What a Labour Government means for UK Employment Law

5th July 2024

By Sally Bird, Partner

Whilst Labour’s election victory is certainly likely to keep employment lawyers gainfully employed for some time, as the self-proclaimed party for working people, it will come as no surprise that the focus will shift towards greater individual employment rights and enhanced Trade Union rights which some – particularly business owners and employers – will regard as burdensome.

Ahead of the election, the Labour Party announced that they would introduce a raft of sweeping changes to UK Employment Law within their first 100 days in office so they do not intend to hang around. We have highlighted below some of the key proposals from their Manifesto that we can expect to see coming down the line.

Day 1 Rights – Unfair Dismissal

One of the standout pledges was that employees will have the right not to be unfairly dismissed from day 1 of their employment. The current qualifying period for unfair dismissal is 2 years and this typically means that unless there is a basis to allege discrimination on one of the protected grounds, or whistleblowing, employers are able to dismiss without needing to establish a fair reason or that they have acted fairly in dismissing for that reason and followed a fair process.

To put this proposed change into context, there has never been a time where there has been no qualifying period for unfair dismissal. Under the last Labour government the qualifying period was 1 year, so for this to be reduced to zero is a radical change that will make it more difficult and burdensome to dismiss employees. Employers will need to be more rigorous in their recruitment, hiring and performance management processes.

Perhaps in recognition of this, Labour indicated some concession to enable the use of probationary periods though it is unclear how exactly that would work and there will be a lot of discussion around contractual probationary periods and the processes around them which Labour say must be “fair and transparent”. It remains to be seen whether any limits on the length of a probationary period will be introduced.

Time Limits and Statutory Caps

◆ The time limit to bring Tribunal claims will be increased from 3 to 6 months.

◆ Directors will be personally liable for unpaid tribunal awards, piercing the corporate veil.

◆The statutory cap for claims (currently £115,115 or 12 month’s gross pay) may also be removed.

Fire and Rehire

Firing and rehiring employees (the process of dismissal and re-engagement to introduce changes to contract terms) will not be outlawed but will only be permitted where the business “would not survive without it” – raising the bar significantly from the current law.

The Workers Predictable Hours regulations will also be amended so that employees will have a statutory right to regular hours, not just a right to ask for them. This to be based on a 12-week reference period.

Changes to Discrimination Laws

BAME and disabled employees will be granted equal pay rights and there will be new duties on large employers to produce ethnicity and disability pay gap reports, alongside the current duty to produce gender pay gap reports.

There will also be a requirement for employers with more than 250 employees to have a menopause action plan.

Employment Status

Labour will consult on reducing the three categories of employment status to two – “worker” and “self-employed”. The existing employee and worker status will be combined and workers would then receive sick pay, redundancy pay and unfair dismissal rights.

Sexual Harassment Protections

Employees will need to be proactive in taking all reasonable steps to prevent sexual harassment, extending the duty to cover the acts of third parties such as customers and suppliers.

Trade Union Rights

New rights making it easier for trade unions to gain recognition and access workplaces will be implemented alongside the repeal of recent anti-strike laws Trade union power and influence is also extended through the introduction of electronic balloting and new protections for trade union reps & members. There will also be a requirement to include in employee’s terms confirmation of their right to join a trade union.

Rights to Disconnect

Employers will likely be required to set up and implement policies not to routinely contact workers out of hours but only do so where legitimately required.

Collective Redundancy Consultation

Labour propose to make the trigger for consultation (currently 20 or more employees) dependent on the number of redundancies across the whole organisation, rather than in a particular establishment – this revoking the law which enabled Woolworths to limit the duty when it went bust based on each shop being a single establishment.

Flexible Working

It will be much harder for employers to refuse flexible working requests, by making this a default right unless there is a compelling business reason to turn them down – this is raising the bar considerably from the current position.


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