07/03/2025
The Government has published an Amendment Paper to the Employment Rights Bill (Bill) following the recent consultations with businesses and trade unions.
Below is a whistle-stop tour of some of the key proposals.
Agency workers and zero hours contracts
This consultation related to agency workers and whether various measures proposed in the Bill should be applied to them.
The offer of guaranteed hours
The right to guaranteed hours will apply to agency workers (in addition to low and zero hours workers), meaning that agency workers will be entitled to be offered a contract that reflects the hours they regularly work. The Government has also confirmed that it will be the end hirer that will be obliged to make the offer, although future regulations could place obligations on agencies/other entities in certain scenarios. The Government believes that placing the obligation on the end hirer is appropriate as the end hirers are best placed to forecast and manage the flow of future work.
In response to concerns about seasonal or temporary work, the Government said that it understands that some work is genuinely temporary, and that it would not be appropriate to require businesses to provide qualifying workers with permanent contracts in those circumstances. The legislation will therefore permit flexibility, but this will be by exception.
Shift notice
Responsibility will be placed upon both the employment agency and the end hirer for providing an agency worker with reasonable notice of shifts. The Government has said that it recognises that either party may be responsible if they do not provide reasonable notice, and as a result, it wants to ensure that an Employment Tribunal can appropriately apportion liability. The Government also acknowledged that in some scenarios short notice may be reasonable.
Agency workers will also have the right to receive a compensation payment if shifts are changed at short notice. The responsibility for the short notice cancellation or curtailment payments will fall to the employment agency who will have to rely on any contractual arrangements with the end hirer to recoup the costs.
Contracting out
There is a new provision allowing for a collective agreement to contract out from the rights of guaranteed hours and reasonable notice to shifts. Employers and trade unions are able to agree different terms, so long as the terms are incorporated into the contract (employers will need to reach an agreement with the employment agency, as the agency will have the contract with the agency worker).
Strengthening statutory sick pay
This consultation related to the calculation of SSP for low earners. Under the Bill, low earners will see their payments being calculated as a percentage of their average weekly earnings, rather than a flat rate of SSP. The consultation sought views on the value of the percentage.
The Government has confirmed that it will set the percentage rate at 80% of normal weekly earnings, which will apply where 80% of an employee’s normal weekly earnings is less than the flat rate. The Government has said that the 80% rate strikes the right balance between providing financial security to employees who need it, whilst limiting additional costs to businesses. They believe the percentage should also encourage employees to return to work at their full rate of pay when they are able.
Despite employer concerns about the removal of the waiting period, the Government has reiterated its commitment to make SSP payable from the first day of illness. The Government believes that it is important for employees to access SSP from day one so that they can take the time off they need to recover.
Collective consultation and fire and re-hire
This consultation was launched largely to consider views relating to the proposed increase in the protective award cap from 90 to 180 days’ pay per affected employee. The increase is the Government’s attempt to strengthen the remedies available, with the hope of deterring employers from breaching their collective redundancy and fire and re-hire obligations. Currently, employers proposing 20 or more redundancies at one establishment within a 90 day period are obliged to follow collective consultation before making any redundancies.
One establishment
Initially the Bill proposed to remove the wording “at one establishment”, which would have obliged employers to consider redundancies across the business as a whole. This change has not been introduced. However, where there are 20 or more redundancies across more than one establishment, whether collective consultation requirements apply will be determined by criteria set out in secondary legislation (yet to be published). The amendments also explain that employers will not be required to consult with all employee representatives together, or reach the same agreement with them all.
Protective award
The Government has confirmed that the protective award cap will increase to 180 days. However, Employment Tribunals will continue to have discretion to vary the length of the protected period, up to the cap as it currently does. The Government believes that the increase in the cap will provide a suitable deterrent against deliberate breaches of the requirements. The Government will monitor compliance once this amendment is in force, and it does not rule out further measures in the future.
On 20 January, the Trade Union and Labour Relations (Consolidation) Act 1992 (Amendment of Schedule A2) Order 2024 came into force. This legislation allows Employments Tribunals to uplift protective awards by up to 25% for collective consultation breaches where the employer has failed to follow the new statutory Code of Practice on Dismissal and Re-engagement. As the protective award is being doubled from 90 to 180 days the 25% uplift could now increase the protective award by up to the equivalent of 45 days’ pay compared to the current 22.5 days.
