King's Speech announces two new employment law Bills

Manifesto commitments reflected in speech

During the election campaign, the Labour Party made no effort to hide its plans to introduce significant employment law changes. On the basis of what we learned during the campaign, the King's Speech contained little in the way of surprise. Two employment law Bills were announced. Whilst the Bills themselves are yet to be published, we now have some detail on what each is intended to include.

Employment Rights Bill

The Employment Rights Bill will apply to the whole of Great Britain and is due to be introduced by the middle of October.

The Government says the Bill will deliver policies set out in its New Deal document, including commitments to:

• Make parental leave, sick pay and unfair dismissal rights day one rights (although employers will still be able to use probationary periods)
• Ban 'exploitative' zero hours contracts. Workers will be entitled to a contract that reflects the reality of their regular working pattern. There will be a right to reasonable notice of shift changes and compensation for late notice cancellations
• Reform the law on fire and re-hire and replace the current statutory Code with a strengthened version. Employers should note that despite this commitment, the statutory Code of Practice on dismissal and re-engagement came into force on 18 July as planned
• Make flexible working the default from day one for all workers, with employers required to accommodate flexible working 'as far as is reasonable'
• Remove the lower earnings limit from the SSP framework
• Make it unlawful to dismiss new mothers for six months after their return to work, save for in specific circumstances
• Establish the 'Fair Work Agency' (single enforcement body) to strengthen enforcement of workplace rights
• Establish a Fair Pay Agreement in the adult social care sector, with a view to assessing whether such agreements could also benefit other sectors
• Reinstate the School Support Staff Negotiating Body, to establish national terms and conditions, career progression routes and fair pay rates
• Update trade union legislation including removing the previous government's approach to minimum service levels
• Simplify the statutory union recognition procedure

Draft Equality (Race and Disability) Bill

The territorial extent of this Bill is to be confirmed but it is again likely to apply across Great Britain.

The Government says that this Bill will:

• Extend the right to equal pay to equal pay for ethnic minorities and disabled people
• Introduce mandatory disability and ethnicity pay gap reporting for larger employers with 250 or more employees

What happens next

The King's Speech is currently being debated in parliament, and a debate on the employment law aspects is due to take place on Monday 22 July. At the time of writing it is unclear when the Bills themselves will be published. Given that the Bill, when introduced, will be scrutinised, debated and possibly amended by both the House of Commons and the House of Lords, the legislative process is likely to take several months. We will continue to report on developments.

For more information or advice, please contact Jessica Scott-Dye in our Employment team on 0117 314 5652, or complete the form below.