Work Under Construction: The Journey of the Employment Rights Bill

As we inch slowly along the required stages to legislative change with the Employee Rights Bill, last week saw a number of amendments being tabled following consultations with business groups, trade unions, and others. There is much dotting of the I's and crossing of the T's to go; but we are certainly edging ever closer towards the final outcome! The next step involves MPs debating and voting on the amendments before the bill progresses further through this process.

The main headlines that have come out this week vary in focus dependent on the source, with some employee groups and unions focusing on the “watering down” of rights regarding the “right to switch off” (for further discussion on this topic see our previous article Should we embrace “the right to disconnect” or fear it? ). The government has discarded this right completely from the bill. A government source said, “We have to lower business compliance costs as much as possible. …That means making Britain the best country in the world in which to do business – and a key part of that is removing unnecessary barriers.” Employer groups on the other hand are more directing their ire on changes that further “undermine flexibility”. The CIPD welcomes many of the revisions but states that, “The sheer number of amendments to this legislation published by the government underlines the size and complexity of this bill for employers.”, while the a spokesman for the Recruitment and Employment Federation worried that the bill could, “further raise the costs for employers when taking a chance on people and mire businesses in overly complex bureaucracy”

Having examined the amendments, although still lacking great detail and with little time until the bills’ third reading, they aim to address concerns about zero-hours contracts, "fire and rehire" practices, and bereavement leave.

Some of the key amendments include:

• Higher sick pay for low-paid workers than previously expected. Workers earning under £123 a week will be entitled to 80% of their wages as SSP1.
• Higher penalties for companies that use "fire and rehire" practices. The penalties will be doubled, meaning companies could be forced to pay workers 180 days' worth of pay, up from the current 90 days.
• Stronger rights to bereavement leave after miscarriages, including two weeks of bereavement leave for parents who suffer a miscarriage before 24 weeks' gestation.
• Agency workers will be included in the ban on exploitative zero-hours contracts and must be offered a minimum number of hours each week. There are around one million agency staff in the UK, working across most business areas such as warehousing, in hospitality and within the NHS. While unions welcomed this inclusion, the Recruitment and Employment Confederation (REC), implore that the change should not "undermine" the "flexibility" that zero-hour contracts offer some workers. There is still debate on how this hour’s level is to be calculated, whether based on a 12-week reference period or longer.
• Compensation for workers on zero-hours contracts whose shifts are changed at short notice. The actual compensation or what "short notice" means are not fully spelled out.
• Agency workers who choose to be on zero-hour contracts will be eligible for compensation if their shifts are cancelled or changed at short notice. This is a significant amendment and may address many peoples’ concerns of a loophole in previous detail.
• Increased powers for the Fair Work Agency to crack down on exploitative practices and bring civil proceedings against rogue employers.

The Government has said that it aims to create a balanced and fair environment for workers and businesses, promoting secure and well-paid jobs while addressing business concerns, with the amendments focusing on enhancing workers' rights and protections, with an emphasis on creating a fairer and more secure work environment.

There is a degree of certainty in some of the other reforms that have been proposed, and they are indeed extensive. They cover areas such as

• Removing the three-day waiting period for Statutory Sick Pay.
• Employees will gain unfair dismissal protections from their first day of work.
• Protections will be strengthened to prevent the dismissal of pregnant employees and new mothers.
• Paternity leave will become a right from day one and can be taken after shared parental leave.
• Bereavement leave will be extended to more family members and allow multiple leave periods.
• Any refusal by an employer to a flexible working request must be ‘reasonable’ (i.e. not just meet one of the statutory decline reasons) Employers must justify rejecting flexible work requests, and such claims will be referenced in tribunals.
• Banning “exploitative” zero-hour contracts, employers will be required to offer guaranteed hours based on an employee’s regular working pattern.
• Enhancing the current duty on employers to prevent sexual harassment by requiring the employer to take ‘all reasonable steps.
• Employers will become liable for third party harassment.
• Widening the scope of what is a public interest disclosure, to include the category of sexual harassment allegations.
• Removal the ‘at one establishment’ test in collective redundancy consultation threshold.
• Public sector contractors will have to ensure new employees are not paid less than transferred staff.
• Introduction of a requirement for employers to consult with any recognised trade union about the allocation of tips and gratuities, policy reviews to take place no longer than 3 years from previous review and for feedback gathered to be published anonymously to all workers.
• Ending fire and rehire: It will become automatically unfair to dismiss employees to rehire them on worse terms.
• Changing the collective redundancy consultation threshold.
• Requiring employers to consult with trade unions about the allocation of tips and gratuities.
• A Fair Pay Agreement framework will be introduced to improve pay negotiations in social care.
• The School Support Staff Negotiating Body will be re-established to oversee pay and conditions for school support staff.
• The right to be given a statement of trade union rights, and the right to paid time off for trade union Equality Representatives, and other rights for trade union recognition etc.
• Government enforcement of employment rights related to agency workers, sick pay, holiday pay, the NMW Gangmasters licencing and modern slavery.
• Ship operators to notify the Secretary of State of collective redundancies affecting a ship’s crew.
• Large employers will have to publish plans on how they will address gender pay disparities.
• Companies will be required to provide gender pay data for outsourced service providers.
  
  

As far as what employers and employees can do at the moment, we all must await the outcomes these consultations and debates, then further development of new regulations, and the creation / amendment of codes of practice - but much of this is expected to become law by the Summer at the latest, so it is very advisable to monitor the situation judiciously. How it will affect business and employee flexibility is still very much dependent on this still unspecified detail, what will be the consequence for fluctuating or seasonal work, for instance, is still a complete unknown.

As many of these changes will impact on those workers with insecure, irregular work it is clear that the legislation will have most effect on younger workers who generally fill these lower paid or temporary jobs, as verified by the Resolution Foundation and The Joseph Rowntree Foundation.

Generally the changes are popular, with a YouGov poll suggesting that the original reform published in October 2024, are supported by about two thirds of voters. They certainly may allow people requiring flexibility to move on from jobs preventing them being stuck in a job they’ve outgrown due to new the day one right and assumption for flexibility.

Extending the statutory sick pay to day one has got to be positive for many. The fact that people couldn’t afford to take time off due to sickness was seen during the pandemic, when people were infectious. However, it may be a good judgement to monitor this, to prevent abuse, and further understand genuine sickness. A good workforce management system would be recommended for this.

The Employment Rights Bill 2025 could well represent a significant step to enhancing workers' rights and creating a fairer work environment in the UK. These changes are expected to have a positive impact on workers by providing greater job security, fair treatment, and financial support, they also present challenges for employers who will need to adapt to the new regulations and manage the associated costs.

If indeed this leads to further uptake of flexibility, then it must be noted that any flexible working can add to complications and can cause confusion for both employers and employees, leading to disputes over pay and/or regulations if not well managed.

All these issues can be handled automatically by Crown’s Workforce Management system.

Ensuring accurate scheduling and compliance with established or new guidelines minimises disruptions and reduces the risk of scheduling errors or payroll discrepancies. This automation simplifies the process for both employers and employers. Crown’s system seamlessly oversees these complexities, helping to alleviate stress and confusion while enhancing operational efficiency.