The Labour Government has pledged to introduce an Employment Rights Bill within 100 days of taking office, as part of a broader Making Work Pay initiative.
Business Secretary, Jonathan Reynolds, was recently quoted as saying that ‘business and workers will always help to shape the ambitions of government, including our plan to Make Work Pay, to ensure it boosts economic growth and creates better working conditions for all’.
But how could this Employment Rights Bill impact on your small business?
A bill to preserve and support workers rights.
Labour is banking on Making Work Pay as a way to incentivise workers, protect employees and provide a framework for employment rights that will promote the growth of UK plc.
The proposed Employment Rights Bill will:
Ban exploitative zero hours contracts that don’t offer guaranteed regular hours.
End fire and rehire practices to protect the rights of workers.
Introduce basic rights from day one to parental leave, sick pay and protection from unfair dismissal.
Strengthen the collective voice of workers, including through their trade unions, and create a Single Enforcement Body to ensure employment rights are upheld.
Make sure the minimum wage is a genuine living wage by changing the remit of the independent Low Pay Commission so for the first time it accounts for the cost of living.
Remove the discriminatory age bands, so all adults are entitled to the same minimum wage, delivering a pay rise to hundreds of thousands of workers across the UK.
What could the impact be for employers?
Having a clear framework and structure for employment rights should, in theory, make it easier for both employers and employees to know where they stand regarding legislative practices.
But by cracking down on the regulation of employment rights, Labour may also be creating further challenges for small business owners that already struggle with red tape.
For example: Employees will have some rights, like sick pay, from day one.
A new employee could, theoretically, work for one day and then be off sick for a month, putting pressure on small and micro businesses that have limited cashflow.
Wiping out age-related minimum wage bands could greatly increase payroll costs for businesses that employ a large number of younger workers or apprentices.
Taking on an employee would bring greater potential risk to a small business, which could dissuade some owners from taking on employees and expanding their business.
Talk to our Surbiton office about the possible impact of the Employment Rights Bill.
Doing the right thing for your workers and protecting their fundamental rights is important. However, you may have concerns around how this proposed Bill may affect your business.
If you’re worried about the Employment Rights Bill, come and talk to our team. We can outline the potential impacts and what you can do to prepare for these changes.
