Tag: Employment Rights Bill

Employment Rights Bill to boost productivity for British workers

The Westminster Government will today table amendments to the Employment Rights Bill

  • The Government has laid amendments to the Employment Rights Bill following weeks of consultation with business groups and unions. 
  • The Bill will support the Government’s mission to increase productivity and create the right conditions for long-term sustainable, inclusive, and secure economic growth, delivering on the Plan for Change.
  • Improving workers’ rights is a key element of the government’s Plan for Change by putting more money in people’s pockets, improving working people’s day to day lives and delivering real life improvements felt by working people. 

The Government yesterday tabled amendments to the Employment Rights Bill following weeks of consultation and responses from business groups, trade unions and wider civil society. 

The Labour government says these amendments demonstrate the Government’s commitment to working in partnership with businesses and trade unions to ensure the plan to Make Work Pay is firmly pro-business and pro-worker. 

Responses to five consultations ranging from zero-hours contracts to Statutory Sick Pay will also be published which show how the Government has listened to the views of stakeholders. 

The Government’s Plan to Make Work Pay is a core part of the mission to grow the economy, raise living standards and create opportunities for people across the country. These amendments will deliver on the Plan for Change by tackling the low pay, poor working conditions and poor job security that has been holding the UK economy back. 

This landmark Bill will extend the employment protections already given by the best British companies to millions more workers. This will put the UK back in step with competitors in other advanced economies, who are already acting to adapt to the changing world of work. 

The Bill’s impact assessment, which was published last year, showed that many of the policies within the Employment Rights Bill could help support the Government’s Mission for Growth.

It concluded that that the package could have “a positive but small direct impact on economic growth” and will “help to raise living standards across the country and create opportunities for all.” This is the result of a pro-business, pro-worker, approach which is going to help usher in a decade of national renewal. 

Deputy Prime Minister Angela Rayner said: “For too long millions of workers have been forced to face insecure, low paid and irregular work, while our economy is blighted by low growth and low productivity.   

“We are turning the tide – with the biggest upgrade to workers’ rights in a generation, boosting living standards and bringing with it an upgrade to our growth prospects and the reforms our economy so desperately needs.   

“We have been working closely with businesses and workers to progress this landmark bill and deliver our Plan for Change – unleashing growth and making work pay for everyone.”

Business Secretary Jonathan Reynolds said: “Past Governments’ low growth and low productivity economy simply did not deliver what the UK needs, which is why we are choosing stability, investment and reform, not chaos, austerity and decline. This is why our mission to grow the economy as part of our Plan for Change is based on putting more money in working people’s pockets by making wages fairer and work more secure.  

“Many businesses already have worker friendly practices in place and can attest to the positive impact they have on retention, productivity and job satisfaction. We want to go further and untap the UK’s full potential by attracting the best talent and giving business the confidence to hire to help the economy grow.”

The amendments set out later today carefully consider different views and needs of workers, businesses and the whole economy and looks to deliver measures that support the mutual interests required to drive a growing, modern economy.

The government says they are delivering reform through the Plan for Change to create a decade of national renewal, meaning increased living standards across every part of the UK and putting politics back in the service of working people. 

They come following responses received to five Government consultations: 

  • Application of zero hours contracts measures to agency workersAll workers, including up to 900,000 agency workers in the UK, should be able to access a contract which reflects the hours they regularly work. These amendments will ensure that agency work does not become a loophole in our plans to end exploitative zero hours contracts. They will offer increased security for working people to receive reasonable notice of shifts and proportionate pay when shifts are cancelled, curtailed or moved at short notice – whilst retaining the necessary flexibility for employers in how they manage their workforces.  
  • Strengthening remedies against abuse of rules on collective redundancyThe Government will increase the maximum period of the protective award from 90 days to 180 days and issue further guidance for employers on consultation processes for collective redundancies. Increasing the maximum value of the award means an Employment Tribunal will be able to grant larger awards to employees for an employer’s failure to meet consultation requirements. We want to enhance the deterrent against employers deliberately ignoring their collective consultation obligations and ensure it is not financially beneficial to do so. 
  • Creating a Modern Framework for Industrial RelationsThe government is updating the legislative framework in which trade unions operate to align it with modern work practices. We are ensuring industrial relations are underpinned by collaboration, proportionality, accountability, and a system that balances the interests of workers, businesses and the wider public, with further details in the consultation response.   
  • Strengthening Statutory Sick PayThe Government will ensure the safety net of Statutory Sick Pay is available to those who need it the most, making it a legal right for all workers for the very first time.  Up to 1.3 million employees on low wages who find themselves unable to work due to sickness will either receive 80 per cent of their average weekly earnings or the current rate of Statutory Sick Pay – whichever is lower. We are also ensuring employees have a right to Statutory Sick Pay from the first day of sickness absence, so they are able to take the time off they need to recover and stay in work rather than risk dropping out altogether. The changes will also reduce the amount of people going to work when ill and therefore the spread of infections in the workplace – boosting productivity and benefiting businesses. 
  • Tackling non-compliance in the umbrella company marketThe Government will act to ensure that workers can access comparable rights and protections when working through a so-called umbrella company as they would when taken on directly by a recruitment agency. Enforcement action can be taken against any umbrella companies that do not comply.  

