The Employment Rights Bill contains long-awaited proposed changes to employment law. If passed, these will likely affect almost all UK employers. In this article, Sarah Freeman, a former HR Director and now a Senior Consultant here at Pure, discusses the changes and how they might affect your business.

The Employment Rights Bill has been a long time coming. It contains the largest revisions to employment law for nearly 40 years. And it’s a significant step forward to upgrading employees’ rights and tackling poor working conditions.

The bill focuses on modernising ways of working to improve work-life balance, promote fair treatment and enhance employee protection. Ultimately it aims to deliver economic security and growth to businesses, workers and communities across the UK.

What changes does the bill make?

It proposes giving new rights to workers from day one of employment. For example, protection against unfair dismissal, and access to paternity and bereavement leave.

All in all the bill contains 28 individual employment reforms. These include:

1. Removing the three-day waiting period for statutory sick pay
Employers will have to pay this from the first day of absence.

2. Strengthening flexible working rights
Flexible working will become ‘the default’ for all workers, unless employers can prove a request is unreasonable.

3. Stopping potentially exploitative zero-hours contracts
The bill will give people the right to a guaranteed-hours contract if they work regular hours. (Zero-hours contracts will still be allowed for those who prefer them though.)

4. Protecting pregnant women and new parents against dismissal
New parents will have stronger protection for the first six months back at work after leave.

5. Making ‘fire and rehire’ automatic grounds for unfair dismissal
That’s when an employer fires a worker and then hires them back on different terms.

6. Requiring large employers to address gender pay gaps and help employees through menopause
At the moment these are recommended, but aren’t required by law.

7. Creating a fair pay agreement in the adult social care sector
The bill also proposes bringing back the negotiating body for school support staff.

8. Reinstating the two-tier code for public sector contracts
This makes sure employees with outsourced contracts get terms that are at least as good as those they had in the public sector.

9. Increasing employers’ duties to protect people from sexual harassment at work
Employers will have to take ‘all reasonable steps’ to prevent sexual harassment (at the moment it’s just ‘reasonable steps’).

10. Repealing the Strikes (Minimum Service Levels) Act 2023
The government describes this as ‘legislation that failed to prevent a single day of industrial action while in force’.

The bill also seeks to strengthen and modernise trade union members’ rights.

11. Creating a new ‘Fair Work Agency’
This will combine different organisations into a ‘one-stop-shop’ for workers’ rights. It’ll also help employers follow the new rules.

You can find out more about the changes in detail in this article by law firm Birketts. You might also want to read the government’s press release.

When will these changes become law?

The Employment Rights Bill has to go through various steps in Parliament before this can happen. Members of both the House of Lords and the House of Commons will debate it and suggest changes. There will also be consultation on the details of the rules needed to put the bill into action.

These processes take time. The bill isn’t expected to become law until the summer of 2025, and the government has said that most of the changes won’t happen until 2026. I’m hopeful that these will then be phased in to give businesses enough time to implement them properly.

How will the changes affect employers?

New unfair dismissal rules mean induction processes will need to change

Currently, a person can only claim unfair dismissal if they’ve been continuously employed for at least two years. And employers can end someone’s employment without giving a reason during this initial two-year period. The bill proposes giving individuals the right to claim unfair dismissal from day one of employment.

Having said that, the bill also proposes a statutory probation period called an ‘initial period of employment’. The suggested length is nine months. Employers will still be able to sack workers without a full dismissal process during this time, but it must be because of their performance. If an employer does that, they’ll have to have evidence of this for any potential unfair dismissal claims.

If this new probation period becomes law, employers will need to refine and improve recruitment processes. They’ll also need strong induction and performance-management processes in place. These should enable open conversations about new employees’ capabilities to help them be successful from day one.

Together, these will help employers hire the right people with the right values straightaway, eliminating the need for performance-related dismissals during probation.

This is something a recruitment company like ours can help with. We use our expertise to match organisations with people that perfectly fit their ethos, and can be successful as soon as they start.

Flexible working practices will become the norm

The bill aims to strengthen employees’ right to work flexibly. Employers will still be able refuse flexible working requests. But they’ll have to have valid (and fair) legal reasons for this, and be prepared to explain these to the employee.

There are eight business reasons listed in the Bill which count as unreasonable. These are the same as the ones currently in place to reject a flexible working request.

It’s not clear yet what processes an employer will need to go through to demonstrate that a request is unreasonable. But it is clear that more employers will be asked to ‘trust’ their people to work at home and out of the office.

Zero-hours contracts will change

Many people on zero and low-hours contracts actually work regular hours. The bill proposes giving them the right to move to guaranteed-hours contracts that reflect this, and give them more employment rights. This means employers will need to consider if their contracts really are zero hours, or if their staff in fact have regular working patterns.

This will particularly affect agency workers. The government has said they’ll hold a specific consultation to decide how to apply the new provisions to these types of workers.

This change is designed to end unscrupulous employment practices. But zero-hours contracts do work for some people, for example students and carers. So employees will be able to decide to stay on zero-hours contracts if they prefer them.

Carers could potentially have more rights

One very welcome change is that the government are looking into ways to help carers, including possibly bringing in carer’s leave. They’ve said they’ll investigate whether they need to change the current approach to make life easier for those who care for dependents while working.

We’re here to help

If you have any questions about the bill, or you’d like to discuss its implications for your organisation, please get in touch. We’re ready to help you prepare for the changes, and overcome any challenges they might create.