10 Key Takeaways from the new Employment Rights Bill

The Government’s much anticipated Employment Rights Bill was finally published on 10 October 2024 introducing extensive reforms designed to improve workers’ rights across the country. Coming in at a whopping 158 pages, to save you from having to pore over the detail we have set out our 10 key takeaways from the Bill.

1. Unfair dismissal protection from day 1

Arguably the most significant aspect of the Bill is giving employees unfair dismissal protection from the first day of their employment. 

Removing the existing two-year qualifying period is undoubtedly a huge change, and it will reduce the wide scope businesses currently have to dismiss an employee in the first two years of employment.  

2. Introduction of a statutory probation period

Whilst employers will now need a fair reason to dismiss an employee regardless of their length of service, a new statutory probation period will be introduced during which a light touch dismissal process will be accepted by Employment Tribunals as being fair. 

In the coming months the Government will consult on the length of the statutory probation period, but its preference seems to be a nine month probation period. 

3. Ending fire and rehire practices

Terminating an employee’s employment and offering them new employment under different terms and conditions is a recognised way of varying an employee’s employment contract without their agreement. This practice is more commonly known as ‘fire and rehire.’ 

In a significant change, terminating an employee’s employment because they will not agree to vary their employment contract will now be automatic unfair dismissal. There is only one very narrow exception where the reason for the variation is to save the company from financial collapse. 

This will be hugely welcomed by trade unions who have long criticised fire and rehire practices, but on the other hand it will be very unwelcome news for businesses, because it will make it incredibly difficult to remove legacy contractual benefits from an employment contract.

4. Third party harassment

The Bill re-introduces employer liability for third party harassment. If an employee is harassed at work by (for example) a tenant, customer or service person - an employer can be liable unless it has taken all reasonable steps to prevent it. Importantly, this duty applies to all types of harassment (not just sexual harassment), and it gives employees the right to take legal action against their employers if they do not comply with it.   

Businesses in sectors where there is an increased likelihood of third-party harassment, for example the care sector, should start to take steps to mitigate the risks once the duty comes into effect. 

5. Right to guaranteed hours of work

Where a worker is engaged under:

• a zero hours contract (a contract that guarantees no hours or work); or 
• a minimum hours contract (a contract that guarantees a minimum number of hours per week)

under the Bill, an employer will have an obligation to offer a guaranteed hours contract that reflects the number of hours a worker usually works. The individual may choose to remain on a zero hours or minimum hours contract if they want to, but the employer must at least offer them the guaranteed hours. 

The Bill also gives these workers the right to reasonable notice of a shift, and to reasonable notice of the cancellation of a shift. 

In welcome news to the recruitment sector these changes will not currently apply to agency workers, but the Government has suggested it will consult separately to consider how the changes can be applied appropriately to agency workers. 

6. Flexible working requests 

Any refusal of a flexible working request will now have to be reasonable, but the eight permitted business reasons for refusing a flexible working request remain in place. Equally, the penalty for employers remains 8 weeks’ pay. 

These changes to flexible working are therefore not as significant as originally envisaged.  

7. Trade union reforms

The Bill significantly strengthens the rights of trade unions. Including reasonable rights of access to workplaces, a simplified and easier trade union recognition process, a new duty on employers to inform employees of their right to join a trade union, and making it easier for trade unions to call strikes. 

Once implemented, these changes will undoubtedly result in trade unions playing a much more of a role in employee relations issues nationwide.

8. Collective redundancy consultation

Currently, employers must collectively consult when they are considering making 20 or more people redundant from one establishment. Meaning that employers do not have to collectively consult where the redundancies are spread across different offices and there aren't 20 or more planned redundancies from one location.  

The Bill changes this and the obligation to collectively consult will be triggered if the business is considering 20 or more redundancies across the whole company.  

9. Statutory Sick Pay (SSP) Reform

The three day waiting period for SSP will be abolished, making it payable from the first day of sickness. 

10. What’s missing?

Whilst the Bill is noteworthy for what it does contain, it is just as noteworthy for what it doesn’t. Despite the Government suggesting it would during the election, the Bill does not contain the following:   

• A right for employees to switch off.
• Ethnicity and disability pay gap reporting for large employers. 
• Removing ‘employee’ as a recognised employment status, and moving towards two tiered system with individuals either being ‘workers’ or ‘self-employed.’  

Comment

Whilst the Bill outlines significant changes in the employment landscape, there is a lot of detail that still needs to be clarified in the coming months as the Bill makes its way through Parliament. Whilst some of the proposed changes are not due to come into force until Autumn 2026, the wide ranging nature of the changes are likely to impact all areas of the business and (as ever) businesses will do well to start their preparation early.   

If you require further guidance on the Employment Rights Bill, please contact a member of our Employment Team.