A strong package of workers’ rights and protections goes hand in hand with a strong economy because a secure workforce will be more productive and have more confidence to spend in the economy. This contributes to growth – both through the work that people do, and the money that they spend. 

As well as creating protections for people at work, the Government is determined to create a modern economy that works for businesses and workers alike. We are delivering these reforms collaboratively, pragmatically, and in a reasonable timeframe where businesses can prepare.  

For businesses to thrive they must operate on a level playing field. The Fair Work Agency will take strong action against rogue employers that exploit their workers, and it will provide better support to the majority of businesses who want to do right by their staff. 

The Government says they will continue to hold continuous extensive engagement as they develop their Plan to Make Work Pay and as the details of these polices are developed. 

Paul Nowak, TUC General Secretary said: “Everyone deserves security and respect at work. These common-sense reforms will improve the quality of jobs in this country, boost growth and put more money into people’s pockets. 

“Policies like banning exploitative zero-hours contracts, ensuring protection from unfair dismissal from day one, and tackling ‘fire and rehire’ are long overdue and necessary. 

“This is about creating a modern economy that works for workers and business alike. Driving up employment standards in Britain will stop good employers from being undercut by the bad and will mean more workers benefit from a union voice.”

Interim Acas CEO, Dan Ellis, said: “Acas is committed to making working life better for everyone in Britain and we welcome the Government’s focus on improving workplace relations.

“The Government has made some new amendments to the Employment Rights Bill that impacts agency workers, statutory sick pay rules and employers that want to make 20 or more employees redundant.

“The Bill is currently going through Parliament and is subject to further debate and revisions. We will continue to work with the Government and partners to support businesses and workers to prepare for the new law changes.”

Jane Gratton, Deputy Director of Public Policy at the BCC, said: “Employers will be relieved to see some amendments, at what is clearly a milestone moment for Government.

“It has consulted business – and this is reflected in some of the decisions on the future shape of the legislation. There is much here to welcome as sensible moves that will help ensure that employment works for both the business and the individual, including the nine-month statutory probation period and the promise of a light touch approach, as well as simplifying rules on collective consultation. 

“But businesses remain cautious, and it is important to continue ensuring the Bill strikes the right balance.  Employers will look forward to hearing, engaging with and shaping further detail.

“The government must continue its positive approach to engagement with firms and remain open to changes. Doing so will ensure this legislation is proportionate, affordable, and right for both firms and their employees.”

Centrica Group Chief Executive, Chris O’Shea said: “We are fully supportive of this legislation. This isn’t just the right thing to do—it’s a foundation for the high-growth, high-skill economy the UK needs.

“While no one business has all the answers, our experience at Centrica shows that our business thrives when our people thrive – so stronger rights for workers mean stronger businesses, and that’s a win for everyone.  

“As we look to invest billions in green energy, nuclear, and hydrogen storage, having a skilled and engaged workforce is critical to delivering on the UK’s energy security and net zero ambitions. The Government’s wider growth and energy missions rely on businesses and workers pulling in the same direction—I hope this Bill helps make that possible.”

Julie Abraham, CEO of Richer Sounds said: “At Richer Sounds, we have always put the treatment and wellbeing of our colleagues at the forefront of everything we do.  Any responsible business will know that well-treated and well-paid colleagues will be beneficial in numerous ways.  

“Happy colleagues are likely to be more productive. This also leads to reduced stock loss and higher staff retention, which in turn, minimises recruitment and training costs, not to mention disruption to established teams. 

“We support any government legislation that will help end exploitative working practices and improve the lives of working people.”

Ann Francke OBE, Chief Executive Officer of the Chartered Management Institute (CMI), said: “The Employment Rights Bill represents a significant step forward in improving conditions for the UK’s workforce. Many of these measures reflect what successful, responsible and forward-looking employers are already doing.  

“CMI has welcomed the Government’s collaborative approach in progressing this Bill, working alongside both businesses and unions to find the balance needed. The real key to success, however, will be the ability of skilled managers to implement these changes, ensuring they get it right and can deliver growth and productivity benefits for organisations whilst ensuring individuals are treated fairly.  

“We look forward to working closely with the Fair Work Agency to ensure managers and leaders are equipped with the skills they need to navigate this milestone piece of legislation.”

Simon Deakin, Professor of Law, University of Cambridge said: “The research we have done in Cambridge shows that on average, strengthening employment laws in this country in the last 50 years has had pro-employment effects.  

“The consensus on the economic impacts of labour laws is that, far from being harmful to growth, they contribute positively to productivity. Labour laws also help ensure that growth is more inclusive and that gains are distributed more widely across society.”

