We’ll soon be seeing dramatic changes to employee rights – with amendments to zero hours contracts, sick pay and parental leave among alterations set to be in place by 2027.
Employment partners at Knights have been discussing the potential ramifications of the impending Employment Rights Bill – which is expected to gain Royal Assent by the end of the year.
John Wood, said it’s set to be the biggest change to employment rights in his lifetime: “The upcoming bill has a variety of changes which are generally beneficial to employees – but these changes are extremely broad. We are not just looking at one aspect of employment law and it’s going to have a major impact on how we work – with a potential increase in pressure on employment tribunals as we anticipate a rise in claims.
“The tribunal system is already under huge strain and it’s taking claims longer to be processed - with it not being unusual for a final hearing to be listed more than two years after the initial claim is brought. Changes to the law, including the proposal to double the time employees can bring a claim from three to six months, will only increase this timeline and put an even greater strain on an overloaded system.”
Andrew Rowell works alongside John in the firm’s Leicester office. He says the impact of what’s coming will be felt across the board – not just in the tribunal system: “Employers of all shapes and sizes will be impacted. You could argue the bigger companies, with greater HR departments, will be able to take it in their stride a little more than those who don’t but there’s a lot more compliance and an awful lot more danger to face – regardless of who you are.
“Up until this point, employment law has been focused on individual employees working out that their rights have been offended in some way and then deciding whether to bring tribunal claims or not. Other than unions there’s been no real third party group policing these issues – but that’s going to change with the introduction of The Fair Work Agency (FWA).
“This could create significant ripples across sectors as you could find the unusual situation where the newly formed FWA brings a claim forward against an employer – regardless of whether the employee wanted to or not. That’s going to be big. Everyone will be affected by this as these changes will impact different area of business in different ways.”
Despite concerns over the widespread impact, John Wood adds there aren’t too many surprises despite there still being changes made as the legislation goes through Parliament: “We’ve been absorbing information on how this bill will look for a while now and Labour have seemingly kept in line with their promises as these headline targets have been part of their manifesto for some time.
“However, one extraordinary change which will have the biggest impact is the ‘day one right’ for unfair dismissal – which gives those with one day’s service the right to bring forward a claim of unfair dismissal.
“Since the concept of unfair dismissal was introduced in England, there has always been a qualifying service period for it – that has been somewhere between six months and two years. For that to be completely removed is a massive change.”
“I think it’s possibly the most unnecessary change that we will see as part of the Employment Rights Bill” says Andrew Rowell. “I think it’s been rushed through and, with a bit more thought, the Government could have come up with a midpoint – for instance, reducing the period required to bring a claim from two years of service to one year.
“The decision to completely eradicate it is going to be significant as employers will find it much harder to terminate someone’s employment in the first few months, with probationary periods practically being abolished. Despite this, there’s still some doubt over whether this part of the new legislation will materialise – with its introduction pushed back following criticism from the business world.
“Should it go ahead, an unintended consequence of it could well be that organisations simply stop recruiting. An increase to National Insurance contributions and a rise in the national minimum wage in recent months have been two of the larger obstacles put at the feet of business owners and I could see a reality where any further changes could lead to businesses not seeing recruitment as a viable option. This would completely go against the Labour government’s desires to protect and enhance the job market.”