Employment rights are being overhauled and LAURIE ANDERSON outlines what employers need to know
From an overhaul of zero hours contracts to ‘Day One employment rights’, a swathe of significant changes to employment rights in the UK is expected to be rolled out within 100 days of the new Government’s election through their “New Deal for Working People”.
The intended changes are wide-ranging and could be highly impactful to businesses across the country – and employers and employees alike should make sure they’re fully informed about what’s on the horizon.
Below is a summary of the principal changes affecting employers, with the caveat that some of these may be subject to alteration as implementation gets under way.
Day One employment rights
- Many significant employment rights are presently subject to minimum service requirements and the Government has indicated an intention to scrap these service requirements and include these as Day One rights, including sick pay, parental leave and the right to raise claims for unfair dismissal
- Of particular concern to employers will be the proposed removal of the two-year service requirement to raise unfair dismissal proceedings, which has historically given employers protection against unfair dismissal claims. What has not been made clear by Labour is how this will interact with probationary periods or if this will be applicable to fixed term contracts. We will be studying carefully any guidance provided in this regard.
- This uncertainty, may, in the short term, counteract Labour’s intention as it is possible that some employers may decide to terminate short-serving employees before these new rights are enacted. Employers should seek advice as to how best to approach these changes
Probationary Periods
- As mentioned above, the intention to scrap the minimum service requirements for employees will inevitably converge with the Government’s further plans to increase fairness and transparency of probationary periods
- The Government seemingly intends to introduce rules regarding probationary periods (ie length of probation and dismissal procedures) but we don’t yet have any details on how these will be implemented, or if there will be consideration of employers’ need for flexibility in the early stages of employment
- It will be essential for employers to comply with these new rules, and advice should be sought as to the implementation of these once more detail is provided by the Government
Zero Hours Contracts
- Zero hours contracts are much maligned in the press as being exploitative of workers and abused by employers to ensure they have a steady stream of ‘on-tap’ staff with no requirement to provide them with work
- Labour initially planned to outlaw zero hours contracts entirely but have now rowed back on that. Zero hours contracts will remain, however minimum standards for zero hours contracts will be implemented
- Employers should take appropriate advice to ensure that their zero hours contracts are compliant
End to fire and rehire
- Fire and rehire has been subject to significant scrutiny in recent times, with companies such as P&O receiving negative press for using this tactic to dismiss around 900 employees in 2022
- However, it has been a staple of UK employment law to assist employers where there is intransigence by employees and a necessity to change terms and conditions
- The previous government implemented a new ACAS Code of Practice on Dismissal and Re-Engagement, potentially increasing Tribunal awards against employers for non-compliance
- The new Government plans to go even further and do away entirely with fire and rehire, introducing instead a new code of practice in this area
- Employers must seek advice to ensure that their policies and procedures are compliant with any new code of practice
Laurie Anderson is a senior associate in Aberdein Considine’s Employment Team
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