Claire Costello, Chief of People and Inclusion Officer – Co-op: “The Co-op support the Government’s ambitions to strengthen rights for workers through the Employment Rights Bill.

“It’s our belief that treating employees well – a key objective of this Bill – will promote productivity and generate the economic growth this country needs.”

Neil Carberry, CEO of Recruitment & Employment Confederation, said: “Regulating the umbrella market closes a loophole in addressing non-compliance.

“Recruiters have long called for regulations that ensure a level playing-field. Like all aspects of the Government’s changes, proper enforcement will be key to protecting both businesses and workers.”

TUC: ‘Huge support’ for Government’s plan to make work pay

The landmark Employment Rights Bill is ‘vote winner’

Voters in every constituency overwhelmingly support key measures to strengthen workers’ rights, according to new polling published by the TUC and Hope Not Hate today.

In recent months, there has been criticism of the Bill from Conservative and Reform politicians and parts of the business lobby.

But this polling decisively proves that those opponents are a world away from the views of the British public.

The public wants stronger worker protections

The poll of over 21,000 people reveals huge backing across the country and across the political spectrum –  including with Reform and Conservative voters – for key policies in the Bill. The poll shows:  

  • Banning zero hours contracts by giving workers a contract that reflects their regular hours: More than 7 in 10 (72%) of UK voters support a ban on zero hours contracts – including 2 in 3 Reform (65%) and Conservative (63%) voters from the 2024 general election support banning zero hours contracts. The figure is even higher with those saying they would vote Conservative (65%) and Reform (67%) if there was a general election held tomorrow. Just 15% oppose the policy.  
  • Giving all workers statutory sick pay from day one: 3 in 4 (74%) voters support giving all workers the right to statutory sick pay, and ensuring it is paid from the first day – including 2 in 3 Reform (64%) and Conservative (62%) voters from the 2024 general election. The figure is even higher with those saying they would vote Conservative (65%) and Reform (66%) if there was a general election held tomorrow. Just 14 % oppose the policy.
  • Giving all workers protection from unfair dismissal from day one: 3 in 4 (73%) voters support giving all workers protection from unfair dismissal from the first day in the job – including 2 in 3 Reform (62%) and Conservative (62%) voters from the 2024 general election. The figure is even higher with those saying they would vote Conservative (65%) and Reform (64%) if there was a general election held tomorrow. Just 14% oppose the policy.  
  • Making it easier for people to have flexibility in their patterns or hours of work: 3 in 4 (74%) voters support making it easier to work flexibly – including 2 in 3 Reform (63%) and Conservative (64%) voters from the 2024 general election. The figure is even higher with those saying they would vote Conservative (67%) and Reform (65%) if there was a general election held tomorrow. Just 12% oppose the policy. 

Break down by constituency level 

The poll breaks down to constituency level – and reveals that voters in every single constituency are behind the Bill’s flagship policies.

Click on the interactive map below to see how each constituency voted. Use the search field to find your constituency, and the drop-down menu at the top to view data for each policy.

https://flo.uri.sh/visualisation/21515919/embed?auto=1

A Flourish map

Reform is defying its own voters on workers’ rights

Interestingly, the new poll shows the measures the government is taking through Parliament are hugely popular with Reform voters from 2024 as well as Reform-leaning voters (those who would vote Reform if there was an election tomorrow).

In every Reform-held constituency, including in Reform leader Nigel Farage’s seat, there is significant support for banning zero hours contracts and giving sick pay to everyone from day one.  

And yet Reform MPs have voted against the Bill at every stage. The party are defying their own voters and constituents on workers’ rights. This proves beyond doubt that Nigel Farage and Reform aren’t on the side of working people – they’re on the side of bad bosses, zero hours contracts and fire and rehire.

Labour, Conservative, Green and Lib Dem voters also significantly back the policies. It’s clear that the Employment Rights Bill is that rare thing –  a policy which is genuinely popular across traditional party lines.

Time for change

After the failed Conservative era of a low-rights, low-pay, and low-growth economy, voters can see the importance of making work pay and ending the scourge of insecure work.

That’s why the government must ignore the noise and deliver the Employment Rights Bill in full.  

Improving job quality and putting more money into people’s pockets is an urgent national mission and a key plank of the government’s wider plan to grow the economy. Those who defend the broken status quo are simply putting their own vested interests above working people.

Voters across the political spectrum want work to pay and to feel secure and respected in their jobs. The government has a historic opportunity – and an electoral mandate – to make work pay. The plan to make work pay is hugely popular, and this poll should give ministers the confidence to deliver it in full.

JRF report shows ‘shockingly high’ number of children in poverty living in working families, says TUC

The latest Joseph Rountree Foundation (2025) UK Poverty 2025 Report clearly shows that work doesn’t protect families from poverty.  

In particular, the report highlights the “shockingly high” number of children living in poverty in working families:   

  • 50% of children in families where at least one adult is (but not all adults are) in work live in poverty.  

