What HR changes can we expect to see in the Employment Bill 2024?

The Labour Party manifesto that was published in the lead up to the general elections in the summer there were a number of employment law and HR changes set out that would have a significant impact for all employers if they are approved by Parliament. The pledge Labour make is to ‘modernise the world of work’, saying it does not reflect modern day working practices for families.

Since Labour’s Election on the 4^th July these proposals went into the Kings Speech and will now form the Employment Bill 2024 that is expected 100 days later, on the 16^th October 2024. This does not mean the laws change there and then, but they are likely to impact on Human Resource practices as soon as they have been passed through Parliament. Most can be expected from April 2025, with others imparted in October 2025.

Here are the changes that the businesses I support and represent could expect to see from this year’s Employment Bill. Its not all that is expected, with a traditional overhaul and easing on trade union laws anticipated, but these are the headline for my client base.

1. Day one rights against dismissal

Employees currently have to wait 2 years before they get a statutory right not to be dismissed unfairly – requiring a recognised process and strong reason to dismiss. There are some exception around discrimination, whistleblowing and rights like working time which will remain as automatically unfair in the eyes of the law! While this does stifle movement into vacancies and career development, it does give employers great certainty and a long window to review and consider if an employee is right for their business.

What does this mean for employers?

Removing this 2 year provision fully will open the channels for worker movement, which can be good for growth and development but it will cause huge issues for employers in recruitment, induction and retention as well as protecting workers who don’t really fit within the role or culture of the business. A capped contractual probationary period has been suggested as the half way house for this very topical proposition.

The practice of ‘fire and rehire’ – by making a role redundant then re -hiring on lesser terms, is expected to be grounds for automatic unfair dismissal. When asked for help with redundancies I do make sure that redundancies are made for the right reasons and the process treats people fairly.

2. Guaranteed hours and removal of the zero hours contract

Labour sees this way of engaging workers as very one sided, is exploitative and only benefits the employer. A minimum number of hours per week, within a 12-week reference period, is expected.  Case law and working time regulations also dictate how irregular hours must be considered for pay, breaks and holidays.

What does this mean for employers?

Zero hours contracts are not that useful. There is no exclusivity, so employers don’t have that certainty when needed. More often than not a zero hours contracts turns into a full time equivalent, so why not just offer the full time contract from the start. Where there is flexibility in terms of the hours or period then a contract for a fixed term, or minimum guaranteed hours with overtime often works. It also shows the employee that there is some commitment to provide work and pay them, which usually motivates them to work for you.

In terms of guaranteed hours, the law already accounts for regular overtime in normal pay when it comes to holiday, notice and redundancy pay. It is often subject to pension as well, so why not ensue the guaranteed hours are what your business needs.

3. A single living wage

The current banding for the national minimum wage is irrational and detrimental to younger workers who probably have the same living costs as workers just a couple of years older than them. To have one rate of national minimum wage, set around the current top level that for propaganda reasons is called the ‘living wage’, is very likely.

An Apprentice rate may be a side to this one size fits all, but with a more general band for all Apprentices.

There is also a plan to ban unpaid internships as they are viewed as an exploitation of free working.

What does this mean for employers?

Clearly a bottom line impact on wages, national insurance contributions and pensions that needs to be accounted for in operating, overhead and profit modelling.

4. Sick Pay

Statutory Sick Pay is only available to those earning the lower limit that contributes to national insurance and after 4 days of continuing sickness absence, generally. Plans are to make SSP a day one absence right available to all regardless of earning levels.

What does this mean for employers?

I don’t think many people think about the pay qualification for SSP when considering time off, but they do seriously think about 3 days without any pay. This can create presenteeism for genuinely sick staff who can’t afford to not earn, but also deters lets say the less genuine of cases. Day 1 rights to SSP could increase short term absenteeism, impacting on productivity and service. More administration time will incur with the management of sickness, self-certification, return to work and monitoring. HR software could be the antidote to this.

