Today, the Labour Government published its long-awaited Employment Rights Bill (the Bill), aimed at upgrading the rights of workers, addressing the issues of “one-sided flexibility” in the workplace, and improving work and financial security. The Bill is a big step towards fulfilling Labour’s promise to make sweeping changes to rights at work and improve pay.

Here are the main provisions contained within the draft legislation (although much of it may take 1-2 years to consult on and implement):

Day-one rights

One of the most significant changes is the removal of the existing two-year qualifying period for protection from unfair dismissal. We’re told this will be followed by a consultation on the rules to be applied during a probationary period.

The Bill also introduces more family friendly benefits for workers including removing qualifying periods and putting in place entitlements to bereavement, paternity and parental leave from day one. A full review of parental-leave rights is promised alongside the Bill.

Flexible working & family friendly rights

The Bill also proposes to make flexible working the default position “where practical”, with the aim of trying to redress the balance between the worker and the employer.

The Bill increases the obligations on larger employers to be proactive in addressing gender pay gaps. We will also see increased protections for pregnant women and new mothers, most notably by preventing dismissal within 6 months of an individual returning to work following maternity leave. This comes alongside increased support for those going through menopause, with the aim of enabling people to return to work and remain in employment for longer.

Zero-hour contracts & Fire and rehire

One of the Bill’s key changes will be to prevent “exploitative” zero-hours contracts and fire and rehire practices. Individuals on zero-hours contracts will gain guaranteed hours if they want them. Those workers and those on low hours contract will have the right to a guaranteed-hours contract if they work regular hours over a defined period, which Labour’s original proposal said would be 12 weeks. Employees can request to remain on a zero-hours contracts if they wish. Fire and rehire practices will be banned in all but extreme circumstances. This means that employers cannot fire employees and hire them on worse terms and conditions.

Classification of workers

Employment status and the classification of workers is a notoriously complex aspect of the law which often gives rise to a number of disputes. Currently, the UK operates on the basis of a three-tier system in which individuals are categorised as employees, workers or self-employed, each of which has its own accompanying rights and entitlements. The Government intends to consult on moving to a two (rather than 3) tier arrangement of self-employed individuals and workers.

Sick Pay

Workers will also see changes to the way in which statutory sick pay (SSP) is paid, including no lower earnings limit and the removal of the three day period that workers are currently required to wait before their entitlement to SSP kicks in. There will be an entitlement to SSP from day one rather than day four.

Enforcement

Finally, the Government has promised to establish a new Fair Work Agency, which will incorporate several Government enforcement bodies, with a view to enforcing holiday and sick pay correctly. The intention is to create a distinct organisation that employees can approach for assistance, and which can support employers in compliance with their obligations.

Minimum Wage

The Government plans to tackle low pay by accounting for the cost of living when setting the National Minimum Wage and removing age bands that set lower minimum wages for younger staff.

Beyond the Bill

As part of its Make Work Pay Plan, the Government has also published a Next Steps document detailing the reforms it will be consulting on moving forwards, including:

• The Right to Switch Off, which would prevent employees from being contacted out of hours;
• Expanding the Equality (Race and Disparity) Bill to mandate large employers to report their ethnicity and disability pay gap;
• A transition to towards a single status of worker with the aim of simplifying employment status and associated rights (see above); and
• A review of the parental leave and carers leave systems.