FEATURE KNOW YOUR RIGHTS
Lucy Gordon, Partner, and Lauren Owens, Associate, at Walker Morris LLP, shine a spotlight on the Employment Rights Bill and its potential impact on the care sector.
The UK Employment Rights Bill (ERB) was a key manifesto promise of the current Labour government and is expected to receive Royal Assent later this year. Relatively few of the provisions of the ERB will come into force with its passing, most of the changes will be phased in over the next few years. The bill will make significant reforms to employment law and impact on the future HR practices of businesses. This article will discuss the provisions of the ERB which will have a particular impact on the care sector.
EMPLOYEE PROTECTIONS
The ERB intends to introduce provisions to strengthen employee protections, such as enhanced job security and stronger safeguards and pay enhancements. In particular: • Day one rights for unfair dismissal claims, paternity leave and unpaid parental leave.
• Statutory sick pay – entitlement from first day of illness, no minimum earnings requirement.
• Flexible working – must be reasonable to refuse request, and requirement to explain reasons.
• Stronger protections for zero/low hour workers. • Strengthening of trade union rights. • Redundancy and collective consultation– increase in protective award and changes to the collective consultation threshold.
DAY ONE RIGHTS
Traditionally, many entitlements for employees in the UK have been reliant on certain qualifying periods, which mean employees have to be in employment for a set amount of time before they 'earn' these entitlements. However, under the ERB, some of these rights will be made a 'day one right', meaning employees will be entitled to them from the first day of their employment.
The current qualifying periods for paternity leave (26 weeks) and unpaid parental leave (one year) will be removed, so that employees will be entitled to leave from day one. As the number of employees eligible for this type of leave increases, employers will need to ensure staffing levels are sufficient to account for this and there is likely to be an uptick in costs which will need to be factored into financial planning. This change is expected around April 2026.
Lucy Gordon Lauren Owens
In relation to unfair dismissal, the qualifying period will also be removed so that employees will have the right not to be dismissed from day one. However, it is anticipated that there will be a statutory probation period during which the employer can terminate employment or serve up to three months' notice to terminate employment, for performance or conduct, following a 'lighter touch' dismissal process. This change is expected in 2027 and will mean that more employees will have unfair dismissal rights than was previously the case, potentially leading to an increase in Tribunal claims – further contributed to by the intention under the ERB to increase the time limit for bringing a Tribunal claim from three to six months. This is likely to be a particular issue for the care sector, where traditionally high levels of turnover and short-term contracts have meant many employees don’t have the requisite two years' service to bring an unfair dismissal claim.
To help address this, employers should take steps to ensure that all new starters have a probation period in their contracts and that there is a process in place to regularly review employee performance during this time. Employers will also need to review disciplinary and dismissal policies and processes, and ensure managers are trained in these areas.
ZERO-HOURS CONTRACT REFORMS
Under proposed changes, zero- or low-hours workers who qualify will have a right to be offered guaranteed hours to reflect hours worked over a defined reference period (likely to be 12 weeks).
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