The government has tabled significant amendments to the Employment Rights Bill following responses to consultations on some aspects of the Bill (specifically, statutory sick pay, the application of zero hours measures to agency workers, collective redundancies, fire and rehire, industrial relations and umbrella companies).
These consultation responses can be found here. The amendment paper to the Bill runs to over 200 pages. These amendments are mostly proposed by the government and will be considered by parliament later in March. A summary of the key proposed changes is set out below:
Collective redundancy consultation
Under the current law, employers must collectively consult if they are proposing to dismiss as redundant 20 or more employees at one establishment within a period of 90 days or less. The Bill amended this to remove the "one establishment" criteria meaning that the threshold for the statutory requirement to consult collectively would apply to those dismissed across the employer’s organisation. This has again been amended to reinstate the original test but also to add in an additional test, so that the duty to consult will be triggered in the following two different scenarios:
- where an employer is proposing to dismiss as redundant within a period of 90 days or less 20 or more employees at one establishment
- where an employer is proposing to dismiss as redundant within a period of 90 days or less at least “the threshold number of employees” – this new test will be relevant for employers with multiple establishments
The amended Bill provides that this threshold will be set out in regulations, but may be, for example, a specified percentage of employees. This is a significant change to the law.
Helpfully to employers, the relevant legislation will be amended so that they will not be required to consult all representatives of the affected employees together. Further, it will not be necessary to reach the same agreement with all of the representatives.
Doubling of the protective award
The protective award that can be made if collective redundancy consultation obligations are not met will double from 90 days’ to 180 days’ pay per affected employee. The government is explicitly seeking to deter employers from deliberately ignoring these obligations.
Unfair dismissal rights from day one of employment
Under the original draft Bill, employees will no longer require at least two years’ service to be eligible to claim unfair dismissal. However, regulations will modify the normal dismissal process for dismissals that occur during a statutory probationary period and which relate to the individual’s conduct or performance. The amendments to the Bill do not confirm what length the statutory probationary period will be, although the government have stated that their preference is for it to be nine months.
Zero hours/low hours measures extension to agency workers
The changes previously announced in relation to zero hours contracts will also apply to agency workers under the amended Bill. The aim of these changes is to ensure that employers cannot circumvent the rules by using agency workers.
Under these proposed rules, the hirer will be under an obligation to offer a qualifying agency staff a contract guaranteeing minimum hours. We do not yet have details of the relevant reference period for calculating the guaranteed hours.
Agency workers will have the right to reasonable notice of shifts, shift cancellations and changes to shifts (both the agency and hirer will be responsible for this). The agency will be responsible for paying the agency worker a proportionate payment when shifts are cancelled, curtailed, or moved at short notice, although, the agency may be able to recoup such costs from the hirer by agreement. We do not yet have any definition of what "short notice" will be.
Significantly, these amendments provide that the rights to guaranteed hours, reasonable notice of shifts and compensation for cancelled, curtailed or moved shifts for zero hours, low hours and agency workers can be excluded by a relevant collective agreement with a trade union.
Statutory Sick Pay
Under the Bill, sick pay entitlement will be extended so that Statutory Sick Pay (SSP) will be paid from the first day of illness (rather than from the fourth day at present). The Bill also removes the lower earnings limit, but allows for low earners to be paid at less than the normal level of SSP. Under these new amendments, employees will have a right to sick pay of 80% of their average weekly earnings or the current rate of SSP, whichever is lower.
Bereavement leave and pregnancy loss
The original draft of the Bill expands on current provisions for bereaved parents to take leave, providing that any bereaved person (as defined) may qualify for such leave. The amendments to the Bill extend parental bereavement leave and pay to employees who experience pregnancy loss before 24 weeks (currently it only applies after 24 weeks).
Dismissals during/after pregnancy
The Bill already provides for regulations that expand existing protection from dismissal during or after a protected period of pregnancy, and following a period of statutory family leave. The amendments provide the right to make regulations about notices that will need to be given, evidence to be produced and other procedures that will need to be followed.
Umbrella companies
The amendments allow for umbrella companies to be regulated to ensure those working through umbrella companies will enjoy comparable rights and protections to those who are directly engaged by a recruitment agency.
Trade unions
The rules within which trade unions operate will be amended so that, among other things, changes will be made to strengthen protections against ‘unfair practices’ during the trade union recognition process, certain information requirements will be simplified for industrial action ballots and notices and a digital right of access to the workplace for collective bargaining purposes will be introduced. In addition, mandates for industrial action will be valid for 12, rather than six months. Amendments are made to the right for unions to request access to the workplace for union officials. Where an employer refuses or obstructs this right of access, penalty notices may be issued.
Fair work agency
The amendments expand the scope of powers to given to the Fair Work Agency, including enabling it to enforce certain statutory payments such as holiday pay and statutory sick pay. Potentially very significantly, the Fair Work Agency will also have the power to bring Employment Tribunal claims on behalf of workers who have the right to bring a claim but have not done so and will also be able to provide individuals with legal assistance. It is not clear, though, exactly how this will work in practice.
Frances Rollin