Labour’s employment manifesto – the road paved with good intentions? (UK)James Pikeon June 13, 2024 at 3:31 pm Employment Law Worldview


There is, as you will have noticed, an election looming in the UK and in amongst the wrangling over lies about tax, missing D-Day commemorations and the fiercely contested issue of which leader has the least charisma, there are some potentially very significant changes in the offing when it comes to employment law.

We say “potentially” not because there currently seems much room for uncertainty about the outcome of the election, but because there must be some question over whether the changes set out by Labour in its “Plan to Make Work Pay: Delivering a New Deal for Working People”, which have today been broadly restated within its manifesto, will see the light of day in their current form. This is not just a cynical take on pre-election pledges made by all political parties which traditionally hover between the aspirational and the actively dishonest, but more a question as to how some of the changes proposed could actually be put into effect in practice.

Starting with some of the headline points, Labour have proposed Day 1 rights for workers, most notably including the right to bring a claim for unfair dismissal. Whilst it has been customary that successive Labour and Conservative governments have used the qualifying period for unfair dismissal as the legislative equivalent of a shuttlecock, batting it back and forth over the net between one year and two-year qualifying periods, what is proposed now is much more radical. Labour is proposing that this right would apply from the start of employment  and also has committed to introducing a single employment status, meaning that those many tens of thousands of individuals who are currently considered ‘workers’ would acquire that right as well. Labour has said that this would not stop employers applying a probationary period; however, they have stated that there would still need to be a potentially fair reason for dismissal during this time and so it isn’t clear whether some lower standard would be applied for demonstrating a fair dismissal during this time or whether probationary periods would be limited in length. These things really matter when turning electoral posturing into hard law and so we must hope that more thought has gone into how this will work in practice than is apparent so far.

Labour has also committed to ending ‘exploitative zero hours contracts’, in what doesn’t look in any way at all like the kind of language guaranteed to result in satellite litigation to determine when a zero hours contract is and is not ‘exploitative’. Legislation by adjective, especially subjective adjective, is pretty much doomed.

Similarly, it has also committed to ending the practice of ‘fire and rehire’ and outlawing this as a fair reason for dismissal, save where it is required in order to save the business. What level of desperation this requires is unclear – how close to insolvency do you have to be?  [For the uninitiated, ‘fire and rehire’ is where an employer terminates an employee’s contract in order to enforce a change to their terms and conditions of employment by offering to re-engage them on the new terms.]  This is a practice which has been common practice for many years without much in the way of political outcry; however, the practice was on the receiving end of significant negative press for the way British Gas applied it to its gas engineers and so is now in the firing line itself (pun intended). Whilst it may seem a simple enough job at first sight to legislate for such a situation giving rise to an unfair dismissal, it can only work if it is very clear to employers when they can use that process and when they can’t. No evidence of that so far. For example, where reorganisations occur, changes might be made to a role so that it is no longer required in its present form, but the same number of roles may be created at a more junior level on a level of pay which reflects this. That type of change, which wasn’t intended as a ‘fire and rehire’ scenario, might be caught. If it is, then would an employer avoid that being the case if it reduced the number of roles it needs (at least in the short term) by 1 so that it can position this as redundancy and ensure any dismissal is outside the scope of any fire and rehire scenario?

Perhaps unsurprisingly, there are also some significant changes proposed in relation to collective bargaining rights. First on the agenda is removing the higher thresholds  introduced by the current government for a lawful mandate for industrial action. What we would see as more significant, however, is the commitment to simplify the process for trade unions becoming recognised and also the thresholds needed in order for this to occur. Currently a union must demonstrate that at least 50% of the employees in the bargaining unit support recognition, whereas Labour proposes that there is a ballot at the end of the recognition process and only more than 50% of those who participate in the ballot would need to vote in favour for recognition to be granted. In a climate where trade union recognition is having somewhat of a resurgence, this could be a significant change. What it may also do is result in more recognition requests going to the CAC for determination, as with a lower bar and the end result being dependent on the votes of only those who participate on the day, it will be much harder for employers to know whether a union has support enough to mean that they should be recognising it voluntarily.

Other changes include a proposal to increase the time limit for bringing employment tribunal claims to 6 months, introducing ethnicity and disability pay reporting as well as changing the requirements around gender pay reporting to seek to make it more meaningful. Labour is also committing to introducing a single enforcement body for employment rights, a promise which was made by the current government a number of years ago but has never materialised.

Labour has said it will introduce legislation dealing with its employment commitments within the first 100 days in government and this is a promise restated within its manifesto. At the same time, is has also referenced the need to consult fully with businesses, workers, and civil society on how to put its plans into practice before legislation is passed. It therefore seems very unlikely that anything of real impact will take place so quickly, given the need for that consultation to take place and that some very careful and well thought-out drafting will be needed to be put these proposal into workable effect given the various complexities surrounding them. What is certain, however, is that a Labour government would not sit still on the issue of employee and worker rights. We just have to hope that it recognises that good law is better than fast law and that if it takes more time to convert these principles into legislation which is clear and understandable, that time should be taken.

There is of course another question, which underpins all these promises. It does not matter how many nice new rights and protections you are given if you have no practical means of enforcing them. The Employment Tribunal system is already on its knees in some regions and there is absolutely no possibility that without a gigantic increase in funding starting on July 5th, it will be able to offer timely justice to the parties to all the claims which must be anticipated as a result of these changes. No such increase is referred to in the manifesto. Just saying.

Employment Law Worldview

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