Major employment law changes ahead

With the new Labour Government, we are about to witness the biggest shake up of employee rights that we have seen in a decade. Here we provide a summary of them, as well as explaining more on unfair dismissal and on a new case relevant to agricultural workers on whether the minimum wage needs to be paid for travel time from home to work and between work sites.

Here is a breakdown of the main changes expected with the new legislation, set to be introduced in October 2024:

1. Right to claim unfair dismissal: Employees can claim unfair dismissal from day one, subject to probationary periods.
2. Extended tribunal claim period: The time limit to bring Employment Tribunal claims will increase from three to six months.
3. Ban on exploitive zero hours contracts: Zero hours contracts that exploit workers will be prohibited.
4. End of fire and rehire practices: Employers will no longer be able to fire employees and rehire them under less favourable terms.
5. Employment status reform: Reforms to employment status to refine and improve definitions and rights.
6. Parental leave and sick pay from day one: Parental leave and sick pay will be available from the first day of employment, subject to probationary periods.
7. Flexible working requests: All workers will be entitled to request flexible working from day one.
8. Updating trade union legislation: Removing restrictions on trade union activity and minimum service levels.

In short, these changes, which the Government is fully committed to, would considerably improve employee rights and protections. This means employers will need to adapt their approach to dealing with employees and trade unions. When precisely each change will happen remains unclear at this stage, however we discuss the potential effect of the most significant change on you or your business below.

Unfair dismissal

One of the most impactful changes is that employees will be able to claim unfair dismissal from the first day of their employment, which currently requires two years of service. This shift could mean employers will need to adhere to stricter procedural standards and have justification when terminating employment, or they risk facing a costly claim.

Plus, with the planned employment status reform of potentially combining the category of employee and worker, this could significantly increase the number of staff that has unfair dismissal protection.

But it is not clear, at the moment, whether an employer would be able to avoid this enhanced unfair dismissal protection through a well worded clause setting out a probationary period. So it may be worth employers considering a review of their contracts now to ensure that there is clear provision about how long probation will be.

Clarifying travel time compensation

Although time travel compensation is not one of the expected changes in October, it could be amended in the future through separate legislation and can impact your business. For you to be aware and plan ahead, we discuss a recent court case involving poultry workers. The case has clarified the legal stance on travel time compensation. The court found that time spent ‘just’ travelling was not “time work” and so there was no entitlement to be paid the minimum wage for that period.

“Time work” is defined as work outside of salaried work, for which a worker must be paid for. Travel time between jobs or business locations can be treated as time work, but, travel between home and their usual place of work, or an assignment, doesn’t qualify.

In this case, the employer provided a minibus that would pick up the workers from their homes (or their business premises) and transport them directly to their first assignment. On top of a normal working day, these journeys could be up to eight hours long. The workers were paid £2.50 per hour over this period. The question was whether the workers were entitled to be paid minimum wage during their travel time.

The case found that time spent travelling to work could not be classed as “working” unless there was work to be done while travelling.

So, there was no entitlement to minimum wage during that time. That was despite the workers having no choice but to travel long distances, if they accepted specific tasks. It also didn’t matter that the travel was not an ordinary commute.

While it may have been regarded as unfair, that was the law and it would take Parliament to change that, not the courts.

We will share further updates as more becomes clear, and if you would like more information or support for your unique situation, please get in touch with Robin Turnbull or your regular Anderson Strathern contact.

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