Preparing for Tomorrow: Labour’s Manifesto and the Next Five Years in Employment

As Britain wakes up this morning, there will be very few who are surprised to see a change at Number 10. Keir Starmer predicted that the country would vote for change and it has. Unequivocally.

After 14 years of Conservative leadership the country has seemingly had enough and has demanded the change which Labour has promised.  Those promises include a host of proposed amendments to what it refers to as “Britain’s outdated employment laws [which] are not fit for the modern economy”. So, what are the proposed changes, and what impact will they have on employment law, employees and employers?

• Employment status to be simplified. Under current employment law, there are three categories of employment status: employee, worker and self-employed, with each afforded different rights and protections. Labour plan to implement two classifications, (1) for ‘workers’ and (2) for those ‘genuinely self-employed’. 

• All workers will be afforded the same rights and protections. Currently, worker status does not afford the same rights as employee status. Under the new system, all workers will be entitled to sick pay, holiday pay, parental leave and protection against unfair dismissal.

• Unfair dismissal from day one. There is currently a two-year continuous service qualifying period for an employee to be able to claim for unfair dismissal. Labour intend to scrap the two-year qualifying period, giving workers a right to not be unfairly dismissed from their first day of work. Labour have however promised that employers will still be able to operate probationary periods to assess new hires, so it will be interesting to see if the policies conflict. Labour also propose to remove the statutory cap on compensation (currently 52 weeks’ pay), and extend limitation periods within which employees can bring a claim.

• Parental leave from day one. There is currently a one-year qualifying period for parental leave. Parents have the right to take up to 18 weeks’ unpaid leave (up to 4 weeks per year) until the child turns 18. Labour will remove the qualifying period for parental leave.

• Statutory Sick Pay to be reformed. Labour intend to increase Statutory Sick Pay, remove the lower earnings limit (employees must currently earn an average of £123 per week to be eligible), and remove the three day waiting period.

• Ban on zero hours contracts. Contracts of work will require a minimum number of guaranteed hours per week to ensure than anyone working regular hours for twelve weeks or more will gain a right to a regular contract. All employers will be required to give their workers reasonable notice of any change in shifts or working time, with compensation that is proportionate to the notice given for any shifts cancelled or curtailed.

• End to fire and rehire. Labour will end the practice of firing and rehiring by introducing ‘effective remedies’ against abuse by introducing a strengthened code of practice.

• Equality at work. Labour will implement further harassment laws, including introducing protection from harassment for interns and volunteers and to reintroduce harassment protection from third parties. For employers with more than 250 employees, ethnicity and disability pay gap reporting will become mandatory, with current gender pay gap reporting and pay ratio reporting rules to include outsourced workers. 

• Redundancy. Labour will strengthen redundancy rights by ensuring the right to redundancy consultation is determined by the number of people impacted across the business rather than in one workplace.

For a more in-depth discussion on the proposed changes above and more, as well as what you can do now to prepare, join our free online webinar on Thursday 11^th July @ 12:00 BST.