Working-age adults are also impacted: 

  • Two-thirds (68%) of working-age adults living in poverty are in a household where at least one adult works.  

Responding to these figures, TUC General Secretary Paul Nowak said: “Every worker deserves to earn a decent living. But many working households are struggling to keep their heads above water.  

“This is unacceptable. Working people should be able to put food on the table for their families and keep their children warm during the winter.   

“After 14 years of Tory chaos and stagnation, we urgently need to boost living standards.   

“That’s why this government’s Make Work Pay agenda is so crucial for millions of families up and down the country. 

“More money in working people’s pockets means more spend on our high streets – that’s good for workers and good for local economies.  

“And the Employment Rights Bill will mean more good and secure jobs – boosting productivity for businesses and giving workers more control over their lives and better chances to progress.  

“Better work is crucial for ending child poverty, but decent social security matters too. The Government must remove the two-child benefit cap which is keeping too many children in working households in poverty.” 

jrf-uk-poverty-report-25Download

Sick pay decision for two million low-paid workers could have huge impact on families’ living standards

How much should someone receive when they are off sick from work?

This is the question that ministers were considering over Christmas. And the answer they arrive at will have a huge impact on many households’ budgets (writes TUC’s TIM CLARK).

For the majority of workers today the answer to that question is straightforward: when they are ill they simply receive their normal salary for a period.

Others, particularly many low-paid workers get less-than-generous statutory sick pay (SSP), currently £116.75 a week, if they are ill. But this only kicks in from the fourth day of absence.

More than a million workers wouldn’t receive anything when absent because they earn too little to qualify under current rules. They are often part-time workers and are predominantly women.

This means many workers face hardship if they suffer illness or injury or risk spreading illness in their workplace by attending while sick.

This could change as ministers implement their promise that “no one should be forced to choose between their health and financial hardship”. 

Measures in the Employment Rights Bill being considered by MPs will scrap the qualifying earnings test and sick pay will be paid from the first day of absence in future.

The options on the table

But how effective these changes will be rest on the percentage rate to be paid to low earners. 

A government consultation on the rate closed earlier this month.

Among the options modelled was an SSP payment as low as 60 per cent of wages.

This would be the entitlement for the lowest paid 2.3 million workers,

Under the current proposals, this could lead to some 1.1 million workers who are currently entitled to full SSP eligible for less under the new system because they currently get full SSP, albeit at less than £117 a week.

The TUC is urging the government to ensure that workers receive the lower of their earnings or statutory sick pay. At the very least they should receive 95 per cent of pay to reflect the payments received by the lowest-earning workers who currently qualify for SSP. 

For this is not a cold exercise in abstract numbers. There is a risk that some low earners could miss out the equivalent of a family’s food budget if ministers opt for lower pay-outs. 

Scenarios set out below show the potential real-world impact of ministers’ decisions.

Scenario one

Rita works 10 hours a week (two hours a day) in an office canteen on the national minimum wage. Her partner is a sales assistant earning £25,000.    

One weekend, Rita sprains her foot and is unable to work that week.

She has no access to occupational sick pay and currently would be unable to claim SSP as she earns under the lower earnings limit of £123 required to qualify. This means that the household income is cut by £114.40 a week. 

She struggles to give her three children money for their daily school meals and out-of-school sports activities and has to use money set aside for the next energy bill.

Under the new system, if the rate is set on the basis of the lower amount of earnings or SSP she would receive £114.40. 

However, a 60 per cent rate, one of the options modelled by the government in its latest consultation would mean she only receives £68.64. This cut of £45.76 is close to what a family spends on school meals for three children every week. 

Scenario two  

Sam is a single parent earning the national minimum wage at a food factory – working part time for nine hours Monday to Wednesday and gets paid weekly. 

Sam catches a nasty cold and is unable to work Monday to Wednesday. She has no access to occupational sick pay, and, under the current system doesn’t earn enough to qualify for SSP.

She claims Universal Credit and by notifying the DWP about a drop in earnings in the next assessment period could receive a higher universal credit payment. But this wouldn’t be paid out for more than a month, leaving her immediate bills to pay.

But if payouts were the lowest of SSP and actual earnings Sam would have received £102.96 in wages.

A 60 per cent rate would mean getting only £61.78. This £41 drop is more than the typical £35.40 that a family in the lowest income decile spends on groceries and non-alcoholic drinks (families overall spent on average £63.50 a week according to the official figures from 2023). 

This means that Sam and her two children would struggle to buy food that week, although they would be better off than currently. 

Scenario three  

Raj works two jobs. On Monday to Tuesday he works part time at a retail store for three hours a day. He works at a florist on Wednesday and Thursday for two hours. 

This is to fit in with caring responsibilities for three children with his wife who works at the local biscuit factory from Monday to Friday (9-5pm). She earns slightly above the national minimum wage, and both Raj’s jobs are on the minimum wage. 

Due to a car accident, he is unable to work for three months – this causes immense pressure on the family finances as during this period Raj receives no earnings.

