What employers need to know about the Employment Rights Bill

The UK Government announced a flurry of amendments to the Employment Rights Bill 2024 and multiple aspects of employment law are changing, although more debate is expected before it becomes law both employers and employees need to be aware of this changing legal landscape.

“The changes we have seen outlined are a significant shift in the employment law landscape and these changes require employers to adapt their business practices and policies as it moves forward,” says Carley Dhand, Senior Associate at Pearson Solicitors.

“This is by far the biggest overhaul of employment law in years, the most notable of which is to increase the time limit for bringing employment tribunal claims from three to six months.  In addition, workers rights are changing and existing laws being transformed, so it always pays to consult with an employment professional to make sure your business is ready to adapt,” advises Carley.

Employment Rights Bill consultation

As we move forward towards further consultation the key takeaways for employers include:

Fire and Rehire

A central part of the change is a proposal to end fire and rehire, making it unfair to dismiss employees who refuse contract changes, unless the employer is facing dire financial circumstances and the situation cannot be avoided.

Our advice is always to keep communication channels open and have a transparent relationship with staff, with these amendments business owners now need to make sure any contractual variations are mutually agreed upon.

Collective Redundancy Consultation

The maximum protective award is to increase from 90 days to 180 days and the Employment Tribunal can uplift compensation by up to 25% if an employer fails to comply with the Code of Practice on Dismissal and Reengagement.

In addition, consultation with appropriate representatives will no longer need to be carried out with all representatives together, or with the aim of reaching the same agreement for all employees.

Guaranteed Hours Contracts (GHC)

Employees are to be offered guaranteed hours, given notice for shifts and also compensation for short-notice cancellations or any subsequent changes.  Following the amendments employers will also be required to give information regarding the right to guaranteed hours within a set period to workers where it is reasonable to assume they will become a qualifying worker.

This change will also apply to agency workers and final details and further consultation on the mechanics of this is still be debated.

Statutory Sick Pay

Statutory Sick Pay is to become a day one right for all workers, removing the SSP waiting period and the lower earnings limit.

Right to disconnect

This was intended as a break for staff  - exactly what it says, a "right to switch off" after work, at weekends, anytime not in work and not to feel pressurised into work-related communication outside of normal working hours, however this was not included in the amendments and further details are expected in the next few weeks.

Trade Unions and Industrial relations

The legislative framework in which trade unions operate will be adapted and further details will be released later this year.

Unfair Dismissal

Unfair dismissal will become a day-one right for employees, subject to a new "light-touch" dismissal procedure which will apply in most cases during an initial period of employment.

The finer details will be contained in the regulations and are as yet unknown.  However it is clear that the reforms will represent a major change in the unfair dismissal landscape and may result in a significant increase in employment tribunal claims as employees will no longer be required to satisfy the two-year qualifying requirement to challenge the fairness of a dismissal.

“These amendments may result in employers finding themselves with a significantly expanded number of new employees able to bring unfair dismissal claims, says Carley.”

Employment Rights Bill Parliament

The Employment Rights Bill will now progress through Parliament and the House of Lords to address much of the detail it is a work in practice and awaits secondary legislation - as with most things employment related it is a moveable feast and one we will continue to keep our clients updated on.

“As the Bill progresses employers need to start to prepare for it and I suspect most of this will come into force for 2026, business owners can make life easier for themselves by planning ahead this next financial year, make any necessary adjustments to their policies, recruitment processes, contracting, and workforce management practices,” adds Carley.

How can we help?

For legal advice on your employement rights or other aspects of employment law contact our solicitors on 0161 785 3500 or email enquiries@pearsonlegal.co.uk

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Please note that the information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Pearson Solicitors and Financial Advisers Ltd or any of its members or employees. Professional legal advice should be obtained before taking, or refraining from taking, any action as a result of this article.