General Election 2024: what would a win for Labour mean for employment law?

On 13 June 2024, Labour released its full manifesto, which confirmed that it would implement its Plan to Make Work Pay: Delivering a New Deal for Working People, which had been released weeks earlier. Below, we summarise the main proposals and what they mean for employers.

Commitments to change the law

·       Remove qualifying service requirement for certain rights such as unfair dismissal, sick pay, and parental leave.

·       Make Statutory Sick Pay (SSP) available for all workers and remove the waiting period. Rate of SSP to represent fair earnings replacement.

·       Make flexible working the default from day one for all workers except where it is not reasonably feasible.

·       ‘One sided’ flexibility of zero-hour contracts will be banned and those working regular hours for 12 weeks or more will have the right to a regular contract to reflect the hours worked. Workers to get reasonable notice of any change in shifts or working time and recompense for cancelled shifts.

·       Replace the statutory Code of Practice on Dismissal and Re-engagement (to be introduced on 18 July) with a stronger one and change the law to prevent workers being dismissed for not agreeing to a worse contract.

·       Give workers the full set of employment rights.

·       Employees will have the right to disconnect which means that employers cannot contact staff outside of working hours.

·       Give self-employed contractors the right to a written contract.

·       Remove the age bandings used currently for the National Minimum Wage and National Living Wage.

·       Introduce a specific ban on unpaid internships.

·       Require organisations with more than 250 staff to publish ethnicity and disability pay gaps.

·       Require employers to create and maintain workplaces and working conditions free from harassment, including by third parties.

·       Make it unlawful to dismiss pregnant employees for six months after return from maternity leave except in specific circumstances.

·       Require large employers with more than 250 employees to produce Menopause Action Plans.

·       A new duty on employers to inform the workforce of right to join a union in their written contract.

·       Extend time limit for bringing employment tribunal claims to six months.

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What would these changes mean?

One of the most significant changes proposed by Labour is the removal of the need for qualifying service for certain employment law protections and entitlements. Under a Labour government, employees would instead be able to access rights such as sick pay, parental leave and even unfair dismissal from the very beginning of their employment. Casual worker rights would also be reviewed and increased to give them a full set of rights.

The result of this would mean employers having to make changes to how they apply their policies and processes to employees with “short” service, rather than omitting some stages as can currently happen where unfair dismissal is not a concern. Employers would find themselves having to apply a full process to every procedure they follow. Providing these protections to workers will also remove much of the difference between these different employment statuses.

This, coupled with the proposal to remove the current limit on tribunal awards, would mean that the risk of unfair dismissal would become much more significant, and it could mean employers face an increased number of tribunal claims.

Under the Labour proposals, areas of the law that enable employers to be more agile with how they react to fluctuations in their business will also be lost. Labour promises to ban ‘one-sided flexibility’ in zero-hours contracts and require employers to agree to flexible working requests “except where it is not reasonably feasible”.

With fire and re-hire, Labour has identified three areas of the law that would need to be changed.

•           Information and consultation requirements to be improved to ensure employers consult with their workers on contractual changes.

•           Unfair dismissal and redundancy laws to be adapted to prevent dismissals for refusing to agree to a “worse” contract.

•           Changes to be made to trade union laws on notice and balloting to allow for defensive action where fire and re-hire is being implemented.

Finally, introducing the “right to disconnect” into UK law would bring the position in line with other countries, such as France, Spain and most recently Australia. Labour has promised to bring in rules that will allow workers to “switch off” and not be contacted by their employer outside of their contractual working hours. This could have significant implications for employers who are reliant on their staff picking work up outside of their usual hours and would likely require new policies to be introduced to set out this right for workers in individual businesses.