The much-heralded new Employment Rights Bill, as initially announced in the King’s Speech back in July, has finally been published. There has been the usual circus of announcements, press releases, backlash, commentary. Quite a bit of waffle too… Hopefully though you’re all keen to know what Wiggin thinks and what this might mean for our clients, and particularly the key sectors we specialise in.

We’re here to meet that challenge and have spent the day delving into some of the detail. Quick caveat before we get started – there are 158 pages of new bill here, lots of which is hard to decipher given it directly amends various sections of other (already complicated) legislation, so these are just our preliminary thoughts. But we feel we certainly have enough to give you a flavour of what is to come.

First things first – for those anticipating a whole swathe of new changes this side of the festive season or those who (reports suggest…) may have been a little trigger happy with letting staff go who haven’t quite reached the two years’ service threshold, you may have been getting a little ahead of yourself. The biggest shock today is the timing of all of this. We apparently won’t be seeing the vast majority of the reforms until potentially late in 2026, so this could all be two years away! A stark difference to how this was presented during the King’s Speech.

Secondly, is this truly the ‘one ring’ of employment legislation (last LOTR reference, promise) set to revolutionise the UK employment landscape? It would appear on first read that’s very unlikely. There are some key changes here and lots for employers to get their heads around but the UK is clearly not heading towards a set of overly burdensome employment laws and will therefore remain (we would say!) a very attractive place to do business.

So what is going to happen then? Here are the key takeaways at this stage:

• The biggest proposed change in the run up to the publication of the draft bill was the suggestion that unfair dismissal protection would be rolled out as a day one right. This change is indeed reflected in the bill, with the provisions related to the two-year qualifying period being repealed. However, we now also have confirmation that it would appear dismissals within what is referred to as an ‘initial period of employment’ (i.e. probation) will not require a fair process but significantly would appear to still need to be for a substantively fair reason (e.g. misconduct, poor performance, redundancy etc). So, in other words, you should be able to dismiss during probation but you still need a ‘fair’ reason to do so – “this person just isn’t quite right” is unlikely to cut it! There’s no doubt this is a substantial change to the current legal framework and will require careful thought from all employers. If it’s rolled out wider to all workers (i.e. not just employees) which may well be the case (see below), then the significance will be even greater still, particularly for film and TV businesses given the number of freelance crew with such status;
• There are new rights related to flexible working which initially look transformative but on reflection will probably do little to shift the dial. Essentially, employers will still be able to refuse flexible working requests but the refusal must be ‘reasonable’ (a common employment law buzzword…), with employers being required to explain why the refusal is reasonable. Some could think this sounds burdensome, but the penalty for breach would appear to remain limited to 8 weeks’ pay. Our thoughts – well it will certainly help increase pressure on businesses to treat flexible working requests seriously and could lead to further disputes in this area. But many employers may feel comfortable rolling the dice given the apparent limited risk / liability potential;
• Perhaps most surprisingly (as this hadn’t really been teased previously), the bill brings back vicarious liability for third party harassment (which was abolished by the coalition government in 2013). This is significant and will helpfully bring the Equality Act in line with the recent EHRC guidance that states clearly that the new duty from 26 October 2024 on employers to prevent sexual harassment also applies to preventing third party harassment. Again new in this area is the suggestion that sexual harassment allegations will become protected disclosures for the purpose of whistleblowing proceedings. Each of these changes will be important and further emphasises the pressing need for businesses to get to grips with their fight to prevent this sort of behaviour occurring on their watch;
• Fire and re-hire will also be getting (another) overhaul. We knew something was coming here but the change is arguably quite dramatic – it will become automatically unfair to dismiss an employee for refusing a contract variation. There will apparently be some limited exceptions to this where there are material financial considerations at play and where consultation has occurred, but the reality is this looks set to make employment contract changes and harmonisation processes a lot more tricky;
• Something else new is a change to the laws regarding collective redundancy consultations. The obligation is currently triggered when an employer contemplates 20 or more redundancies within a 90-day period within one ‘establishment’, but the establishment requirement is set to be scrapped, with the ’20 or more’ being applicable across the whole business. This could again be very significant for large change programmes and particularly those carried out by larger national and multinational businesses;
• And finally (and this is not an exhaustive list), there are a whole host of new trade union related changes. These include the rights for unions to request access to an employer’s workforce to enable them to recruit (!), with very complicated provisions being introduced to govern an employer’s response to such a request, and a new requirement to state in a worker’s contract that they have a right to join a trade union – so something new for employment and worker contracts, which will of course also mean changes to direct hire freelance and crew agreements.

A decent amount of reform then but, as alluded to above, this is all seemingly some way out. It will also all be subject to considerable consultation (hence the delay), so the proposals may (and inevitably will) change in the months ahead.

What strangely doesn’t form part of the new bill is any mention of addressing employment status. Most would agree this needs looking at, and the government’s press release today suggests there will indeed be a transition towards a single status of worker in due course. Currently, “worker” and “employee” are two different categories of employment status, with workers being entitled to some (but not all) of the same rights as employees. Critically, workers do not receive protection from unfair dismissal, so the proposed shift to a single status of “worker”, coupled with some of the above changes (particularly the new day-one unfair dismissal rights) could have a profound impact on certain businesses and sectors.

That said, it must be emphasised again that nothing is changing immediately or, by the looks of it, any time soon. There will therefore be ample time for all businesses to plan and adapt to any new rules.

We’ll continue to be on the coalface as further developments arise and look forward to hosting a webinar on the new bill in the coming weeks, so please stay tuned for further updates from us.