Mandy Armstrong
- Director
Insights | Employment
The Employment Rights Bill is here – what you need to know
11 October 2024
The long-awaited Employment Rights Bill has officially been published, marking the beginning of what promises to be a transformative era in UK employment law. But what does this mean for workers, employers, and anyone with a vested interest in workplace rights? This is one of the most significant updates in employment law we’ve seen in decades, and yes, it’s time to get excited – or at least, get prepared.
The Labour government, which came into power on July 4, 2024, promised major reforms within their first 100 days in office. Labour’s intentions had been set out in their Plan to Make Work Pay, but we now have a clearer picture of the changes ahead—though, we’ll likely have to wait a bit longer for some of the finer details.
In conjunction with the Bill, the government also published a policy paper titled, ‘Next Steps to Make Work Pay’, which sets out plans for reforms that can be enacted using existing powers. Such reforms are not included in the Bill but will be implemented alongside those that are.
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Introduction of day-one rights
One of the most impactful changes proposed in the Bill is the extension of employment rights from the first day of work, rather than after the traditional two-year qualifying period. From day one, workers will be entitled to protection from unfair dismissal, as well as parental leave and sick pay.
However, the Bill introduces a probationary period framework, allowing for some flexibility during the initial phase of employment. The specifics of these probationary periods—such as their duration and how they will interact with day-one rights—are yet to be confirmed. Employers should begin to consider how this shift will affect workforce planning and employee management, particularly given the potential for an increase in employment tribunal claims.
This could mean more tribunal claims, a heavier reliance on probationary periods, and could potentially prompt employers into tidying up any “problem” members of staff before the new law takes full effect.
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Zero-hour contracts under scrutiny
The Bill also introduces new measures aimed at curbing ‘exploitative’ zero-hour contracts. Rather than an outright ban, the legislation allows employees the right to request a contract that reflects the hours they regularly work, based on a 12-week reference period. This aims to provide greater security and predictability for workers, while maintaining some flexibility for both employees and employers.
For organisations that rely heavily on zero-hour contracts, it would be prudent to assess current employment practices to determine how these changes may affect operations. Resourcing models may need to be adjusted to accommodate the new requirement.
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Stronger protections for new mothers
The Bill also strengthens maternity protections, making it unlawful to dismiss a woman within six months of their return from maternity leave, with a few notable exceptions. This legal tightening reinforces the need to have robust processes in place when managing employees returning from leave.
Exceptions to this rule are expected, such as in cases of business liquidation or site closures, but further details are yet to be outlined.
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Ban on fire and rehire
The controversial practice of “fire and rehire” is officially being phased out. The Bill puts a stop to employers making staff redundant only to rehire them on less favourable terms. The Bill will replace the existing Code of Practice on Dismissal and Re-engagement introduced by the previous government, introducing stricter penalties for employers who fail to meet their consultation obligations.
There will be stronger penalties for employers who breach consultation obligations when altering terms and conditions.
In light of these changes, employers should take the opportunity to review current procedures around redundancy and contract variation to ensure continued compliance.
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Introducing the Fair Work Agency
The Bill also sets the stage for the creation of a new single enforcement body: the “Fair Work Agency.” This body will oversee workplace rights enforcement, working alongside trade unions and businesses to ensure better protection for workers. It will have the authority to inspect workplaces, issue fines, and even bring civil proceedings on behalf of workers.
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A living wage for all adults
The government has fulfilled its pledge to introduce a single living wage, scrapping the age-based tiers of the national minimum wage. All adult workers will now benefit from the same rate. Labour has framed this as a way to end “discriminatory” pay bands, but whether this applies to apprentices and other special categories remains to be seen.
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Right to switch off
One of the more forward-looking proposals set out in the Next Steps Policy Paper is the introduction of a “right to switch off.” This new right will be established via a statutory Code of Practice and will give employees the ability to disconnect from work-related communications outside of their working hours, protecting them from the expectation to be “always on” in an increasingly digital working environment.
The right to switch off acknowledges the growing concern around the impact of technology and remote working on employees’ mental health and work-life balance. It aims to combat issues such as burnout and work-related stress, particularly as remote and hybrid working models have blurred the lines between professional and personal time.
Employers will need to develop clear policies on out-of-hours communication and ensure that employees are not expected to respond to work emails or calls outside their contracted hours. This will require adjustments to management practices and the fostering of a workplace culture that respects employees’ time off.
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Empowering trade unions
The Bill also delivers major changes to the law around trade unions. Labour is making it easier for unions to gain recognition and hold industrial action, with changes to balloting rules and an emphasis on ensuring workers know their rights to join a union. Employers will also need to give unions greater access to the workplace for recruitment and organizing purposes.
This could lead to an uptick in collective bargaining and industrial action, especially for employers who have traditionally avoided union involvement. If you’re in HR, now might be a good time to think about employee engagement and fostering open communication in the workplace.
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What happens next?
Although the government has introduced the Bill within its promised 100-day window, it still has to pass through Parliament before becoming law. And even then, some changes won’t take effect until later, potentially as far off as 2026.
In the meantime, businesses would do well to start preparing now. Stay on top of your workforce management, review contracts, and consider how these reforms will affect your recruitment, retention, and workplace policies. Being proactive will put you in the best position to handle these changes smoothly.
Final thoughts
The publication of the Employment Rights Bill is a landmark moment for employment law in the UK. With sweeping changes in workers’ rights, maternity protections, trade unions, and more, we’re entering a new chapter that will affect employees and employers alike.
So, if you haven’t already, it’s time to get familiar with the details of this Bill—and to start planning for the future of your workplace. Change is on the horizon, and staying informed and flexible is the best way to navigate the road ahead.
For any further guidance and support, please get in touch with Mandy.Armstrong@andersonstrathern.co.uk.