All Change! Labour Government – What Should Employers Be Doing Now?
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U.K.’s New Government – what can be expected on the labour front !
“It’s time for change” was Labour’s message in the run up to the election and “Action, not words” the message after it, so now the Labour Party is in power, what might this change all mean for UK employers?
Labour’s plans to overhaul UK employment law
Labour plans to carry out a set of the most significant and wide-reaching changes to employment law for a generation. Its starting point is the bold assessment in its manifesto that ‘Britain’s outdated employment laws are not fit for a modern economy’ and it sets out intentions to bolster employment law rights for ‘working people’.
With a new Labour government comfortably moved into Whitehall, employers across England, Wales and Scotland should expect several employment law reforms to affect everyday business decisions in the coming months.
The proposed changes are numerous and vary in significance, but here is a summary of some of the key changes to be aware of:
- Unfair Dismissal – Day One Right
The new Government has promised to give employees protection from unfair dismissal from the first day of their employment. This will be a monumental shift in employment law, as current protection from unfair dismissal only kicks in after two years of continuous employment.
- Right to Flexible Working – Day One Right
The right to request flexible working became a day one right on 6 April 2024. The Labour Party has now stated that flexible working will be made the default for all workers, except where it is not reasonably feasible, from the first day of employment.
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- Statutory Sick Pay – Day One of Sickness Right
Labour will remove the four-day waiting period so that statutory sick pay (SSP) must be paid from day one of sickness, which will increase employers’ costs.
- Right to Switch Off
The Government has said it will introduce the ‘right to disconnect’ to promote healthier working practices. Looking to more flexible European models for inspiration, it plans to give workers and employers the opportunity to collaborate on the development of policies or contractual terms that benefit both parties.
- Family Leave Changes
The Labour Party will review the parental leave system, wanting to make ‘parental leave’ another day one right. It’s unclear if this means parental leave only or other kinds of right for parents to take family leave.
- Bereavement Leave
Many employers have a policy of compassionate leave already. The Government wants to make this a statutory entitlement.
- Increased Protection from Sexual Harassment
From October 2024, employers will already come under a new proactive duty to take ‘reasonable steps’ to protect employees from sexual harassment. However, the Government plans to further extend the protection by requiring employers to take ‘all reasonable steps’ to stop sexual harassment, including harassment by third parties, such as customers.
- More Pay Gap Reporting (for Employers with 250+ Employees)
In addition to gender pay gap reporting (which is going to be extended to include outsourced workers), the Government also plans to make ethnicity pay gap and disability pay gap reporting compulsory for employers with at least 250 employees.
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- Race Equality Act
The Government wants to extend the right to make equal pay claims to black, Asian and minority ethnic and disabled workers.
- New Single Status of “Worker”
Following consultation, the Labour Party plans to simplify the current multisystem for employment status. It wants to implement a new system where people are designated as either workers or self-employed, eliminating the current legal distinction between ’employees’ and ‘workers.’
Legislation is expected to be put before Parliament within the first 100 days of the Labour Party’s entry into government with respect to many of these proposals, so the finer expected details of these changes should soon become clear.
