landlords

The King’s Speech: What Changes In Employment Law Are Coming?

The King has recently delivered his “Speech from the Throne” at the State Opening of Parliament, outlining the new government’s key aims for the year ahead, including proposed legislation. As part of this agenda, the Labour government is prioritizing employment law reform, as evidenced by the mention of two new employment Bills.

While the King’s Speech itself did not delve into the specifics of Labour’s proposals, the government’s accompanying background briefing notes (Briefing Notes) provide further insights. In this article, we will explore: (i) the key reforms highlighted in the King’s Speech and the Briefing Notes, (ii) the expected timeline for these reforms, and (iii) steps employers can take to prepare for these changes.

Key Employment Law Reforms

Employment Rights Bill

The Briefing Notes indicate that the Employment Rights Bill will apply to Great Britain and will be introduced within the first 100 days of the new government. It is described as representing “the biggest upgrade to workers’ rights in a generation” and aims to deliver on Labour’s “Plan to Make Work Pay.” Key points from the Plan, which may be included in the Bill, are:

  • Banning Exploitative Zero Hours Contracts: Ensuring workers have contracts reflecting their regular working hours and reasonable notice for shift changes, with compensation for cancelled shifts.
  • Ending ‘Fire and Re-hire’ Practices: Reforming the law to provide effective remedies and replacing the existing statutory code of conduct.
  • Day-One Rights for Workers: Making parental leave, sick pay, and protection from unfair dismissal available from day one, while maintaining probationary periods.
  • Strengthening Statutory Sick Pay: Removing the lower earnings limit and the waiting period.
  • Flexible Working from Day One: Making flexible working the default and requiring employers to accommodate it as far as reasonable.
  • Protecting Women Post-Maternity Leave: Making it unlawful to dismiss a woman for six months after returning to work, except in specific circumstances.
  • Single Enforcement Body: Establishing a Fair Work Agency to strengthen enforcement of workplace rights.
  • Fair Pay Agreement in Adult Social Care: Establishing fair pay and conditions in the adult social care sector, with potential expansion to other sectors.
  • Trade Union Legislation Updates: Removing unnecessary restrictions on trade union activity and promoting good faith negotiation.
  • Simplified Statutory Recognition Process: Ensuring workers and union members have a reasonable right to access a union within workplaces.

Draft Equality (Race and Disability) Bill

The draft Equality Bill aims to address inequality for ethnic minorities and disabled people by:

  • Equal Pay Rights: Enshrining the full right to equal pay for ethnic minorities and disabled people in law.
  • Mandatory Pay Reporting: Introducing mandatory ethnicity and disability pay reporting for larger employers (those with 250+ employees) to help close pay gaps.

Additionally, Labour commits to delivering a “genuine living wage” and removing existing age categories for the minimum wage, without requiring separate legislation. Reforms to the apprenticeship levy and the establishment of Skills England are also on the agenda.

When Are the Reforms Likely to Become Law?

Changes to the national minimum wage, such as altering the remit of the Low Pay Commission, could take effect as early as April 2025. However, the Employment Rights Bill and the Equality Bill will need to be drafted, debated, and approved by Parliament. Given Labour’s significant majority, these bills are expected to pass relatively smoothly, but secondary legislation and updated codes of practice will be required, potentially delaying implementation.

Extensive consultation with trade unions and businesses is anticipated, aligning with Labour’s commitment to collaborative policymaking. This consultation process may further delay the enactment of certain measures.

What Steps Can Employers Take to Prepare?

While no immediate action is required, employers should stay informed about the proposed changes. Key recommendations include:

  • Monitoring Developments: Keep an eye on updates regarding the specific details of the reforms.
  • Reviewing Equality Data: Start collecting and analyzing equality data to prepare for potential mandatory reporting.
  • Updating HR Systems and Policies: Anticipate changes to employment law and ensure policies and procedures are up-to-date.
  • Training Managers: Prepare managers for new employment law requirements, such as day-one unfair dismissal rights and fair dismissal procedures.
  • Considering Union Representation: Assess the potential impact of increased trade union activity and statutory recognition on your organization.

We will keep you updated on further key developments. In the meantime, please contact us if you have any questions or queries about how the proposals in the King’s Speech might impact you as an employer.