Five key questions to the Employee Rights Act

Labor law experts suggest that the government will most likely publish the draft Labor Rights Act on October 10, making good on its promise to deliver the legislation (at least in draft form) within 100 days of coming to power.

Many of the likely features of the bill have already been hinted at, first appearing as promises in Labour’s election manifesto in its Blueprint for Making Work Pay, or New Deal for Working People.

Overall, the bill aims to tackle issues such as insecure work, low pay, first-day rights and worker exploitation. However, many questions remain about the exact details of the legislation, which will need to be subject to parliamentary consultations and votes before it enters into force.

We asked five key questions for HR regarding the Employee Rights Act:

What does ‘trial period’ mean in terms of rights from day one?

When the Employment Rights Bill was announced during the Royal Speech in July, it was confirmed that workers would have the right to unfair dismissal from day one “subject to a trial period”.

Since the introduction of unfair dismissal laws in 1971, the qualifying period has ranged from six months to the current two years, but there has never been any provision on the length of a probationary period.

In a briefing document accompanying the King’s speech, the government said that “we will continue to ensure that employers can use trial periods to assess new employees,” but did not specify how long that trial period should be.

“Multiple” Whitehall sources told the Financial Times last month that Deputy Prime Minister Angela Rayner and Business Secretary Jonathan Reynolds had set a maximum probation period of six months, but it is unclear exactly how this relates to the right to pursue unfair dismissal from as early as the first day. seen.

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When is a zero-hours contract ‘exploitation’?

Labor’s manifesto promised to end what it calls “unilateral flexibility”. It aims to provide greater security for workers in precarious jobs or on zero-hours contracts. The draft Workers’ Rights Bill is expected to include a ban on ‘exploitation’ of zero-hours contracts, a right to a contract reflecting the number of hours regularly worked and a requirement for appropriate notification of changes or cancellations to shifts.

However, there are few details yet on how the law will define exploitation. This can be a problem for employers in seasonal industries such as hospitality, where demand may mean changes to shift patterns at short notice or a sudden change in staff needed. IPSE, the membership body for the self-employed, argues that zero-hours contracts can provide “significant flexibility” for some workers who want to take on childcare responsibilities.

“Ultimately, whether zero-hours contracts qualify as exploitation should come down to whether the employee has the power to decide when to work,” it says. A complete ban on them would not eliminate unscrupulous labor practices by unfair employers, he adds.

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Will there be a “right to disconnect”?

Labor first broached the idea of ​​adopting a “right to disconnect” – whereby workers have the right not to respond to messages from their employer outside agreed working hours – in its 2021 Green Paper. This year’s election manifesto clarified that any right to disconnect will likely follow models similar to Ireland or Belgium. These stipulate that workers cannot be penalized or disadvantaged for refusing to work outside normal working hours.

Many countries have already introduced such regulations, most recently Australia, where employers who violate these rules face potential penalties. While such a law was not on the “shopping list” of reforms set out in the King’s Speech, it could feature in the upcoming draft legislation and subsequent consultations. The government has not made clear whether the Employment Rights Bill will contain direct statutory restrictions or a code of conduct, as is the case in Ireland.

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How will changes to sick pay work?

One of the key promises of the new government is to “strengthen statutory sick pay” by abolishing the earnings floor and abolishing the three-day waiting period for workers to receive it.

While workers will welcome the removal of the earnings floor – which the TUC says means 1.3 million people are not on SSP – there has been no indication yet whether the legislation will increase the current rate of £116.75 a week. This is only 18% of average weekly earnings, emphasizes the TUC.

If workers no longer have to wait to start SSP under the Employment Rights Act, they are more likely to take short-term sick leave, some say, while others suggest it could encourage employers to take a more proactive approach to managing shortages.

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What will happen to my employment status?

Seven years after Matthew Taylor recommended it in his review of modern employment practices, the Labor government has promised to reform the complex area of ​​employment status.

There are currently three categories of workers for employment law purposes (employees, employed and self-employed persons) and two categories of workers for tax purposes (employed and self-employed persons). In recent years, high-profile legal cases have determined whether a person is actually employed and therefore entitled to employment rights such as holiday pay and the minimum wage.

In its manifesto, Labor said it would “move to a simpler two-part employment status framework” and consult specifically on a simpler framework that “distinguishes between employees and those who are effectively self-employed”.

It also said it would look at how employee status is communicated and understood among employees so that individuals know where they stand in terms of rights and obligations. No consultations have been held yet, so it remains to be seen how this will work in practice.

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Personnel Today will examine the content and implications of the Employment Rights Bill as soon as it is introduced to Parliament.

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