5. Right to ‘switch off’

Many jobs are mobile, in that they could be completed from most places; work, home, holiday, abroad, weekends. It has become a cultural expectation and acceptance that we will all partake in work outside of our contracted remit. Psychologically people have become so connected with work that the can’t disconnect, which is proven to effect relationships, mental and physical health. A number of European countries have agreed with workers to reduce expectations and to give greater respect to home and personal life and the UK is expected to follow some kind of suit.

What does this mean for employers?

The expectation is that a more mutual agreement will generally be accepted between employer and colleagues. However, protection will be afforded if the employer still contends to have a right to communicate with the employee out of their contracted hours then the employer will not be able to lawfully treat them less favourably. Employees choosing to have a period to ‘switch off’ may also consider their commute to their regular place of work covered by this protection.

With a changing cultural dynamic in our employment market, new wave Gen Z workers will certainly look to preserve their rights away from work so employers too are advised to work with it.

6. Single status of worker – Genuine Self Employment

A worker is someone who does not work for another employer and current employment law affords two categories; an employee and a worker. An employee is generally recognisable; fair days pay for a fair days work, guaranteed hours, performance, trust and confidence. They also acquire a number of statutory rights; against discrimination and unfair dismissal, paid leave, sick pay, working time. A worker though is someone who falls between employment and being employed by another – typically called labour only sub-contracting. Most of my clients know this type of person, and they are often part of the furniture; trained, work wear, vehicle provision even paid time off. This happens because the law is so unclear. Workers also have some rights, against discrimination and for paid annual leave.

The Government believe self-employment workers are exploited…and don’t pay the right tax (which is an important motivation for any political party) and as such are looking to streamline the legal definition to Employed or Self Employed.

What does this mean for employers?

Some industries, namely construction, transportation and catering self-employment is a fundamental part of operational strategy. Where work is not consistent then the ability to change working patterns without cost is of paramount importance. That said, I do see exploitation and evasion – which is more often than not a mutually  agreeable arrangement. Change is needed, but perhaps say with a provision of no more than 100 days each rolling year as a parameter from which employment because the de-facto status.

7. Positive menopause support for female workers

For a very natural life changing event for most women why has it taken so long for the workplace to be considerate, supportive and accommodating? Employers with more than 250 staff will need to have a Menopause Action Plan, setting out their commitment to providing flexibility and support in the workplace, to ensure promotion is not overlooked, flexible working is consider, work environment and uniforms are comfortable and menopause related absence is considered with empathy.

What does this mean for employers?

I propose all employers consider how they can provide support, help and flexibility to women dealing with menopause symptoms. To ensure equality of opportunity is still give, while colleagues accept and help with environmental or operational changes. I will be recommending this positive change to all my clients, regardless of size.

8. Terminal Illness Charter

Terminally ill people still need to work and deserve security and decency during the hardest period of their live. It is a time that while coming to terms with their mortality they also want to ensure their loved ones are supported after they have passed.

A Charter will give best practice for employing workers with terminal illness to ensure they are treated with respect, dignity and support at work.

What does this mean for employers?

I have never had to advise on a terminal illness case where an employer has been unsympathetic, lacked empathy and case. That said, conversations about pay and continuing employment are very difficult. Employers have to balance a lot of things, and continuing operations is one. Very clear rights and expectations, in a Charter if necessary, clarify what the employee, and their family, can expect during the end of the life while at work.

Other things likely to be in the Employment Bill

For me these expected changes are the most common matters we at THSP support our HR and Employment Law customers with. Other changes, common to a Labour Government, include better protection for dependents care, including parental rights relating to child income support connected to pay and hours.

Whistleblowing laws protect persons making disclosures about issues that have an interest in the public domain. New sexual harassment laws already planned for this year extend greater rights for whistleblowing protection for people who have been sexually harassed. No more confidential ‘gagging’ orders.

The much-anticipated Employment Bill will be published mid-October this year, which will then follow the usual process of debate, refinement and final Royal Assent. So, no changes before April 2025 are expected, at the soonest.