The UK’s labour market stands at a crucial juncture. Rapid technological changes, shifting workforce trends, and ongoing economic pressures create both challenges and opportunities. As successive governments have acknowledged, these challenges require bold, innovative solutions. The long-awaited “Get Britain Working” paper, set to be released in 2025, outlines a comprehensive strategy to tackle economic inactivity and enhance employment levels, aiming for a more inclusive and resilient labour market.
Understanding the Landscape
British families are facing mounting financial pressures, with many experiencing job insecurities. To modernise the UK’s employment framework, the government has introduced the Employment Rights Bill, which proposes several key measures to improve workers’ rights and ensure fairer working conditions:
- Flexible Working: Flexible working arrangements will become the default for all employees, offering greater work-life balance.
- New Leave Rights: Bereavement leave and immediate access to paternity and parental leave will be introduced to better support families.
- Enhanced Protections: Strengthening rights for pregnant workers and ensuring more protections for new mothers returning to work.
A Shift Towards Co-operation
The Employment Rights Bill is the first phase of the government’s “Plan to Make Work Pay.” This initiative seeks to promote a more co-operative approach to industrial relations by repealing previous anti-union legislation and fostering collaboration between businesses, unions, and workers. It also aims to improve labour standards, tackle declining pay, and provide greater job security. While some reforms will require new laws, many can be implemented through secondary legislation or regulatory changes.
The Plan to Make Work Pay
This initiative is focused on addressing low pay, poor working conditions, and job insecurity. It aims to elevate workers’ rights while supporting businesses that prioritise fair treatment. Key components include:
- Adjusting the Minimum Wage: The Low Pay Commission will begin factoring in the cost of living in its minimum wage decisions, starting from April 1, 2025.
- Eliminating Discriminatory Age Bands: Ensuring equal pay regardless of age is central to eliminating age discrimination.
- Self-Employed Protections: New measures will protect the self-employed from late payments, enhancing financial security for independent workers.
Key Components of the Employment Rights Bill
The Employment Rights Bill lays the foundation for the “Plan to Make Work Pay” and introduces several crucial policies, such as:
- Day 1 Rights: All employees will have guaranteed basic employment rights from the very first day of their employment.
- Ending Exploitative Contracts: Zero-hours contracts without security will be prohibited, and businesses will be encouraged to adopt more stable working arrangements.
- Fair Work Agency: A new agency will be established to monitor and ensure fair work practices across industries.
- Fair Pay Agreements: The government will focus on improving pay conditions in sectors such as adult social care, as well as re-establishing negotiating bodies for support staff in schools and other sectors.
- Sexual Harassment Protections: Stronger protections for employees facing sexual harassment, alongside specific plans to address gender and menopause issues, will be put in place.
- Strengthening Statutory Sick Pay: There will be an increase in statutory sick pay rates, particularly for those earning below the current flat rate.
Family-Friendly Policies
The government is implementing several immediate changes to better support working families:
- Making Flexible Working Standard: Flexible working will be made the default, ensuring greater work-life balance for all employees.
- Introducing Bereavement Leave: Workers will have access to bereavement leave, offering crucial support during difficult times.
- Offering Day 1 Protections for New and Expectant Parents: New parents will have protections from day one of employment, which will include stronger parental leave policies.
- Reviewing Parental Leave Policies: The government will review and update the current parental and carer leave systems to make them more equitable.
Tackling Insecurity and Inequality
In line with the broader agenda to reduce workplace insecurity and inequality, the government is proposing several key reforms:
- Removing Age Discrimination in Pay Structures: Age-based pay discrimination will be eliminated, ensuring equal pay regardless of age.
- Ending Exploitative Zero-Hour Contracts: The government will aim to replace zero-hour contracts with “low-hour” contracts that offer more stability and fairness.
- Closing Loopholes in “Fire and Rehire” Practices: Measures will be introduced to protect workers from exploitative dismissal practices, closing the loopholes in current regulations.
- Providing Unfair Dismissal Protections from Day 1: The two-year qualifying period for unfair dismissal protections will be removed, providing more immediate job security.
- Consulting on a Unified Worker Status: The government will explore the possibility of creating a unified worker status, which would ensure equal protection for all workers, regardless of their employment type.
Strengthening Workers’ Rights
The government remains committed to reinforcing workers’ rights and giving employees a stronger voice in the workplace. Trade unions will play a crucial role in this effort, with plans to update related legislation to enhance their ability to negotiate and represent workers.
Next Steps Document
Following the implementation of the Employment Rights Bill, the government released a “Next Steps” document in October 2024, outlining future reforms based on consultations with key stakeholders. These include:
- Equal Pay Measures: Focus on ensuring equal pay across gender and demographic lines.
- Reporting Requirements: Large employers will be required to report on ethnicity and disability pay gaps.
- Enhanced Support for Disabled Workers: New measures will provide additional support for disabled workers in the workforce.
- The Right to Disconnect: Employees will be granted the right to disconnect from work after hours, promoting better work-life balance.
- Reviewing Parental and Carer Leave Systems: The government will review and update parental and carer leave systems to ensure they meet the needs of modern families.
The Road Ahead
The forthcoming reforms and the “Get Britain Working” paper represent significant steps toward creating a more equitable and secure labour market in the UK. By emphasising collaboration between businesses, unions, and workers, the government aims to implement these changes effectively and ensure that the labour market adapts to modern realities while safeguarding workers’ rights. Stakeholder engagement will be essential, with consultations on these reforms set to begin in 2025, with implementation expected by autumn 2026.
Does the employment rights bill affect your business and you’re not sure how to manage it? Let’s connect and we will help you navigate the changes together.
