Employment Aspects From The Kings Speech

The King's Speech on July 17, 2024, indicated several significant reforms to UK employment law under the new Labour government. Here’s a summary of the key proposals and their practical implications for both employees and employers:

1. Ban on Exploitative Zero-Hour Contracts:

• For Employees: Workers will be guaranteed a contract reflecting their regular working hours, providing more stability and predictable income.
• For Employers: Employers will need to audit their workforce and possibly shift to alternative flexible working arrangements. This might increase costs and administrative burdens, especially in sectors heavily reliant on zero-hour contracts.
   

2. Ending "Fire and Rehire" Practices:

• For Employees: Protections will be enhanced against being dismissed and rehired under less favourable terms, except when it is necessary for business viability after thorough consultation.
• For Employers: This change will necessitate more rigorous consultation processes and may complicate restructuring efforts. Employers might need to explore alternative staffing solutions like using agency workers.
   

3. Day-One Rights:

• For Employees: Key rights, including sick pay, parental leave, and unfair dismissal protection, will be available from the first day of employment, increasing job security and benefits.
• For Employers: Businesses will need to update their HR policies and ensure compliance from the outset of employment, potentially leading to more complex onboarding procedures. Details about the use of probationary periods in order to assess suitability for a role are awaited.
   

4. Strengthening Trade Unions:

• For Employees: Easier access to union representation and greater protection for participating in industrial action.
• For Employers: Companies might face increased union influence, requiring more proactive employee relations strategies and potentially more frequent industrial disputes.
   

5. Fair Pay Agreements for Adult Social Care Staff:

• For Employees: Improved pay, terms, and conditions for social care workers, aiming to address staffing shortages and high turnover rates.
• For Employers: Social care providers will need to comply with new pay standards, likely necessitating increased funding and changes in budget allocation.
   

6. Creating a Single Enforcement Body:

• For Employees: Better enforcement of workplace rights through a new body with strong inspection powers.
• For Employers: Increased scrutiny and potential legal action for non-compliance, requiring businesses to ensure robust adherence to employment laws.
   

7. Equal Pay and Anti-Discrimination Measures:

• For Employees: Extended pay gap reporting for large employers to cover ethnicity and disability, and stronger measures to prevent outsourcing as a means to circumvent equal pay.
• For Employers: Companies will need to gather more comprehensive data and possibly adjust pay structures, involving more rigorous compliance efforts.

The Government say that these reforms aim to improve job security, fairness, and working conditions for employees while presenting new compliance challenges and potential costs for employers. Businesses will need to prepare for these changes through audits, policy updates, and strategic planning to manage the impacts effectively. 

The current indication is that there will be a new Employment Rights Act and Equality (Race and Disability) Act in order to implement the changes. Once the draft bills have been published we will be able to more accurately advise on steps which employers may want to start taking in preparation, and also on the timescales for the changes to take effect.