If he received SSP based on his actual earnings this would have been £114.40 a week.

But at a 60 per cent rate he would receive £68.64 a week. This would mean that over the course of 12 weeks he would receive£549.12 less than if he was getting his normal earnings.

This is equivalent to almost two years’ worth of spending on clothes and footwear for a family in the lowest income decile at £5.60 a week.

Conclusion 

The coronarvirus outbreak showed the dangers of an inadequate sick pay system.

Lots of frontline workers were forced to choose between falling into poverty because they got no or little sick pay, or continue to work and risk spreading the virus.

Four years on and many workers continue to face similar dilemmas every week.

The government is making the right choice in extending sick pay to all workers, without an income test.

But when ministers announce payouts for low-paid workers in the coming weeks, they should peg them to SSP or wages, whatever is the lower. And no-one should be entitled to less after the changes, than they are now.

Then the next stage will be ensuring that the headline rate of SSP is improved.

TUC: Workers’ rights reforms could benefit economy by over £13bn a year

  • New analysis shows how improving employment standards, employee well-being and modernising industrial relations will benefit the economy
  • TUC General Secretary Paul Nowak gave evidence to MPs as Employment Rights Bill enters committee stage
  • Making Work Pay agenda is an “urgent national mission” that is “good for workers and good for business”, says union body

New TUC analysis published yesterday (Tuesday) shows that even modest gains from the government’s workers’ rights reforms would benefit the UK economy by over £13bn a year.

The analysis models some of the key benefits of the Employment Rights Bill – identified by the government’s impact assessment of the Bill.

The research shows that even if the Bill just delivers small improvements in areas such as employee wellbeing, industrial relations and labour market participation the economic gains will outweigh any costs.

The analysis looks at the scale of the benefits implementing the Employment Rights Bill could bring across a range of workplace measures:

  • Workplace stress: Between £490 million and £974 million would be gained by reducing the number of working days lost to stress, depression or anxiety.
  • Staff well-being: Between £310 million and £930 million a year would be gained from improving staff well-being.
  • Minimum wage compliance: Between £42 million and £168 million a year would be gained through improving minimum wage compliance.
  • Strikes: Between £255 million and £510 million a year would be gained through resolving disputes that lead to workers taking action.
  • Industrial relations: Between £2.7bn and £8.1bn a year would be gained through reduced workplace conflict
  • Increased labour market participation: Between £1.3bn and £2.6bn a year would be gained through increasing employment for people currently looking after family or home.

The research shows that the cumulative impact of even modest improvements would be £13.3bn a year – and stronger outcomes could generate even greater gains.  

The TUC says the analysis confirms the view of the government’s impact assessment that there is “clear, evidence-based benefits of government action through the Bill.”

The impact assessment also warns that “not acting would enable poor working conditions, insecure work, inequalities and broken industrial relations to persist.”

Evidence to MPs

The findings were published as TUC General Secretary Paul Nowak prepared to give evidence to MPs as the Employment Rights Bill enters its committee stage.

Nowak told parliamentarians that improving the quality of work in Britain is an “urgent national mission” that will benefit workers and businesses alike.

Polling published in July revealed huge backing across the political spectrum for boosting workers’ rights.

And polling published in September revealed that an overwhelming majority (75%) of employers support the government’s measures, including nearly seven in 10 (69 per cent) of small businesses.  

TUC General Secretary Paul Nowak said: “Far too many working people are trapped in jobs that offer them little or no security. We can’t carry on with this broken status quo.

“Improving the quality of work in this country is an urgent national mission that will bring real economic gains.

“Driving up employment standards, improving employee well-being and increasing labour market participation is good for staff and good for businesses.

“When workers are treated well they are happier, healthier and more productive.

“The Employment Rights Bill is a historic opportunity to make work pay – and to create a level playing field that stops good employers from being undercut by the bad.  

“It must be delivered in full.”

Commenting on the impact of the Bill on employers, Paul added: “The TUC stands ready to work with the government and employers. We recognise that businesses and unions will need advice to understand and implement these changes.

“But there is no case for delaying the reforms. People need jobs they can build a decent life on.

“Many of the arguments being used against this legislation are the same ones that were used against introducing the minimum wage – one of the great policy successes of the last 25 years.

“They were wrong then and they are wrong now. When working people thrive so do businesses and the wider economy.” 

New protections from sexual harassment come into force

Employers now have a legal duty to take reasonable steps to prevent sexual harassment and create a safe working environment

  • New duty under the Equality Act 2010 will require employers to take “reasonable steps” to prevent sexual harassment of their employees.
  • New guidance for employers on how they can protect their staff.
  • New measure comes into force as further legislation goes through Parliament to boost economic growth by tackling poor productivity, insecure work and broken industrial relations.

From Saturday 26 October, employees can expect their employers to take reasonable steps to protect them from sexual harassment as a new duty comes into force.

