Changes – yes, they are coming, but not just yet

Martin Williams, a Partner at Mayo Wynne Baxter, looks at in-coming changes to Employment Law.

People have all sorts of reasons for voting for change in general elections. Some vote positively for something. Some vote against the incumbents. In our first past the post system, we experience tactical voting. Others vote on a single issue.

What is almost inevitable is that an incoming government will say it is bent on bringing about change. We have even had such comments when there has been a change in Prime Minister (without a change in governing party!).

There will be changes with the incoming Labour government. It holds too many seats in the House of Commons for much to stand in its way, even if it did not win over 50% of the popular vote. However, the latter is going to be a very rare occurrence.

No matter that only a minority of the population voted for the governing party, they are there on merit under the system we have. So, what changes will come about? I would like to address the possibilities with respect to employment law.

We are about to get an Employment Bill that promises to be the most far-reaching piece of legislation for many years. Thus far, the details are not clear, but we have had a fairly clear indication of what will come about because of the manifesto pledges and various commitments made prior to the election being called.

In its paper “Make Work Pay”, published on 24 May 2024, the Labour Party promised to introduce legislation within 100 days of coming into power. That timeline has to be taken with a bit of a caveat, as “introduce” is doing a lot of heavy lifting. The legislation could still be published within 100 days of Labour taking office on 5 July 2024 but that does not mean to say the changes will have immediate effect. The bill will have to go through the parliamentary process and many items will require extensive consultation and secondary legislation. There will also need to be a period of time before implementation, so all can absorb the changes. Always look past the headlines when assessing the pace of change.

We have to hope that what is published in the next month will give us a better understanding of where the key markers are to be drawn with this new deal for workers.

So, what are we going to get?

In a throwback to the 2017 Taylor Review, we have been promised a simplification of employment status with there being no difference between worker and employee. Many are surprised and confused about the current difference. HMRC ignores such differences and only looks at whether someone is employed or self-employed. Employment law is about to catch-up.

We also have new phrases like “Securonomics”. There is no point in looking this up in the Oxford English Dictionary, it is not there. Essentially the idea is that all jobs should provide a baseline level of security and predictability. As a preparation for this, the planned changes under the Workers (Predictable Terms and Conditions) Act 2023, have been put on hold and will not be brought into force.

Instead, we will be looking at what “banning exploitative zero-hours contracts” will mean. The qualifier of “exploitative” is a clue to the debate. Not a complete ban but a qualified ban. Plenty of scope for the lines in the sand to shift. There will also be “anti-avoidance measures”. So, no making the guaranteed minimum one hour rather than zero. The framing of this legislation is going to be difficult if it is looking at the hours someone “regularly” works. If the employee is new there are no regular hours to which anyone can refer.

There has been a lot of noise about banning the practice of “fire and re-hire”. Can there really be a complete ban? In short, no. This is why we will be assessing the drafting of legislation that provides for a process with dialogue and “effective remedies against abuse”. There will be a new statutory code and that will take time to be drafted. Immediate change? No.

The idea of basic day-one rights is also going to be interesting. Again, the expectation is that the reality will not match the headline. That is a hard fact of reality. We already know that the provisions will not prevent “probationary periods with fair and transparent rules and processes”. Dismissals will take place, but the bar will be higher for the employer compared to the current situation where ordinary unfair dismissal is not a possibility in the first two years of employment. We could be looking at probationary periods that have some sort of statutory status. That would be novel.

There are many more provisions that will come with the new bill. There will be changes with respect to TUPE, whistleblowing and self-employment (yes, confusingly that will be part of the employment legislation fabric).

The devil will be truly in the detail but change there will be, whether you like it or not. The collective choice of the electorate will come to the fore.

www.mayowynnebaxter.co.uk