With the general election set for 4 July 2024, it’s hard to miss Labour’s headline-grabbing commitment that they will produce an Employment Bill bringing about sweeping changes within 100 days of power.

But what does the election really mean for employers? We summarise the known positions of the Labour and Conservative parties below.

The Labour party’s current position

Labour have produced an updated version of their ‘New Deal’ paper called “Labour’s Plan to Make Work Pay”, appearing to roll back on some of their initial promises. It seems that whilst they remain committed to producing an Employment Bill within 100 days, they now accept that most of their intended changes will require a “comprehensive consultation” with both employers and employee representatives prior to finalising the detail of such reforms. However, they do maintain that such changes will be a top legislative priority for an incoming Labour government.

Whilst Labour’s proposals are lengthy in number, they lack any significant detail at present, and it is therefore hard to say exactly what changes will materialise and what they might mean for employers. However, to assist employers with their understanding of the types of changes which may be introduced, we have summarised some of the key proposals below.

Employment law changes proposed by Labour

• Moving towards a single status of ‘worker’ and transitioning towards a two-part system for employment status of ‘workers’ and ‘genuinely self-employed’.
• Basic ‘day one’ rights for all workers including unfair dismissal protection, parental leave and sick pay (although it appears that there will still be some scope to dismiss during probationary periods).
• Banning “exploitative” zero-hour contracts and ensuring everyone has the right to have a contract that reflects the number of hours they regularly work based on a 12-week reference period, as well as compensation that is appropriate for shifts being cancelled or curtailed. (It’s unclear how this proposal sits with the new regime on the right to request a more predictable working pattern which was expected to be introduced in September).
• Ending “fire and rehire”, by reforming the law to provide effective remedies against abuse and strengthening the current government’s new Code of Practice (Labour appear to accept that it is important that business can restructure in some circumstances to remain viable).
• Making flexible working the default for all workers from day one, except where it is not reasonably feasible.
• Removing the lower earnings limit on statutory sick pay, as well as the waiting period.
• Making it clear that whether or not the collective consultation obligations are triggered in a redundancy situation is determined by the number of individuals impacted across the business rather than in the one workplace/establishment (reversing the ‘Woolworths decision’).
• Strengthening rights and protections on TUPE process.
• Strengthening protections for whistleblowing, including updating protection for women who report sexual harassment at work.
• Strengthening protections for self-employed individuals, including the right to a written contract.
• Reviewing parental leave, including ensuring that it is a day one right (Labour have committed to conduct this review within the first year of government).
• Making it unlawful to dismiss a woman returning from maternity leave for six months after her return to work, except in specific circumstances.
• Introducing a new right to bereavement leave.
• Creating a new ‘right to switch off’, similar to models in place in Ireland or Belgium.
• Working with relevant stakeholders to examine AI and new technologies and what they mean for workers, as a minimum ensuring that proposals to introduce surveillance at work would be subject to consultation and negotiation with trade unions or workplace representatives.
• Ensuring that the national minimum wage (NMW) is a real living wage that people can live on and removing the age bands for NMW (together with ensuring that their new enforcement body has the powers to properly enforce, including penalties for non-compliance).
• Strengthening the law on tips to ensure that workers receive their tips and that workers decide how tips are allocated.
• Banning unpaid internships, except where they are part of an education or training course.
• Introducing a new fair pay agreement in the adult care sector in a bid to tackle the recruitment and retention crisis facing the sector.
• Reinstating the School Support Staff Negotiating Body in England;
• Reforming trade union legislation to:
  • simplify the trade union recognition process and the law around statutory thresholds;
  • ensure those working in the gig-economy have a right to organise through trade unions;
  • create a new duty on employers to inform employees of the right to join a trade union and give unions greater access to workplaces for recruitment and organising;
  • introduce electronic and workplace balloting, rather than simply postal balloting;
  • repeal recently introduced minimum service levels during strikes;
  • ensure agency workers cannot be used to break strikes;
  • strengthen protections for trade union representatives; and
  • strengthen blacklisting laws, including outlawing the use of predictive technologies for blacklisting.
• Aiming to narrow the gender pay gap more quickly by requiring large firms to publish and implement actions plans to close pay gaps and requiring the inclusion of outsourced workers to be included in reporting.
• Introducing a regulatory and enforcement unit for equal pay to combat employment tribunal delays.
• Introducing mandatory publication of ethnicity and disability pay gaps for employers with more than 250 employees.
• Enacting the socio-economic duty, contained in section 1 of the Equality Act 2010, for public bodies in England.
• Requiring employers with more than 250 employees to produce menopause action plans to outline how employees are supported through menopause.
• Establishing a single enforcement body to enforce workers’ rights, including the ability to target employers and raise civil proceedings.
• Increasing the time limit to bring an employment tribunal claim from three months to six months.
• Modernising health and safety guidance for work in extreme temperatures.
• Requiring employers to maintain harassment-free workplaces, including when third parties are present.
• Strengthening the upcoming legal duty for employers to prevent sexual harassment from taking ‘reasonable steps’ to ‘all’ reasonable steps.
• Ensuring that equality and trade union recognition is valued in procurement process by mandating consideration of ‘social value’ when awarding public contracts and determining strategic suppliers.