Employers now have a duty to anticipate when sexual harassment may occur and take reasonable steps to prevent it. If sexual harassment has taken place, an employer should take action to stop it from happening again. This sends a clear signal to all employers that they must take reasonable preventative steps against sexual harassment, encourage cultural change where necessary, and reduce the likelihood of sexual harassment occurring.

Anneliese Dodds, Minister for Women and Equalities, said: “This government is determined to ensure that we not only Make Work Pay; we also make work safe.

“Too many people feel uncomfortable or unsafe at work due to sexual harassment and we are putting every effort into putting a stop to it. The preventative duty is an important step on the journey, and we will continue to improve protections for workers until everyone can thrive.

“The Equality Act provides legal protections against sexual harassment in the workplace. Despite this, persistent reports and revelations in recent years indicate that it remains a problem. So from today employers will be required to take ‘reasonable steps’ to prevent sexual harassment of their employees.

“We will strengthen this duty through our Employment Rights Bill, which had its Second Reading this week, and will boost economic growth by tackling poor productivity, insecure work and broken industrial relations.”

Guidance for employers on developing appropriate plans and policies has been published by the Advisory Conciliation and Arbitration Service (Acas) and the Equality and Human Rights Commission.

This includes what behaviour needs to be addressed and how complaints should be handled, to help employers protect their staff and avoid tribunals.

Government unveils ‘most significant reforms to employment rights’

Ministers have unveiled the Employment Rights Bill to help deliver economic security and growth to businesses, workers and communities across the UK

  • Legislation introduced in Parliament to upgrade workers’ rights across the UK, tackle poor working conditions and benefit businesses and workers alike 
  • Ahead of International Investment Summit, government reveals landmark reforms in under 100 days to boost pay and productivity, showing the benefits of a ‘pro-business, pro-worker’ approach 
  • New balance for early months of a job at heart of pragmatic reforms to help drive growth in the economy and support more people into secure work 
  • Employment Rights Bill will end exploitative zero-hour contracts and unscrupulous fire and rehire practices, while establishing rights to bereavement and parental leave from day one 

Today (10 October) ministers have unveiled the Employment Rights Bill to help deliver economic security and growth to businesses, workers and communities across the UK.  

Getting the labour market moving again is essential to economic growth with one in five UK businesses with more than 10 employees reporting staff shortages. Flexibility, for workers and businesses alike, is key to answering this challenge and is at the heart of the legislation to upgrade the law to ensure it is fit for modern life and a modern economy. 

The existing two-year qualifying period for protections from unfair dismissal will be removed, delivering on the manifesto commitment to ensure that all workers have a right to these protections from day one on the job. 

The government will also consult on a new statutory probation period for companies’ new hires. This will allow for a proper assessment of an employee’s suitability to a role as well as reassuring employees that they have rights from day one, enabling businesses to take chances on hires while giving more people confidence to re-enter the job market or change careers, improving their living standards.  

The bill will bring forward 28 individual employment reforms, from ending exploitative zero hours contracts and fire and rehire practices to establishing day one rights for paternity, parental and bereavement leave for millions of workers. Statutory sick pay will also be strengthened, removing the lower earnings limit for all workers and cutting out the waiting period before sick pay kicks in. 

Accompanying this will be measures to help make the workplace more compatible with people’s lives, with flexible working made the default where practical. Large employers will also be required to create action plans on addressing gender pay gaps and supporting employees through the menopause, and protections against dismissal will be strengthened for pregnant women and new mothers.

This is all with the intention of keeping people in work for longer, reducing recruitment costs for employers by increasing staff retention and helping the economy grow. 

A new Fair Work Agency bringing together existing enforcement bodies will also be established to enforce rights such as holiday pay and support employers looking for guidance on how to comply with the law. 

Deputy Prime Minister Angela Rayner said: “This government is delivering the biggest upgrade to rights at work for a generation, boosting pay and productivity with employment laws fit for a modern economy.

“We’re turning the page on an economy riven with insecurity, ravaged by dire productivity and blighted by low pay. 

“The UK’s out-of-date employment laws are holding our country back and failing business and workers alike. Our plans to make work pay will deliver security in work as the foundation for boosting productivity and growing our economy to make working people better off and realise our potential. 

“Too many people are drawn into a race to the bottom, denied the security they need to raise a family while businesses are unable to retain the workers they need to grow. We’re raising the floor on rights at work to deliver a stronger, fairer and brighter future of work for Britain.”

Business Secretary Jonathan Reynolds said: “It is our mission to get the economy moving and create the long term, sustainable growth that people and businesses across the country need. Our plan will give the world of work a much needed upgrade, boosting pay and productivity.    

“The best employers know that employees are more productive when they are happy at work.  That is why it’s vital to give employers the flexibility they need to grow whilst ending unscrupulous and unfair practices.  

“This upgrade to our laws will ensure they are fit for modern life, raise living standards and provide opportunity and security for businesses, workers and communities across the country.”

