedures.
Personally, I predict that many employers will consider making dismissals before the proposals become law as it is quicker and cheaper to remove employees under the current rules.
Employment tribunal claims
Labour wants to increase the threshold for bringing an employment tribunal claim from three to six months. While this will benefit workers, it will have serious implications for employers and the tribunal system. Businesses will incur increased costs to adopt the new changes and it will put even more pressure on a creaking tribunal system that is in urgent need of investment.
Right to disconnect
Copying rules adopted in Ireland and Belgium, Labour’s New Deal highlights a new “right to switch off” that allows staff to disconnect from work outside of working hours when they cannot be contacted by their employer.
This will be an interesting one to watch as many sectors in the UK have developed a 24/7 culture. The new government wants employers and employees to agree on policies and contract terms, so I recommend businesses adopt a code covering practical arrangements surrounding out-of-hours work (e.g. urgent emails, emergency calls and weekend cover).
Reform ‘fire and rehire’
To prevent abuse by unscrupulous employers, the previous Conservative government introduced a new statutory Acas Code of Practice for Dismissal and Re-Engagement, due to go live on 18 July 2024. Failure to comply could mean a 25% increase in tribunal awards against an employer, while a failure to meet collective consultation obligations could mean an even bigger penalty.
The new Labour government wants stricter rules outlawing the practice of “fire and rehire” completely. A stronger code of practice could include better consultation procedures and changing unfair dismissal and redundancy laws to stop employees from being dismissed for failing to accept an inferior contract.
Zero-hours contracts
There was talk of the Labour administration wanting to ban zero-hours contracts outright, but they appear to have mellowed and now only want to target “exploitative” arrangements. Employers can keep zero-hours contracts if they can prove workers are not “abused”. For example, a restaurant owner does not guarantee work, but expects waiting staff to be available when work is offered.
New rules will lay out minimum standards, with employees having the right to a contract that reflects common working hours (over a 12-week period). I recommend that businesses review their zero-hours contracts to ensure they are compliant.
Whistleblowing
During the election campaign, Labour pledged to improve protection for whistleblowers, including women reporting sexual harassment in the workplace. Reforms planned by the previous government are already in the pipeline for October 2024, so watch this space for further developments.
Pregnancy
Employment law changes will make it unlawful for employers to dismiss women for up to six months after they return to work from maternity leave (exemptions for specific circumstances). The law around pregnancy is already very strict, but this measure means enhanced protection from redundancy.
Need advice on the employment law changes?
If they go ahead, the plans by Labour will cause a major shift in the employer-employee relationship. I recommend that employers review their existing HR policies and procedures to ensure they remain compliant when the proposed employment law changes become law. In particular, recruitment procedures and paperwork need to reflect the new level of rights given to workers on day one of their employment.
I would also recommend holding formal monitoring and feedback sessions during probationary periods so employee performance can be documented.
People problems are never straightforward, so businesses should seek professional advice. JT HRConsultancy is an established HR services company based in Bedfordshire with clients across the UK. If you need help of advice on an employment issue, call me on 07715 026128 or email jo@jt-hrconsultancy.com