What do Labour’s proposed changes mean for employers?

It is no exaggeration to say that the reform we may see under a Labour government has the potential to mark the biggest changes to employment law that we have seen for decades. The proposals are far-reaching and touch on almost every aspect of employment rights.

Some of the proposals are not a surprise and an almost direct response to the limiting of rights we have seen introduced by other governments – for example, the longer qualifying period for unfair dismissal, which was introduced by the then coalition government in 2012, or the significant restrictions placed on trade unions’ ability to strike, brought in by the Conservatives in 2016. These points remind us of the political (or perhaps social) nature of employment law.

Meanwhile other changes have been prompted by the evolution of case law and the impact it has had on workers, whether intentional or otherwise – for example, the ‘Woolworths decision’ referred to above, or the vexed question of employment status which has been brought to the fore by the gig economy and changes to how we work.

Other proposals – supporting employees through menopause, enhancing flexible working, addressing inequality in the workplace – are not that dissimilar to other parties and so are arguably less political in nature, but rather reflect topical issues that have increased in importance in the national psyche over recent years.

The Conservative party’s current position

Early indications are that we can expect a Labour government, but we can’t rule out the Conservatives returning to power. In stark contrast to Labour, the Conservative party have said very little about employment law, although we can gain insight into their intention from recent consultations. It seems likely that we’ll see some (if not all) of the following:

• Re-introduction of employment tribunal fees – see here for more info.
• A law providing that confidentiality clauses are unenforceable if they prevent victims from reporting a crime to certain bodies/regulated individuals.
• Limitation of non-competes to three months post termination of employment.
• Reforms to TUPE to confirm that: (i) only employees, not the wider category of workers transfer; and (ii) that where a business is transferred to multiple employers, contracts of employment cannot be split between such transferees, but rather the transferees must agree who will take the relevant employees (there is no detail in the consultation about what will happen where agreement is not possible, however).
• Abolition of European Works Councils (EWC) remaining legal framework, including repeal of the requirement to maintain existing EWCs (following Brexit, the ability to form a new EWC ceased but there was a requirement to maintain existing EWCs which has been the subject of litigation and uncertainty).
• Reform of the fit note system, looking at how they can enable those with long-term health conditions to access timely work and health support.

And let’s not forget planned changes that the Conservatives were working on when the election was called, that we assume will continue. Prior to prorogation the Paternity Leave (Bereavement) Act 2024 was pushed through, providing a right to paternity leave in cases where a mother, or a person with whom a child is placed for adoption, dies. The Code of Practice on dismissal and re-engagement will be effective from 18 July 2024 and the new tipping law is due to come into force in October. We also have the right to request a more predictable work pattern planned for introduction in September, and neonatal leave next year.

The new duty to prevent sexual harassment will also come into force in late October and we are expecting guidance and an updated Code of Practice from the European Human Rights Commission to assist employers to determine how to comply with the new duty. Labour have said that they would strengthen this protection as noted above so it appears likely that this change will go ahead in its current or a strengthened form regardless of who gets into power.

Conclusion

It will be very interesting to see what happens over the coming months and what these changes will mean for employers. We are still awaiting the publication of both parties’ manifestos and will no doubt receive further detail of the proposed reforms throughout the election campaign.  At present, we have more questions than answers and a lot to debate.

Ultimately what changes will materialise in practice could vary significantly, and it is reasonable to assume that what we may end up with will likely be a watered-down version of the bolder pre-election promises, regardless of which party takes power. It is, nevertheless, an exciting time for HR professionals and solicitors alike, and reminds us of the forever-changing nature of the employment law landscape.

We will continue to monitor the situation as it evolves and keep you informed.

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