Post-election employment law changes - what will Labour do?

Labour’s proposals for employment law changes include:

• Unfair dismissal rights from day one. This is the biggest reform that has been announced. It will be the first time that there have ever been unfair dismissal rights triggered from day one of employment. 
  
  It has been qualified that this change “will not prevent fair dismissal, which includes dismissal for reasons of capability, conduct or redundancy, or probationary periods with fair and transparent rules and processes.” This appears to confirm that there will of course still be the possibility of dismissing someone fairly, for example where they have not been performing well. The probationary period will be the time to assess the employee’s performance and provided that there has been a ‘fair and transparent’ process we would expect an Employment Tribunal to conclude that their dismissal will not be unfair.  
  
  However, the difference will be that currently there are no requirements to show fair procedures have been applied (in respect of employees with less than two years’ service). Provided that there has been no bias on grounds of a protected characteristic or an automatically unfair reason behind the dismissal there will be no risk of a successful claim. That position will be turned on its head. 
  
  It will become more important than ever to have in place policies and procedures that clearly set out standards that are required in relation to performance and conduct from day one. There will also need to be clear processes to follow which management must ensure they follow to deal with breaches of these standards. It is likely that policies need to be reformed and management training updated. It will also put further pressure on the recruitment side; making sure that all reasonable steps are taken to ensure that you’ve got the right candidate for the role will be even more important.  
• Extending the time for submitting claims to the Employment Tribunal from 3 months to 6 months. This will also likely increase the number of claims although if the extra period is used for a longer pre-claim period to settle disputes and avoid proceedings it may not necessarily lead to more cases in the Tribunal.
• The right to redundancy consultation is to be determined by the number of people impacted across the business rather than in one workplace. This would be a very significant development. 
  
  This was the interpretation once applied to the collective consultation obligations under TULRCA in the Woolworths case. In that case the EAT held that the duty to collectively consult had been triggered when the number of employees in all the stores being made redundant was considered rather than any specific store. The decision was eventually overturned, and the legislation was confirmed as intending to trigger collective consultation obligations only if there were 20 or more proposed redundancies at an establishment not establishments i.e. a single location was to be considered not every location the employer carried out business. 
  
  If the law is changed to effectively say that there must be collective consultation if there are 20 or more dismissals proposed across the business, then it could lead to an almost-permanent state of consultation in larger multi-site businesses. 
• Amending the new duty to take reasonable steps to prevent sexual harassment to require employers to take ‘all’ reasonable steps and to protect employees from harassment by third parties. These elements of the legislation that is coming into force in October 2024 were dropped during the Parliamentary process due to concerns it would place too high a burden on business.
• Providing a right to flexible work from day one unless it is not ‘reasonably feasible’. Whilst there is already a right – since April 2024 – to make a request from day one this suggests that the onus will be on the employer to show reasons why the flexible work is not ‘reasonably feasible’. This is likely to lead to more disputes arising as to what exactly that means.  
• Banning zero hours contracts, ensuring everyone has the right to have a contract that reflects the number of hours they regularly work, based on a 12-week reference period. This might not mean that there is absolute ban but that individuals may request a contract to reflect what hours they regularly work. Could this in fact result in fewer hours being offered to zero hours workers?
• Ending ‘fire and rehire’ and ‘fire and replace’ through reforms to the law to provide effective remedies against abuse replacing the ‘inadequate’ statutory code brought in this year. This change might be more difficult to implement as in practice there is no practical way of prohibiting dismissal in this type of situation without it potentially forcing an employer into undertaking a redundancy exercise, leading to job losses with offers of alternative employment being made, thereby achieving the same end result as ‘fire and rehire’ albeit by a different route. 
• Removing restrictions on trade union activity and repealing laws that restrict the right to strike in relation to minimum service levels or that allow agency workers to cover strikers’ duties. Allowing for ballots to be conducted by electronic voting rather than by post.
• Ensuring unions have reasonable rights to access workplaces for recruitment and organisation purposes and simplifying the process for union recognition e.g. removing the current requirement for minimum levels of support to begin the statutory process. 
• Requiring that employers inform all workers that they have a right to join a union in the written statements that are given to all new starters.
  The above three measures will be part of the overall process to increase the role of collective representation in the workplace and to reduce the level of trade unions’ restrictions on industrial action.
• The publication of ethnicity and disability pay gaps will be made mandatory for employers with more than 250 staff, to mirror gender pay gap reporting.
• Reforming the calculation of national minimum wage rates to take into account cost of living and abolishing the age bands for adults; this will not increase the rate of the minimum wage but mean that it will be payable at the same rate for all workers aged 18 years and over.
• Extending sick pay rights to all by removing the lower earnings limit and waiting days. The rates of statutory sick pay may be low but the costs of this could easily accumulate, and it may lead to a stricter approach to absence being taken by management policies in cases of repeated short-term absence.
• Introducing a ‘right to switch off’ to ensure time limits are in place on working from home. Whether there will be any exceptions to this remains to be seen.
• Carry out full and detailed consultation on plans to move towards a single status of worker. This is not envisaged in the near future but if it is implemented will extend the full range of employment rights to all and likely increase the potential for claims.