Earlier today, the UK government unveiled details of its Employment Rights Bill, the most significant reform to employment laws in decades. The government claims this bill will make the workplace fairer and more adaptable to modern needs, benefiting both workers and employers, while promoting long-term economic growth.
You can view the full details of the bill here. Key reforms include:
- Day-one protections: Workers will be protected from unfair dismissal and entitled to paternity, parental, and bereavement leave from their first day on the job, removing the current two-year waiting period.
- Zero-hour contracts: The bill tackles exploitative zero-hour contracts, allowing workers on regular hours to request guaranteed hours while preserving flexibility for those who prefer it.
- Fire and rehire: The bill ends abusive fire and rehire practices, preventing companies from forcing employees onto worse terms when rehired.
- Statutory sick pay: Sick pay eligibility will be expanded by removing the lower earnings threshold and the waiting period before it starts.
- Flexible working: Flexible working will become the default, unless employers can show why it isn’t practical.
- Pregnancy and gender protections: Protections for pregnant women and new mothers against dismissal will be strengthened, and large employers will be required to address gender pay gaps and provide menopause support.
The bill also establishes a new Fair Work Agency to enforce rights such as holiday pay and sick leave, and repeals legislation introduced by the last government, including the Minimum Service Levels (Strikes) Act which aimed to limit striking action for essential services. The new Government has already set out how they plan to more regularly name and shame those organisations that fail to pay the minimum wage.
What will the reforms mean for business?
The new bill introduces significant reforms that increase protections for workers, including day-one leave entitlements, flexible working as the default, and stronger rules against exploitative practices like zero-hour contracts and fire-and-rehire tactics.
The Bill will now start its passage through Parliament with its second reading on 21st October, where Members of Parliament will debate the general principles of the Bill.
It is expected that key elements of the legislation will be subject to further consultation, in particular around the introduction of day one rights, and specifically the maximum length of, and rights that will apply within, a probationary period.
The earliest time frame for the new rights to take effect would be autumn 2026. This timeline means businesses will have time to prepare for the changes.
Reaction to the Employment Rights Bill
We have already seen some reaction to the announcements made by the government this morning from both unions and business leaders.
Ahead of the government announcement, UNISON’s general secretary Christina McAnea welcomed the reforms included in the bill, saying that the day-one rights, job flexibility, and the end of “exploitative work practices” will “transform workers’ lives for the better”.
Meanwhile in a statement published by the Confederation of British Industry (CBI), CBI CEO Rain Newton-Smith said that the government “deserves credit for its willingness to engage with businesses and unions on how to make a success of the Plan to Make Work Pay.” She then went on to say that the “willingness to work together” can help avoid the “unintended consequences that businesses have warned against.”
However, not all reactions have been positive. Following the Government’s announcement this morning, the Federation of Small Businesses (FSB) published a press release in which they claim the legislation “risks deterring small employers from taking a chance on someone who has had a significant period out of the workplace” adding that sufficient time should be taken to avoid this becoming a “hastily cobbled-together Act of Parliament.”
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