Employment Rights Bill introduces significant reforms for workers and employers
The much-anticipated Employment Rights Bill was published on 10 October and introduces 28 employment law reforms, including in relation to zero-hours contracts, fire and rehire practices, and establishing new day-one rights for workers.
Key reforms explained
In October, just within its self-imposed 100-day deadline, the Government published its long-awaited Employment Rights Bill. Schools need to be aware of these developments, as they will impact various aspects of staff management, contracts, and workplace practices.
The Bill is a lengthy document which will now undergo parliamentary scrutiny as it is considered and debated by both the House of Commons and the House of Lords. The second reading of the Bill took place on 21 October and it is now at Committee stage. The Committee is expected to report to the House of Commons in January 2025.
Some of the key reforms contained in the Bill are explained below.
Day one employment rights
A key change is the repeal of the two-year qualifying period for ordinary unfair dismissal claims. The Bill will instead grant unfair dismissal protection from the first day of employment. The Bill also provides for regulations to set out an "initial period of employment" (or a statutory probationary period) during which a modified version of the right to unfair dismissal will apply.
During the statutory probationary period, a more streamlined process for dismissals is anticipated. Schools will be able to dismiss employees using a "light touch" procedure, which could involve a meeting where concerns are explained, and the employee would have the right to be accompanied. However, the exact requirements and interplay with the Acas Code of Practice are still to be defined in the forthcoming regulations.
Crucially, the lighter process will not be available for all dismissals. It is expected to apply only where the principal reason for dismissal relates to the employee's capability, conduct, illegality, or another substantial reason directly connected to the employee (not including redundancy or restructuring under SOSR).
The length of the statutory probationary period is to be subject to consultation and then confirmed in regulations. The government has said it currently favours a nine-month statutory probationary period. In practical terms, this will mean that schools will be able to fairly dismiss employees within the statutory probationary period, although they will need to follow some form of process in order to do so. As with the length of the statutory probationary period, the form of the process will be confirmed in future regulations. The Government has confirmed that it expects these changes to take effect in Autumn 2026 at the earliest.
In order to prepare for these changes, schools will need to carefully consider how to manage staff during the probationary period. While there will be greater flexibility to dismiss within this period, it will still require establishing one of the permitted reasons and following a defined process that will be confirmed in future regulations.
Zero hours contracts
The Bill strengthens rights for workers on zero-hours and low-hour contracts by requiring employers to offer guaranteed hours if a worker consistently works more than their contracted hours over a set reference period (the length of which is to be confirmed in regulations).
In addition to the requirement to offer guaranteed hours to qualifying workers, the Bill also requires school employers to give zero-hours workers reasonable notice of shifts (to include specification of the date, start time and number of hours to be worked) that the school requests or requires the worker to work. Schools will also have to give reasonable notice to cancel or curtail shifts or make any changes to the day or time of the shift. Zero-hours workers will also be entitled to compensation for qualifying shifts which are cancelled at short notice. Again, the devil will be in the detail here, as what will constitute "short notice", as well as the amount to be paid in the event of a shift cancellation, is to be specified in regulations.
The duty to provide reasonable notice of shifts and of cancelled or changed shifts will not apply to shifts worked by agency workers, although there is provision for regulations to be made to include them and the Government is currently consulting on how these measures should apply to agency workers. Further consultation on the general implementation of the zero hours provisions of the Bill is expected in the future.
As the Bill progresses, schools are likely to need to consider how these changes will affect their engagement of zero-hours staff, particularly where flexibility is needed, such as during peak times or for last-minute cover.
Flexible working
The Bill will make it harder for employers to refuse requests for flexible working. The grounds for refusal will remain the same, but where a flexible work request is refused, the employer will be under a statutory obligation to explain the exact basis for its decision, which must be objectively reasonable. The Bill also creates the power for regulations to be passed setting out the steps a school would need to take in order to comply with the existing requirement to consult the employee before rejecting a request.
Family leave
The Bill removes qualifying periods for paternity and parental leave, granting employees these rights from day one. Additionally, the Bill introduces new flexibility, allowing paternity leave to be taken after shared parental leave, so that the entitlement is not lost where shared parental leave is taken first, as it currently is.
Workplace harassment
The Bill introduces a duty for employers to take all reasonable steps to prevent workplace sexual harassment, including harassment by third parties such as customers or clients. The last government attempted to introduce the same level of protection, but that Bill (now the Worker Protection (Amendment of Equality Act 2010) Act 2023) was watered down by the House of Lords before it passed into law. In terms of the practical effect of this reform, the duty to take reasonable steps to prevent workplace sexual harassment came into force on 26 October as planned. The new Bill highlights the direction of travel in this area and underlines that this will continue to be an area of priority for the government. If these provisions of the Bill pass unchanged into law, school employers will in future be held to even higher standards in respect of the protection of staff from workplace sexual harassment.
Insight into the government's long-term plans
The Government has also published a Next Steps to Make Work Pay document, which provides more detail on its plans to reform employment law beyond the Bill. Subject to consultation, the Government is considering introducing a 'right to switch off' through a statutory Code of Practice, This would prevent employees from being contacted out of hours except in exceptional circumstances.
There are also plans to address pay discrimination by requiring large employers to report their ethnicity and disability pay gaps. This will be achieved through the Equality (Race and Disability) Bill which will be introduced in Autumn 2024.
The Government also intends to embark on a number of consultations, including on a new employment status framework, under which there would be only two statuses: that of 'worker', and the genuinely self-employed.
Supporting schools to prepare for change
The Employment Rights Bill is a substantial document with numerous reforms, many of which will require detailed regulations to bring them into effect. With 28 individual reforms, there is a lot of information for schools to absorb. We will continue to monitor the Bill’s progression and provide updates on the key areas of focus. As further details emerge, we will provide practical guidance to help employers prepare for these significant changes.
It is important to note that the Bill still requires parliamentary approval and will not become law immediately. The government plans to consult on many of the reforms in 2025, with the most significant changes expected to take effect no earlier than 2026.