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Proposal
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Commentary
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What this means for employers?
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Day 1 rights
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Workers to have the right to claim unfair dismissal from day 1 subject to appropriate probation periods.
Workers to have the right to SSP from day 1 and without the current 3 qualifying days.
Workers to have the right to parental leave from day 1.
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Increased risk, Employment Tribunal claims and cost when dismissing workers: employers will have to follow fair processes before such dismissals to mitigate these risks.
Increasing costs in operating SSP arrangements.
Increased costs and need to cover workers taking parental leave.
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Banning exploitative zero hours contracts (ZHCs)
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This is not a proposed absolute bar on ZHCs, it applies to exploitative contracts and will be a right to have a contract that reflects the number of hours they regularly work, based on a twelve-week reference period.
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What exploitative means is yet to be defined. However, it is likely that it will include contracts where an employer does not guarantee any hours will be provided but the worker must be available for any work that is offered.
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Introduce a single status of worker
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Currently people who work fall into one of three different categories: employee, worker or self-employed and each category has different rights and protections. Labour intend to move towards a simpler two-tier framework: worker or genuinely self-employed. Workers will have all the employment rights, many of which are currently only available to employees.
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A substantial extension of the floor of employment rights to workers with the costs and risks that involves. It is unclear how this will interact with the different ways workers and employee are taxed or how "worker" will be defined.
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Fire and rehire only lawful to ensure a business remains viable
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Fire and rehire is the practice of an employer dismissing an employee and then re-engaging them on different terms and conditions. Despite earlier indications, Labour does not intend to ban this practice altogether, however, it will limit its use to situations where there is genuinely no alternative and is required to ensure the business remains viable and preserves its workforce.
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Less flexibility for employers to use dismissal and re-engagement to achieve changes to terms. However, our experience is this practice is very rarely used. It remains to be seen how "business viability" is defined and how much uncertainty there will be over whether employers are able to rely on this exception to dismiss and re-engage.
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Making it easier to raise grievances
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Employees would be able to raise collective complaints or grievances externally to Acas. Labour says this will be in line with the existing code for individual grievances, however, under the code individual grievances must be raised with the employer.
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For the first time, grievances can be raised with Acas. It is unclear whether Labour intends Acas to then have a role in addressing such grievance, Acas involvement would kick against the principle of grievances being internal matters between employers and employees.
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Strengthening redundancy rights
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Labour intends to strengthen redundancy rights and protections, for example, by ensuring that collective consultation requirements will be triggered if redundancies reach a defined threshold across the business as a whole, rather than within a particular workplace.
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This will be a significant change for large employers with multiple sites and is likely to result in more collective consultation being required.
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Strengthening TUPE rights
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Labour has stated it will strengthen these rights but has not set out how it proposes to do this.
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In the absence of detail it is difficult to comment on how this proposal will affect employers.
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Protection of whistleblowers strengthened
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This proposal includes updating protection for women who report sexual harassment at work.
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It appears the "protected disclosure" definition will be extended. In reality we consider this is likely to have modest implications for employers already alert to the importance of respecting and protecting women who report workplace sexual harassment.
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Increasing the time limit for bringing Employment Tribunal claims
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All employment rights will be subject to a six month time limit, not three.
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A longer time limit is likely to contribute to increasing Employment Tribunal claims. With Acas early conciliation included employees will have seven or more months to bring a claim from the act they complain about.
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Introduction of a Single Enforcement Body
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Labour intends to establish a single enforcement body to enforce workers' rights (including discriminatory practices against migrant workers). This body would have the authority to inspect workplaces and bring civil proceedings in the hope that would take some pressure off the Employment Tribunal system.
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This proposal will introduce a further layer of regulation as employers will potentially be engaging with this enforcement body as well as or instead of defending an Employment Tribunal claim.
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Extending the rights of women on maternity leave
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Labour will make it unlawful to dismiss a woman who is pregnant for six months after her return, except in specific circumstances (which are not defined).
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Employers will need to be scrupulously careful about not dismissing women in the six months after their return from maternity leave. In the absence of detail on the exceptions to this proposal we cannot comment on how applicable they may be.
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Duty to take all reasonable steps to prevent sexual harassment
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Labour intends to extend the current duty to take reasonable steps to all reasonable steps. It also intends to change the law on sexual harassment to protect workers from harassment by third parties.
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This proposal will place greater responsibilities on employers to safeguard its workers against sexual harassment, whether from colleagues or third parties.