Interim relief
The Government has decided not to proceed with interim relief payments for employees that bring claims for protective awards and/or unfair dismissal as a result of being fired and rehired. The Government said that that interim relief will not be an effective remedy to strengthen compliance, and it would have placed undue pressures on businesses and employment tribunals.
Creating a modern framework for industrial relations
The purpose of this consultation was to seek views on the various trade union laws and practices proposed in the Bill. The Government was keen to modernise the framework and improve transparency as well as strengthening protections.
Balloting and information
The balloting and notice information requirements have been simplified and trade unions will now be required to give 10 days’ notice of industrial action, rather than 14 days. The Government considers the reduced notice requirement to be the appropriate balance in allowing employers to plan to mitigate the impact of the industrial action while respecting the right to strike. The Government will also introduce e-balloting, which is likely to increase employee participation in industrial action.
Currently the industrial action mandate remains valid for six months, but this will be extended to 12 months. The Government believes that this extension strikes the correct balance between ensuring that the numbers for industrial action are recent and reducing the need to re-ballot.
Right of access
The Government has rebutted concerns that legislating a right of access this will grant trade unions “unfettered” rights of access to workplace. It has said that the core objective is to ensure that access occurs in a regulated and responsible manner. There will be a framework under which trade unions and employees can negotiate access arrangements, but if an agreement is not reached, the Central Arbitration Committee (CAC) can impose an agreement. Through secondary legislation, the CAC will have the ability to impose fines for non-compliance with the agreement. In an attempt to modernise the system, the Government will also introduce a digital right of access as well as a robust dispute resolution system, led by the CAC.
Unfair practices during trade union recognition
The Trade Union and Labour Relations (Consolidation) Act 1992 sets out the procedure for recognition and derecognising of trade unions relating to collective bargaining. The CAC code of practice (Code) deals with unfair practices during the union recognition and de-recognition ballot. Unfair practices are actions that are taken by the employer or the trade union to influence the outcome of that ballot. Currently, the Code only applies for a specific time period during the balloting process, but this time period will be extended so that it applies throughout the recognition process. The Government has confirmed that it will keep the list of unfair practices under review to make sure it remains fit for purpose.
Other notable changes
Some of the other key changes are:
- Provisions to deal with the prevention of mass recruitment into the bargaining unit for the purposes of the recognition process (to prevent membership dilution).
- Unions will no longer need to ballot members every 10 years.
- Secondary legislation to improve rights and protections for trade union representatives and members.
- Regulations to remove the requirement that at least 50% of all eligible members must have voted in industrial action ballots – although this provision will not go ahead until e-balloting is introduced.
What about the “right to switch off”?
Despite it being one of the Government’s flagship proposals, the “right to switch off” was not mentioned in the Bill when published in October 2024. The Next Steps paper (published alongside the Bill) talked of the intention to take this forward through a statutory code of practice. However, reports this week have suggested that the Government plan to abandon this proposal altogether, and there has been no reference to it in the Bill’s Amendment Paper! We will therefore have to wait and see whether this proposal is introduced at some point in the future.
What happens next?
No specific timescales have been published yet. Further consultation and secondary legislation will be required to implement the changes and provide additional detail. The Government has previously said that it understands that adjusting to these new reforms will take time and that it is committed to ensuring that all stakeholders receive appropriate time to prepare for these changes ahead of their commencement.
The Bill is due to have its House of Commons Report stage and 3rd reading on 11 and 12 March.
The Government’s response to consultations will give some needed clarity for employers, whether or not they are welcomed by employers. This clarity will allow employers and providers of agency workers opportunity to audit their working practices and plan for the changes when they are implemented.
We will continue to keep a watching brief as the Bill progresses through Parliament, and when secondary legislation is published. In the meantime we can help you plan for the changes:
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Knowledge Regular updates on the reforms and the practical impact for your organisation. |
Policies and procedures Policy audits, comprehensive policy refresh, systems and practice reviews - particularly in light of arrangements affecting low and zero hours workers. |
Contract compliance Employment contract reviews and compliant template clauses, procurement contract reviews, advice on changes and compliant template clauses for outsourced services to third parties and wholly owned subsidiaries. |
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Communications packs Template communications and correspondence, internal awareness briefings, external communication pieces. |
Training and Development Bespoke modular training and workshops for managers, HR and decision makers, webinars providing vital and practical information on the implementation of new rights, and focus group sessions. |
Support In strengthening relationships with staff-side and trade unions. |
For more information please contact the Employment, Pensions and Immigration team, who will be more than happy to help.
