Yesterday the government published the draft Employment Rights Bill, just ahead of Labour’s first 100 days in power. Many extensive reforms were anticipated, but the Bill contains watered-down versions of the changes that were expected, and kicks their implementation into the long grass by requiring consultations on the finer details. Some proposed reforms are not integrated into the Bill at all, such as a statutory ‘right to switch off’ outside of normal working hours, which will now be implemented through a Code of Practice. Some changes still require extensive consultation, such as a single ‘worker’ status.
The most drastic of the changes outlined in the new legislation is the right that will be granted to workers to claim unfair dismissal from their first day of working with an employer – currently, only those who have completed two years of service with their employer can claim unfair dismissal. However, employers will still be able to impose probationary periods, which the government has indicated could be nine months long, and it’s not clear what a fair process for dismissal will look like. The Government has said these reforms to unfair dismissal will not come into effect until Autumn 2026, which is in stark contrast to initial Labour party communications suggesting that these rights may be effective immediately.
A further measure is the extension to all workers, regardless of level of earnings, of the right to receive Statutory Sick Pay (which the employer must pay) from their first day of illness. Until now, only those earning above £123 per week are entitled to receive Statutory Sick Pay, and only once they have been ill for three consecutive days. As there is presently no suggestion that the level of SSP (currently £116.75) will be increased, this reform will not represent a significant cost increase for most employers, but nor will it improve the position of employees in any material way.
Another change, effective once the Bill comes into force, is a right to take paternity and parental leave with no minimum period of service with an employer required, although there will be no equivalent change for maternity leave as had been speculated. At present, individuals must be employed for six months to be entitled to paternity leave and pay from their employer, and one year for parental leave. A right to flexible working will also become the default position for all, once the Bill is passed, unless the employer can prove the request is unreasonable.
The Bill sets out an employer’s duty to take “all reasonable steps” to prevent sexual harassment of staff. This widens the prevention duty provisions, already scheduled to come into force on 26 October, which place a duty on the employer to take “reasonable steps” to prevent sexual harassment of staff in the course of their employment. The Bill also states that an employer is deemed to have permitted a third party to have harassed a staff member if it failed to take all reasonable steps to prevent the third party from doing so. This is a high bar for employers to meet.
Of course it is possible that not all of these provisions will survive the passage of the Bill through its various approval stages. The Bill is only at the second reading stage in the House of Commons, and must still pass through the House of Lords and receive Royal Assent before it is passed and the changes become effective. The government has said it expects that the majority of reforms will not take effect until 2026.
Do reach out to a member of the Employment team if you wish to discuss any of these changes further.
