New Labour Government – What’s in store for Employment Law?

As our new Prime Minister Keir Starmer settles into Downing Street, we reflect on the proposed changes that the new Labour Government plan to initiate. In this article we explore the key policy statements and pledges relating to employment law that featured in the Labour Party’s Manifesto.

These are the main policies / proposed changes that have been set out so far:

• Zero Hour Contracts – The new Government propose to ban “exploitative” zero hours contracts and ensure that workers have the option for their contracts to reflect the number of hours that are regularly worked based on a 12-week reference period. Employers will still be able to offer fixed-term and flexible contracts.
• Fire and Re-hire – Labour intends to restrict the practice of dismissing and then rehiring employees under new, often less favourable, contractual terms. The recently updated Code of Practice on Dismissal and Re-engagement was due to come into effect on 18 July 2024, however due to the change in government it is expected that Labour will replace this, although further details are currently unknown.
• Day One Rights – Employment rights such as parental leave, sick pay and unfair dismissal rights are planned to be introduced from day one of employment. In respect of unfair dismissal rights, Labour have made clear that although the current two-year qualifying period will be removed, it is expected that the use of probationary periods will be permitted (subject to fair and transparent rules and processes).
• Minimum Wage – Changes to minimum wage are expected as Labour plans to make minimum wage a genuine living wage ensuring all adults are entitled to the same minimum wage regardless of age by removing the current age bands.
• Equal Pay – Labour have also committed to strengthening working women’s rights to equal pay and taking action to reduce the gender pay gap. This protection will be extended to pay gaps due to race or disability.
• Discrimination and Harassment – Working women’s protections from maternity and menopause discrimination and sexual harassment are expected to be strengthened as part of Labour’s proposals. A duty on employers may be imposed to take all reasonable steps to prevent sexual harassment, including harassment by third parties. Additionally, Labour proposes to introduce enhanced protections against dual discrimination.
• Redundancy – As part of Labour’s proposals to improve redundancy protections and rights they will ensure that the right to redundancy consultation is determined by the number of people impacted across the business rather than in one workplace. This would reverse the existing case law and is likely to mean that collective consultation will be required in more situations.  Labour has not confirmed whether it will also amend the number of redundancies that would trigger collective consultation requirements which currently stands at 20 employees within a period of 90 days.
• TUPE – Labour suggested it will strengthen the rights and protections for workers transferred under TUPE, although it is not clear at this point how they intend to do this.

While some of these proposals may shortly become law, many are still being consulted on.

Labour’s New Deal green paper also comprises other proposals and intentions, these include;

1. Increase the time limit for bringing employment tribunal claims to six months from three months.
2. Provide that the written statement of particulars must inform staff of their right to join a trade union and to inform staff of this regularly.
3. Introduce a right to bereavement leave for all workers and the possibility of paid carers’ leave.
4. Permit collective grievances to be raised to ACAS.
5. Ban unpaid internships except when they are part of an education or training course.

Labour has suggested it plans to introduce legislation within 100 days and intends to consult with select employers and trade unions before secondary legislation is passed. They have acknowledged that some proposals will take longer to review and implement than others.

We expect transitional arrangements will be put in place to allow employers time to prepare for the new changes but without more details of the proposals and with the uncertainty of timings, it is too early for businesses to do much by way of meaningful preparation. We will continually monitor the proposals and provide updates when further information becomes available.

It is important to understand the changes on the horizon and our experts at Backhouse are here to help. If you need legal advice once these changes come in, please call us and book a free, 30-minute consultation with one of our specialist employment law solicitors.

Tel:          01245 893400
Email:     info@backhouse-solicitors.co.uk
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