There were two main areas specifically mentioned in the King’s speech:
- Draft legislation will be published on race equality for equal pay. Although it was not said in the speech, it is understood this will be a bill introduced that will make it mandatory for businesses with 250 employees or more to report their pay gap on race and disability. This will see increased work for medium to large employers and visibility of what are expected to be difficult distinctions.
- The new deal will ban exploitative practices for workers. Although it was not said in the speech itself, it is understood this is to give workers the right to have a contract that reflects the number of hours they regularly work based on a 12 week reference period and introduce compensation proportionate to the notice given for any shift/working time changes. It is not yet clear whether this means a ban to all zero-hour contracts, the use of the word “exploitative” suggests that they may allow zero-hour contracts where the worker also wants that flexibility. However, what this could mean for employers is a reduction in flexibility (particularly for those employers where it is difficult to predict resourcing demands) and possibly a rise in the use of agency workers, which would mean increased costs for employers.
‘Enhancing employment rights’ was also mentioned more generally in the King’s speech, we are still awaiting the detail of the draft Employment Rights Bill, but based on the briefing note prepared for the Kin’s speech and Labour’s pledges, we can expect it to include:
- Day one right for unfair dismissal protection, sick pay and parental leave (subject to special rules for probation periods). The expansion in unfair dismissal protection will be a big shift for employers, particularly in their recruitment strategies and probationary periods, which they will need to apply more scrutiny to, to ensure they are hiring the “right” people from the outset. This could have a detrimental effect on ED&I initiatives in recruitment and see businesses and hiring managers reverting back to hiring people “like them” and who will fit into their “culture” because they may feel it is less risky.
- Replacing the governments “inadequate” code on ‘fire and rehire’ practices.
- Making it unlawful to dismiss a woman who has had a baby for 6 months after her return to work, except in ‘specific circumstances’.
- Removing minimum service levels for trade union activity and simplifying the process to statutory recognition. In practice, most businesses prefer to proactively deal with recognition of trade unions, rather than wait for the statutory procedure to kick in, however, some businesses had welcomed the minimum service levels as a way of providing certainty of being able to maintain essential services.
The Employment Rights Bill is expected to be introduced within the first 100 days of government (we expect around October time) and is expected to be the biggest changes in employment rights for decades. This might sound quite rushed, however, a bill does not necessarily mean it will become law within those 100 days, it will need to go through parliamentary scrutiny and receive Royal Assent before being passed as a law. It will be interesting to see the draft of the bill and how that develops through the legislative process.
