Employment Rights Bill 2024

Employment Rights Bill

The Employment Rights Bill, introduced in the UK in October 2024, marks a significant overhaul of labour laws, focusing on enhancing worker protections and promoting fair employment practices. Labour wanted to address the long-standing issues in the UK's employment landscape and align worker protections with modern economic and social realities. The key reforms include:

1. Day-One Rights

   Employees will have enhanced rights from their first day of employment, including protection from unfair dismissal, parental leave, and bereavement leave. Previously, unfair dismissal protection required a two-year qualifying period. Employees will now be able to claim unfair dismissal from their first day of work, instead of having to complete two years of service. However, employers will be able to use a statutory probation period (likely up to nine months) to assess employees, during which these rights might not apply.

2. Probation Period

   A new statutory probation period of nine months will be introduced, allowing employers to assess employee suitability while still ensuring worker protections. The proposed length for this statutory probation period is up to nine months, during which employers can more easily terminate employment if the employee is not a good fit​. During this probation period, the usual protections against unfair dismissal may be adjusted, allowing businesses to make fair decisions on whether to retain an employee based on their performance. However, this aspect of the bill has sparked debate, with some trade unions pushing for a shorter probation period, and the government planning further consultations to finalise the details.

3. Zero-Hours Contracts

   The bill aims to end exploitative zero-hours contracts. Workers on these contracts will have the right to guaranteed working hours if they have worked regular hours for a certain period. Key points often included in discussions about regulating zero-hour contracts are:

   1. Right to Request a Minimum Number of Hours: Workers may have the right to ask for a guaranteed number of hours to provide more stability.

   2. Protection Against Dismissal: Provisions may be introduced to protect workers from being unfairly dismissed or penalized for not accepting available work.

   3. Transparency Requirements: Employers could be required to provide clearer information about the terms of employment and any expectations around work availability.

   4. Fair Pay and Conditions: Ensuring that workers on zero-hour contracts receive fair pay and working conditions comparable to those in more traditional employment setups.

4. Stronger Sick Pay

   Statutory sick pay will be available from day one of illness, removing the previous three-day waiting period, which is crucial for lower-paid workers. Key elements will include: 

   1. Statutory Sick Pay (SSP) Eligibility: Expanding eligibility for SSP to cover more workers, including those on zero-hour contracts or part-time roles, ensuring that more people can access financial support when unwell.

   2. Increased SSP Rates: Proposals to raise the rate of SSP to better reflect living costs, providing adequate financial support during illness.

   3. Extended Duration of Sick Pay: Potentially lengthening the period during which workers can receive sick pay, allowing for longer recovery times without financial strain.

   4. Protection Against Dismissal: Strengthening protections for employees who take sick leave, ensuring they cannot be unfairly dismissed or penalized for their absence due to health issues.

   5. Encouraging Employer Responsibility: Encouraging or mandating employers to offer enhanced sick pay beyond the statutory minimum, promoting a culture of support for employee health.

5. End of Fire and Rehire

   The bill bans the controversial practice of "fire and rehire," where employers dismiss workers only to rehire them on less favorable terms. key things include:

   1. Prohibition of Fire and Rehire: Banning the practice outright or severely restricting its use, ensuring that employers cannot dismiss employees simply to rehire them with different, often worse, conditions.

   2. Consultation Requirements: Mandating that employers engage in meaningful consultations with employees or unions before making significant changes to contracts, including any potential dismissal and rehire scenarios.

   3. Improved Protection for Workers: Strengthening legal protections for employees who might be facing dismissal due to changes in their terms of employment, ensuring they have recourse to challenge unfair practices.

   4. Clarity in Terms of Employment: Ensuring that any changes to employment contracts are clearly communicated and that workers understand their rights regarding changes in terms and conditions.

   5. Support for Workers Seeking Redress: Enhancing mechanisms for workers to report and seek redress for unfair dismissal or changes to their employment terms.

6. Flexible Working

   Flexible working arrangements will become the default unless impractical, supporting work-life balance for employees. Which include: 

   1. Right to Request Flexible Working: Expanding the legal right for employees to request flexible working arrangements, allowing for more tailored work hours, remote work, or part-time options.

