Employment Law Changes with the new Labour Government
After 14 years of a Conservative government, Labour have now taken up residence in Downing Street. Alongside the change in residence, the Labour party’s manifesto outlines several changes that employers need to be aware of, it they are enacted, subject to consultation. These key reforms are set to be introduced within 100 days and span from discrimination law and “Day One Rights” to trade unions and industrial action.
Day One Employment Rights – Key Changes:
- Unfair dismissal, sick pay and parental leave
Currently, an employee must accrue two years of continuous service to a company before they can claim unfair dismissal in an employment tribunal.
Labour’s reform will grant protection of unfair dismissal as well as sick pay and parental leave which will be deemed “Day One Rights”
- Fair Pay
National minimum wage (NMW) rates are presently based on average earnings.
With Labour’s manifesto, existing age bands (allowing payment of a reduced rate) will be scrapped in favour of a flat rate for all age groups.
“Fair Pay Agreements” will be introduced, under which pay rates are determined by sectoral collective bargaining. It is likely that this will be trialled out in the social care sector before this is rolled out to other sectors due to a lack of support in the business community.
- Discrimination Law
Currently, equal pay legislation applies to gender pay disparities to cover disabled and BAME employees. Gender Pay Gap Reporting has been mandatory since 2017.
Key changes in this area will include:
- Implementation of Ethnicity Pay Gap Reporting (for employers with 250+ employees).
- Implementation of Disability Pay Gap Reporting (for employers with 250+ employees).
- Gender Pay Gap Reporting action plans are to be published and are to include outsourced workers. This means that pay gap reporting will be a far larger exercise than it has been historically.
- Sexual harassment will be treated and have similar protections to whistleblowing
- There will be enhanced protection of sexual harassment for interns
- A ban on dismissing returning maternity leavers will be introduced, covering six months after the return to work except in specific circumstances.
- Enforcement
Labour is set to introduce extensions of time limits for tribunal claims from three months to six months. This is due to delays in the current tribunal system.
Labour are proposing to establish a new state body “Fair Work Agency” with the power to inspect workplaces and take legal action where necessary. This will mean documentation and record keeping will become more significant going forward.
- Ending “one-sided” flexibility
Labour are planning to implement a ban on “fire and rehire”. Further movement is expected in this area as Labour openly criticised the recently released Tory statutory Code of Practice as being “inadequate”.
Additionally, zero hour contracts will be banned and there will be a shift in narrative on empowering employees to request contracts that reflect the hours of work undertaken.
- Trade Unions and Industrial Action
Labour will be working to simplify trade union recognition and improve trade union worker access to workplaces. Further, self-employed workers are to enjoy the same improvements to trade union rights as workers.
- Worker Status & Self-Employment
Labour aim to (eventually) abolish:
- The U.K.’s three tier system for employment status
- The distinction between employees and workers – this will need further consultation on the logistics of sick pay, family leave and other policies in these models.
Rights for self-employed people will be written in a contract and will enable self-employed workers to take action on late payments, extend health and safety blacklisting protections to the self-employed. Further clarity and consultation is needed in this area.
If you have any enquiries relating to these potential changes, please get in touch with Nina Francis by email nina.francis@wellerslawgroup.com or by phone on 020 3831 2664.