Compliance officers, take note: The U.K. government will be introducing two new bills in its next Parliamentary session that portend to have significant implications for employers.
In May, the Labour Party published its “ Plan to Make Work Pay: Delivering A New Deal for Working People,” outlining its plans to improve worker terms and conditions. These plans have now been incorporated into the U.K. government’s legislative agenda.
In a July 17 speech, King Charles III said that his government “will introduce a new deal for working people to ban exploitative practices and enhance employment rights.” This has been introduced as the Employment Rights Bill. A second proposed bill that will impact employers addresses stronger protections for minorities and those with disabilities.
Employment Rights Bill
As described in the U.K. government’s briefing notes, key provisions of the Employment Rights Bill include, in part:
- Banning “exploitative” zero-hour contracts, ensuring workers have a right to a contract that “reflects the number of hours they regularly work and that all workers get reasonable notice of any changes in shift with proportionate compensation for any shifts canceled or curtailed;”
- Ending “Fire and Rehire” practices by providing effective remedies and replacing the previous government’s “inadequate” statutory code;
- Making parental leave, sick pay, and protection from unfair dismissal available from day one for all workers;
- Strengthening protections for new mothers by making it unlawful to dismiss a woman who has had a baby for six months after her return to work, “except in specific circumstances;”
- Strengthening statutory sick pay by removing the lower earnings limit to make it available to all workers;
- Making flexible working the default from day one for all workers and requiring employers to accommodate this flexible working “as far as is reasonable”; and
- Updating trade union legislation by “removing unnecessary restrictions on trade union activity, including the previous government’s approach to minimum service levels, and ensuring industrial relations are based around good faith negotiation and bargaining.”
In addition to the Employment Rights Bill, the U.K. government stated in its briefing notes that it will deliver “a genuine living wage that accounts for the cost of living and we will remove the discriminatory age bands to ensure every adult worker benefits.” Additionally, a single enforcement body, called the “Fair Work Agency,” will be established to enforce workplace rights.
Draft Equality Bill
The draft Equality Bill will deliver on the U.K. government’s “manifesto commitments to enshrine in law the full right to equal pay for ethnic minorities and disabled people and to introduce mandatory ethnicity and disability pay reporting,” according to the briefing notes.
The draft bill proposes to tackle inequality for ethnic minorities and disabled people by:
- Enshrining in law the full right to equal pay for ethnic minorities and disabled people, “making it much easier for them to bring unequal pay claims;” and
- Introducing mandatory ethnicity and disability pay reporting for employers with at least 250 employees “to help close the ethnicity and disability pay gaps.”
The intent of the pay reporting for employers, according to the U.K. government, is to “enable companies to constructively consider why they exist and how to tackle them.”
Next steps
The U.K. government said it intends to “introduce” the Employment Rights Bill within the first 100 days, suggesting a draft will be ready by October. Before the bill can be signed into law, however, it must still go through the Houses of Parliament and could be further amended.
Many legal experts have commented that real change will not happen this year, leaving employers in a wait-and-see mode until the final texts of the Employment Rights Bill and the Equality Bill are released and the details are hashed out.
Considering what the U.K. government has already proposed, however, compliance officers and employers can proactively prepare by:
Reviewing and revising, as appropriate, policies and procedures on parental leave, sick pay, and unfair dismissal;
- Alerting employees to policy and procedural changes
- Consulting with lawyers on zero-hour contracts
- Fostering a healthy culture that values diversity, equity, and inclusion
Participation in the process is also encouraged. The U.K. government has stated that it will “work in close partnership with trade unions and business to deliver our New Deal and invite their views on how best we can put our plans into practice.”
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