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Introduce a Race Equality Act
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Labour intends to introduce a new law to establish the right to equal pay for Black, Asian and other ethnic minority people and strengthen protection against dual discrimination.
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Under the Equality Act it is already unlawful to pay someone less because of their race. There is also the potential to claim dual discrimination. In the absence of detail it is difficult to comment on how this proposal will further impact employers.
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Equal pay reporting
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Labour plans to extend pay gap reporting to ethnicity and disability (for employers with more than 250 staff) and amend gender pay gap reporting to require the publication of action plans and that outsourced workers' data is included.
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This will increase the pay gap reporting burden significantly for large employers, both in terms of reporting and producing action plans.
We await further details on how "ethnicity" and "disability" will be categorised for reporting purposes.
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Flexible working
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Flexible working would be the default from day one for all workers, except where it is “not reasonably feasible".
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This is a gear change which is likely to limit employers' discretion to refuse requests for flexible working.
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Giving workers a "right to switch off"
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Labour will introduce a new “right to switch off". This is intended to promote a positive work-life balance so the lines are not blurred between work and home life.
Labour have said they will following existing models in Ireland and Belgium, which have softer regulation than in France.
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Some employers use group chats for team communication. The proposed right to switch off from work based communication outside of working hours could pose challenges to flexible arrangements.
Workers and employers would be encouraged to work together to agree bespoke workplace policies or contractual terms that benefit both parties.
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Bereavement leave
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Labour will introduce the right to bereavement leave for all workers.
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Many large employers will already have bereavement leave in place for employees. The precise impact of this proposal will depend on how much leave entitlement will be introduced.
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Paid carers' leave
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The right to unpaid carers' leave came into force in April 2024. Labour have said they will consider the benefits of introducing paid carers’ leave, being mindful the impact of the change on small employers.
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Were this to be introduced it would lead to increased costs and need to cover workers taking carers' leave. There is likely to be more take up of the right if it is paid.
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Genuine living wage
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Labour want to ensure the National Minimum Wage (NMW) is a real living wage that people can live on. To achieve this, they would change the Low Pay Commission’s remit so that alongside median wages and economic conditions, the minimum wage will reflect the need for pay to take into account the cost of living. They will ensure this is properly enforced, including penalties for non-compliance.
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Increased wage costs.
This proposal will not need any primary legislation to come into force. Instead Labour will write to the Low Pay Commission to put this into effect, so this is likely to be introduced quickly.
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Removal of NMW age bands
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In addition, Labour will remove the 18-21 age bands to ensure every adult worker will be treated the same in respect of the NMW.
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Increased wage costs, particularly for employers in the retail, leisure and hospitality sectors who engage young workers.
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Repealing Minimum Service Level and other industrial action laws introduced by the current government
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Labour plan to repeal recent Conservative trade union laws including minimum service levels during strike action, which gives the government power to set minimum service levels for key public services during strike action.
It also states it would repeal the regulations allowing agencies to provide replacement labour during strikes.
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Minimum service levels during strike action are currently in place for the railway, ambulance and border security services. The Conservatives intend to expand this to education, fire and rescue and education services.
The regulations allowing agencies to provide replacement labour during strikes have already been revoked by the courts as they were introduced without due process. However, the current government has been consulting in order to reintroduce the regulations in a legally compliant manner – so this promise by Labour would be to preserve the status quo.
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Changing the thresholds required to achieve statutory recognition to a simple majority of those voting
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Labour would simplify the process of statutory recognition and lower the threshold for a union to secure it. The process for trade union recognition and the law around statutory recognition thresholds would be amended by removing the requirement for at least 50% of workers to be in support of a union’s claim for recognition, and introducing electronic balloting.
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These changes will make it easier for unions to secure statutory recognition.
Employers who currently do not have a unionised workforce should anticipate that unions are likely to take advantage of the changes to seek recognition where they have material membership numbers.
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Giving unions a statutory right to access to workplaces to recruit members
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Labour would introduce rights for trade unions to access workplaces for recruitment and organisation purposes as long as this is done in a regulated and responsible manner, on appropriate notice.
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This is a significant change to the current limited rights of entry. Employers who currently operate in a unionised workforce are likely to see an increase in union activity and potentially an increase in membership.
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Requiring s.1 statements of terms and conditions inform workers of their right to join a trade union
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Employers would be under a new duty to inform new employees (via their written statement of particulars) of their right to join a union, and to regularly re-inform staff about that right.
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Employers will need to update their contracts / new starter paperwork and set up a process for routine notification of staff.
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