Today's King's speech contained two employment related Bills, as well as a Skills England Bill aimed at reforming apprenticeships. There were no surprises. The commitments reflect the myriad reforms trailed by the Labour Party in their Plan to Make Work Pay (MWP) during the general election, and are hailed in the speech as "the biggest upgrade to worker's rights in a generation".
For a reminder of what was said in the manifesto and the implications of these reforms please see our election alert here.
Employment Rights Bill
The majority of the changes the new Government wish to make to employment law will be set out in a new Employment Rights Bill. The Government have committed to introducing this "within the first 100 days". The timings of when any of the specific changes will come into force remains unknown.
In detail the Employment Rights Bill will implement the manifesto promises which require changes to primary legislation namely:
- banning exploitative zero-hour contracts. The King's speech did not define exploitative, but provided slightly more detail than the manifesto noting that workers will have a right to a contract that reflects the number of hours they regularly work and that all workers get reasonable notice of any changes in shift with proportionate compensation for any shifts cancelled or curtailed.
- ending ‘Fire and Rehire’ and ‘Fire and Replace’ by reforming the law to provide effective remedies and replacing the previous Government’s statutory code, which the speech calls "inadequate".
- day 1 rights for all workers to parental leave, sick pay and protection from unfair dismissal Readers will be relieved that a commitment is made that legislation will ensure employers can operate probationary periods to assess new hires.
- strengthening Statutory Sick Pay by removing the lower earnings limit to make it available to all workers as well as the waiting period.
- making flexible working the default from day-one for all workers, with employers required to accommodate this as far as is reasonable.
- making it unlawful to dismiss a woman who has had a baby for six months after her return to work, except in specific circumstances. No definition is given of specific circumstances so we will need to wait and see when the exception will be applied.
- updating trade union legislation by "removing unnecessary restrictions on trade union activity" which specifically included the previous Government’s approach to minimum service levels basing industrial relations around good faith negotiation and bargaining. It is unclear whether this includes the full range of trade union legislation reform proposed by MWP, including strengthening the rights of union officials and members to take part in union activities. We anticipate these will be the subject of consultation and a further draft Bill in future.
- simplifying the process of statutory recognition and introducing a regulated route for a reasonable right to access a union within workplaces.
The changes to minimum and living wages (as detailed in our earlier alert) do not require primary legislation but the commitment to making changes have been restated in the King's Speech.
The changes Labour had proposed to make to the Duty to Prevent Sexual Harassment did not feature in the King's speech, presumably because the relevant Act has already received Royal Assent. For more detail about these changes due to come into force this October please see our alert here. The background briefing notes to the King's speech state that a quarter of reported sexual harassment in England and Wales takes place at work and nothing more.
As we anticipated, several of the MWP proposals do not feature in the King's Speech. Specifically:
- Proposals to strengthen redundancy rights.
- Introducing a single "worker" status.
- Giving workers a right to switch off.
In particular, the Labour Party had committed to fully consult on its proposed single "worker" status proposal and we anticipate it will do that. When it will do so is unclear at present.
Draft Equality (Race and Disability) Bill
The draft Bill addresses the manifesto commitments to make is easier for ethnic minorities and disabled people to bring equal pay claims by giving them "the full right to equal pay" and introduces mandatory ethnicity and disability pay reporting employers with 250 or more employees to help close the ethnicity and disability pay gaps.
Notably the Equality (Race and Disability) Bill is referred to as a draft bill. This suggests it will have a slower process through parliament; the bill is likely to be scrutinised by committee before being published. This is understandable as it will be a complex bill to draft and implement. Most employers will not hold all the data that will be required and so we will require further details on how "ethnicity" and "disability" will be categorised for reporting purposes.
What this means for employers
This King's Speech leaves employers in no doubt about the new Government's commitment to employment law reform and to achieve some of them at pace. Day 1 rights are likely to have the greatest impact on all employers, many of whom in our experience do not operate probation periods. Any reforms will need to make their way through Parliament. However, the impact of the reforms being set out in the manifesto means the House of Lords effectively loses any right of veto so the legislation is likely to pass through Parliament quickly.
We will keep readers updated on the detail of the changes as soon as we have more information.
