Labour’s ‘once in a generation’ reforms to workers’ rights could take years to kick in, and will not all be introduced at once, reports suggest.
The government has said it will publish the draft Employment Rights Bill within 100 days of coming into power, and this is widely expected to be on Thursday this week (10 October).
This weekend, officials have suggested that it could take more than a year to bring some of the key measures into effect, meaning it could be a year to 18 months before they are applied in the workplace.
According to a report in The Times, a number of manifesto pledges have already been postponed until later in parliament, including giving staff a formal “right to switch off”, and creating a single status of worker in order to simplify the tax and legal systems and challenge bogus self-employment.
Instead, ministers are likely to encourage companies to draw up codes of conduct about contacting employees outside of working hours, rather than giving employees statutory rights as is the case in some countries.
And while employees will gain a universal right to claim sick pay from the first rather than the fourth day of illness, Labour could introduce a lower statutory sick pay rate for those who earn below the current threshold to qualify for sick pay of £123 a week, The Times suggested.
Employment Rights Bill
Delays to the formal introduction of legislation are likely to come from negotiations with business groups and unions on the details of the Bill, and some elements of the government’s manifesto promises could be left to secondary legislation some years into this parliament.
One business group leader told the Financial Times: “I don’t think we’ll be seeing a lot of this before 2026. There is a sense of ‘let’s get this right first time’… The mood is to use secondary legislation on anything contentious to give time for consultation.”
One reform that could be implemented more quickly is the repeal of anti-trade union legislation, where government departments have already been ordered to ignore minimum service level rules.
Strengthened protections for pregnant workers and clarifying a right to bereavement leave may also be introduced sooner rather than later.
Complex reforms
More complex areas might include designing a new statutory probation period within new day-one rights to maternity, sick pay and unfair dismissal protection. Previous reports have suggested this could be a maximum of six months, but this will be up for negotiation with business leaders and unions.
Ministers will also have to consult extensively on plans to ban “exploitative” zero-hours contracts, with business lobby groups concerned that a rigid ban on casual employment arrangements could stifle operations.
Neil Carberry, chief executive of the Recruitment and Employment Confederation, said meetings with the Department for Business and Trade had been positive so far. He expects the draft on Thursday to be “extremely enabling” in that it will give powers to make regulations in key areas but will allow departments to consult with stakeholders.
“The big things likely to affect business are day-one rights, zero-hours contracts and employee status,” he said. “It’s not ideal, but Labour committed to delivering in 100 days, so we’d rather something we’re happy with than something that would be harder to unpick.
“The plan to Make Work Pay is enormous, so it’s important to understand how we make it practical for businesses and the timetable for delivery. We also need clarity on the levels of consultation that will happen, as the last thing we want is to lock people out of the labour market.”
Bosses in seasonal industries, for example, are worried that proposals for an entitlement to a contract that reflects regular hours worked could be problematic.
Thursday’s draft bill is therefore likely to represent a broad framework of what will be delivered in the following months, but HR teams may not be dealing with the reforms ‘on the ground’ until 2025 or even 2026.
The government will also want the Bill to hit a positive note with both employers and working people in advance of this month’s budget on 30 October.
Chancellor Rachel Reeves has already ruled out hikes to income tax and employee national insurance contributions, but we could see employers paying higher NI contributions or employer pension contributions attracting NI charges.
TUC general secretary Paul Nowak said: “The Employment Rights Bill – if delivered in full – will make work better for millions of working people. Driving up employment standards is in everybody’s interests.
“Establishing a level playing field on workers’ rights will stop good employers from being undercut by the bad. Increasing job security is good for workers and business. Treating staff well boosts productivity and living standards.”
Molly Johnson-Jones, co-founder and CEO of flexible jobs board Flexa, said that “top-down” legislation would not be the answer.
“Employers should be able to choose the working environment, benefits and policies that suit the needs of their businesses and staff, and be transparent about what they offer,” she said.
“This way, workers can find employers with working setups that truly suit their needs, and employers can attract and retain people who thrive in their specific work culture.”
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