Alongside the legislation, a ‘Next Steps’ document for the Make Work Pay Plan has been published outlining the government’s vision and long-term plans and setting out our ambitions for the plan to grow the economy, raise living standards across the country and create opportunities for all. 

Ending one-sided flexibility

The legislation will level the playing field where all parties understand what is required of them and good employers aren’t undercut by bad ones.  

The bill will end exploitative zero hours contracts, following research that shows 84% of zero hours workers would rather have guaranteed hours. They, along with those on low hours contracts, will now have the right to a guaranteed hours contract if they work regular hours over a defined period, giving them security of earnings whilst allowing people to remain on zero hours contracts where they prefer to. According to TUC research nearly two thirds of managers (64%) believe ending zero hours contracts would have a positive impact on their business.  

Ending unscrupulous employment practices is a priority for this government and none more so than shutting down the loopholes that allow bullying fire and rehire and fire and replace to continue. The government is closing these loopholes and putting in place measures to give greater protections against unfair dismissal from day one, ensuring that the feeling of security at work is no longer a luxury for the privileged few. 

This bill turns the page on the previously ineffective, costly and conflicting approach to dealing with industrial relations that has brought so much disruption to businesses and livelihoods. lt repeals the anti-union legislation put in place by the previous administration, including the Minimum Service Levels (Strikes) Act legislation that failed to prevent a single day of industrial action while in force. 

Employment Rights Minister Justin Madders said: “We know that most employers proudly treat their staff well. However, for decades as the world of work has changed, employment rights have failed to keep pace, with an increase in one-sided flexibility slowing the potential for growth in the economy.

“The steps we’re taking today will finally right these wrongs, working in partnership with business and unions to kickstart economic growth that will benefit them, their workers and local communities.  

“From tackling fire and rehire to ending exploitative zero hours contracts, we are delivering a modern economy that drives up living standards for families across the UK.”

Supporting working families

Too many people find that the current system isn’t compatible with the realities of everyday life, whether that’s raising children or supporting a loved one with a health condition. The government wants to make sure that everyone can get on in work and not be held back because work isn’t compatible with important family responsibilities. 

That is why the government will:

  • Change the law to make flexible working the default for all, unless the employer can prove it’s unreasonable.   
  • Set a clear standard for employers by establishing a new right to bereavement leave, with the entitlement sculpted with the needs of employees and the concerns of employers at the forefront.  
  • Deliver stronger protections for pregnant women and new mothers returning to work including protection from dismissal whilst pregnant, on maternity leave and within six months of returning to work.   
  • Tackle low pay by accounting for cost of living when setting the Minimum Wage and remove discriminatory age bands.  
  • Establish a new Fair Work Agency that will bring together different government enforcement bodies, enforce holiday pay for the first time and strengthen statutory sick pay. It will create a stronger, recognisable single organisation that people know where to go for help – with better support for employers who want to comply with the law and tough action on the minority who deliberately flout it.   

Beyond the bill

The Make Work Pay Plan doesn’t stop with this bill. Continuing to reform employment rights in line with changes to the economy and labour market is critical to maintaining growth, prosperity and opportunity. As an outlook to the future, the government has also today published a Next Steps document that outlines reforms it will look to implement in the future.  

Subject to consultations, this includes:

  • A Right to Switch Off, preventing employees from being contacted out of hours, except in exceptional circumstances, to allow them the rest and get the recuperation they need to give 100% during their shift. 
  • A strong commitment to end pay discrimination by expanding the Equality (Race and Disparity) Bill to make it mandatory for large employers to report their ethnicity and disability pay gap.  
  • A move towards a single status of worker and transition towards a simpler two-part framework for employment status.  
  • Reviews into the parental leave and carers leave systems to ensure they are delivering for employers, workers and their loved ones.

Responding to the government’s initiative, these businesses and employee groups have said:

Shirine Khoury-Haq, CEO of the Co-op, said: “We support the Government’s ambitions to strengthen rights for workers and value the co-operative approach to involve employers in the reforms.

“As the UK’s largest consumer co-operative, Co-op has long supported colleagues to have good working lives, with policies like our leading bereavement leave, day one right to request flexible working arrangements, and menopause support already in place. The positive impact of these policies is clear to see. 

“Being able to support colleagues when they need it, and in particular women, parents and carers, helps retain valuable talent and makes good business sense. We look forward to continuing to work with Government to make work pay and to deliver economic growth.” 

Paul Nowak, TUC General Secretary, said: “After 14 years of stagnating living standards, working people desperately need secure jobs they can build a decent life on.    

“Whether it’s tackling the scourge of zero-hours contracts and fire and rehire, improving access to sick pay and parental leave, or clamping down on exploitation – this Bill highlights the Government’s commitment to upgrade rights and protections for millions.    

“Driving up employment standards is good for workers, good for business and good for growth. While there is still detail to be worked through, it is time to write a positive new chapter for working people in this country.”    

