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The eagerly anticipated Employment Rights Bill: hope v reality

Employment lawyer ALICE BOWMAN warns ‘day one rights’ include an undefined ‘initial period’ and the zero-hours contract fixes create baffling fixed-term loopholes. If the Bill doesn’t work properly and deliver, Labour is doomed

Workers on the picket line outside Royal Sussex County Hospital in Brighton during a strike by nurses and ambulance staff, February 6, 2023

THE eagerly anticipated Employment Rights Bill, the pinnacle of Keir Starmer’s Labour government, is due to receive royal assent later in the year.

The headlines all sound fantastic — day one rights, end of fire and rehire, a ban on zero-hours contracts — but is it all what it’s all cracked up to be? Let’s look at a couple of the provisions widely welcomed by the trade union movement.

Day one rights

Giving employees the right not to be unfairly dismissed on day one of starting work seems progressive and bold.

However, the introduction of the concept of the “initial period of employment,” the definition and length likely to be confirmed in subsequent regulations, qualifies that right.

Dismissals (except redundancy dismissal) are likely to be fair if a particular procedure is followed, involving a meeting with the employee to explain concerns, during the “initial period of employment.”

Further, those dismissed in the “initial period of employment” are likely to receive a special compensation regime, although this is yet to be defined; presumably, those dismissed in the “initial period of employment” will receive less than their colleagues dismissed outwith this period.

Indeed, the concept of day one rights has attracted some criticism for the impact it may have on equalities; some employers may be less inclined to employ disabled workers, or those with who ordinarily they would take a chance.

Although those workers may have remedy under the Equality Act, evidencing that the reason for not hiring was discriminatory will almost certainly be difficult to evidence.

Day one rights seem to be far less robust than the headline had us believe.

Zero-hour contracts

Designed to address the problem of the “precariat,” the Bill will require employers to offer guaranteed hours to those currently on zero-hours contracts or those on a low number of guaranteed hours, at the end of every reference period.

The offer of guaranteed hours must reflect those hours worked during the reference period. The reference period is presumed to be 12 weeks. Sounds a bit complicated, doesn’t it?

Further, the Bill proposes that it is possible to offer a fixed-term contract if it is reasonable for “temporary worker need.”

This gives rise to several problems. Let’s take an example of a bar worker, presently on a zero-hours contract, who usually works a couple of shifts a month.

Theoretically, the bar worker could present for work and be given a four-hour fixed-term contract to work that shift. They are told at the start of the shift that at the end of the shift, they will be dismissed. As currently drafted, this fixed-term contract could be seen as reasonable, as there is “temporary worker need.”

The worker allegedly has a day one right not to be unfairly dismissed; however, that right does not necessarily afford them complete protection in the “initial reference period of employment” and they can be dismissed upon expiry of the fixed term contract where there is “temporary worker need.” Even as an employment lawyer, the whole situation is baffling.

Trade union rights

The Bill will give trade union officials a wider right to access workplaces for the purpose of collective bargaining, recruitment and organising. Without doubt, this is positive.

The Bill also states that employers must give new hires an explicit statement that they have a right to join a trade union when giving their statement of particulars on day one of employment. Although this sounds positive, at present, many employers still default on their obligation to give a written statement of employment particulars.

The remedy in the employment tribunal is compensation of up to two weeks’ wages. Employers may well decide they would rather take the chance and risk being forced to give their employees up to two weeks’ wages, rather than giving the statement to staff that they have a right to join a trade union and having a bunch of militant trade union members on their hands.

Tribunal claims

Although the Employment Rights Bill seems to be complicated and confusing, what is almost certain is that it will give rise to an increase in employment tribunal claims.

In England and Wales, claimants often can wait two years from lodging their claim to reach a hearing. In Scotland, thankfully, our cases proceed through the tribunal process faster. Nevertheless, without proper resourcing in the tribunal system, we could see tens of thousands more cases in the tribunal, waiting several years to be heard.

Many litigants may consider the time, financial and emotional costs spent during litigation not worth the trouble, particularly if they have moved on and secured alternative work elsewhere. Indeed, the industrial heat of litigation may subside to a dull ember, the longer cases go on for.

The impact

I hope that this Bill is more than a token “pro-worker” appeasement to the trade unions. Clearly, we want this Bill to succeed — to be enforceable, to offer workers greater protection, to strengthen collective bargaining, to empower our class. If it doesn’t, if it crumbles beneath the weight of its own ambition, Labour will almost certainly be doomed.

The alternative being, well, if the Unite the Kingdom protest was anything to go by, presumably Reform? The rights of workers in the workplace will not only worsen, but the power of trade unions too.

Perhaps the Bill is just another reminder that workers have the most power in the workplace, articulating their collective rights in unity, as opposed to an over-reliance on their individual rights in the employment tribunal.

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