   2. Streamlined Process: Simplifying the process for making requests, ensuring that employees can easily submit their needs and receive timely responses from employers.

   3. Increased Transparency: Requiring employers to provide clear reasons for any refusal of flexible working requests, helping to ensure that decisions are fair and justifiable.

   4. Protection Against Retaliation: Strengthening protections for employees who request flexible working, preventing any negative repercussions or discrimination for making such requests.

   5. Support for Employers: Providing resources or guidance to employers on implementing flexible working arrangements effectively, balancing business needs with employee wellbeing.

7. Gender Equality

   Large employers will be required to publish annual gender equality action plans, focusing on closing the gender pay gap and supporting women going through menopause​. Key aspects will include:

   1. Equal Pay Transparency: Measures to enhance transparency around pay structures, making it easier to identify and address gender pay gaps within organisations.

   2. Parental Leave Improvements: Enhancements to parental leave policies, such as extending leave and ensuring that both parents have equal rights and opportunities to take leave, promoting shared parenting responsibilities.

   3. Protection Against Discrimination: Strengthening protections for employees facing discrimination based on gender, ensuring that employers cannot unfairly treat employees due to their gender or related issues.

   4. Support for Reporting: Creating mechanisms for employees to report instances of gender discrimination or harassment more easily, ensuring swift and appropriate responses from employers.

   5. Promotion of Flexible Working: Encouraging flexible working arrangements, which can support gender equality by allowing for better work-life balance, particularly for caregivers, who are often women.

   6. Training and Awareness: Mandating training for employers and staff on gender equality issues to foster a more inclusive workplace culture.

This bill is set to reshape the employment landscape, offering workers more security and ensuring employers uphold fair labour practices. The bill is expected to undergo further consultations and amendments as part of the legislative process. Full implementation of certain provisions, such as the statutory probation period and changes to sick pay and parental leave, is anticipated by autumn 2026, following additional consultations and the finalisation of specific regulations​. However, the timeline could shift depending on parliamentary discussions and any adjustments to the bill.

What is controversial about The Employment Rights Bill?

The UK Employment Rights Bill 2024 has sparked controversy for a variety of reasons, particularly regarding its potential impact on businesses and workers. Here are some of the key areas of contention:

1. Statutory Probation Period

   The introduction of a nine-month probation period for new hires is seen as potentially burdensome for both workers and employers. Workers may feel vulnerable, as it gives employers extended time to assess suitability, possibly leading to uncertainty about long-term job security​. Unions have voiced concerns that this could undermine the benefits of the day-one rights, as employers might use the probationary period to delay granting full employment protections​.

2. Zero-Hours Contracts 

   While the bill seeks to curb exploitative zero-hours contracts, allowing workers to demand guaranteed hours after working regular patterns for a set period, critics argue that this doesn’t fully eliminate the instability that such contracts create. Employers have raised concerns that this requirement could reduce flexibility and increase administrative burdens, particularly in industries that rely on temporary or seasonal workers​

3. Impact on Business Flexibility

   The reforms, particularly around "fire and rehire" and flexible working, have drawn criticism from businesses concerned about the potential reduction in operational flexibility. The end of "fire and rehire" practices, while aimed at protecting workers from unfair treatment, could limit employers’ ability to adjust terms and conditions in response to economic changes​

4. Sick Pay and Parental Leave

   The strengthening of statutory sick pay and parental leave rights from day one has been welcomed by labour advocates but criticised by some businesses as costly and difficult to implement, especially for small and medium-sized enterprises (SMEs). Employers argue that these provisions may lead to increased costs and administrative challenges​

5. Gender Pay Reporting

   The requirement for large employers to publish annual gender equality action plans has been praised for promoting inclusivity, but critics say it adds another regulatory burden. Some business groups feel that the focus on gender-specific issues, such as support for employees going through menopause, might be difficult to implement uniformly across different sectors​

Overall, while the bill is seen as a major step forward in improving worker rights, it has faced criticism from both business leaders and labour groups for either going too far or not far enough in addressing workplace inequalities.