Jane van Zyl, CEO at Working Families, said: “As campaigners for better rights for working parents and carers, we’re pleased there is hope on the horizon for the millions who stand to benefit from the transformational changes in the proposed Employment Bill.  

“Establishing workplace rights from day one and making flexible working the default could be the key to unlocking labour market mobility, with the promise of getting the economy moving and ensuring parents and carers are not held back in their careers.

“In addition, we welcome any strengthening of legislation that helps protect pregnant women and new mothers against losing their jobs unfairly at a vulnerable time in their lives.  

“The proposals in the Plan to Make Work Pay have the potential to remove barriers in the workplace, give a better start for new parents and reduce gendered roles in caring. The message it sends that worker’s rights matter, and the willingness to address inequalities, is very promising.”  

Simon Roberts, Chief Executive of Sainsbury’s, said: “As one of the UK’s largest employers we put our colleagues at the heart of everything we do. We see the clear link between engaged, motivated colleagues and business performance and that is why we have increased colleague pay by over 50% in the last 5 years.

“We share the Government’s vision of making work pay, enabling growth and driving productivity. We welcome today’s announcement and Government engagement with business to date and look forward to seeing progress on business rates reform, which would deliver real benefits for our colleagues, customers and communities.” 

Peter Cheese, Chief Executive of CIPD, the professional body for HR and Learning & Development professionals, said: “We share the Government’s ambition to raise employment standards and job quality through the Employment Rights Bill as part of the wider Make Work Pay agenda.  

“The changes being proposed represent the greatest update in employment legislation in decades. We’re pleased to see the ongoing commitment from Government to engage with the business community to work through the important details to ensure they have a positive impact for both employers and workers.” 

Jemima Olchawski, CEO of Fawcett Society, said: “Today’s draft employment bill is a win for women. Fawcett and our members have campaigned long and hard to see government chart a new course for inclusive economic growth and to improve women’s working lives.

“We share this government’s ambition to ensure all women can thrive at work and fully contribute to the economy.”   

Mark Reynolds, Mace Group Chair and Chief Executive, said: “Ensuring British workers are supported with strong employment rights benefits everyone – employers as well as employees.

“This package of reforms is a welcome insight into the Government’s plans and show that they have engaged extensively with businesses and taken a pragmatic approach. We’re pleased to support it; both on behalf of Mace and the wider construction industry. We look forward to working closely with the Government as they take these plans forward.”  

Brian McNamara, CEO of Haleon, said: “It is crucial that the Government continues to engage with the business community on such an important piece of legislation and we welcome the dialogue to date.

“Haleon is committed to creating an inclusive culture that provides all employees with equal opportunities.  This is central to our company strategy and will be core to our future success.” 

Greg Jackson, CEO of Octopus Energy, said: “In formulating these proposals it’s clear that the government has listened to both workers and employers to create protections against bad practices while enabling good businesses to invest in growth and training.

“For example, the probation period will allow progressive employers to give a chance to people without typical experience or educational backgrounds, opening up new opportunities for them in great careers.” 

Chris O’Shea, CEO of Centrica, said: “As the largest Unionised workforce in the energy sector, we are pleased to see the Government publish their landmark legislation providing more rights and flexibility to employees. 

“At Centrica, we offer a range of policies to support our 21,000 colleagues including flexible working and health and wellbeing support from day one, a leading 10 days paid carers policy, our Pathway to Parenthood which offers comprehensive financial support towards fertility treatment alongside paid leave to for any fertility, adoption or surrogacy appointments, and additional support for neurodivergent colleagues.

“It’s the right thing to do and we want to help our employees and share best practices with others. Our experience shows that there is a clear business case for doing this with savings from increased retention and ensuring colleagues don’t have to take unplanned absences.” 

Helen Dickinson OBE, CEO of the British Retail Consortium, said: “As the country’s largest private sector employer, employing three million people, the industry stands ready to work with government to ensure these reforms are a win:win for employers and colleagues, and maximise employment opportunities, investment, and growth.

“Many of the expected provisions, including stopping exploitative contracts and offering flexibility in employment, are things that responsible retailers already do. Introducing these standards for everyone means good employers should be competing on a level playing field.

“We look forward to engaging the government on the details, including around seasonal hiring and the use of probation periods.” 

Kate Nicholls, CEO of UKHospitality, said: “I’m pleased the Government has recognised the importance of flexibility to both workers and businesses. This is crucial for hospitality, which employs 3.5m people and provides countless flexible roles for working parents, students, carers and many more. 

“We look forward to continuing our engagement and consultation with the Government on its plans, which are not without cost, to get the details right for all parties.” 

A BT Group spokesperson, said: “BT Group believes that a strong economy is one that works for everyone, and has already adopted many of the measures that will be covered by this legislation.  

“It will be crucial to get the details right, to avoid unintended consequences and keep the UK competitive, and we welcome the constructive, consultative approach that the Government is taking.”

Not all employers’ organisations are rejoicing, however. The Federation for Small Businesses (FSB) says the legislation will be devastating for the industry.