As the UK gears up for the next general election on the 4th of July, potential changes to employment law are a key concern for both businesses and job seekers. Each major party’s manifesto outlines distinct visions, promising substantial shifts in the employment landscape. This in-depth analysis explores what the future may hold based on the election outcomes.
The Political Landscape and Employment Law
Employment law is a key area where political parties present their distinct approaches. Here’s a breakdown of what the major parties are proposing:
➡️ Labour Party
The Labour Party’s manifesto emphasises workers’ rights, fair pay, and job security. Their key proposals include:
- Increased ‘Day 1’ Rights: Labour plans to extend rights from the first day of employment, including entitlement to sick pay, parental leave, and protection against unfair dismissal. Currently, unfair dismissal protection kicks in after two years of employment. Labour’s New Deal document notes that probationary periods will still hold a special status.
- Raising the Minimum Wage: Labour aims to adjust the national minimum wage criteria to consider the cost of living, removing the current age bandings. This change means all adults would be entitled to the same national minimum wage.
- Banning ‘Exploitative’ Zero-Hours Contracts: Instead of an outright ban, Labour proposes requiring employers to provide a minimum number of guaranteed hours each week, reducing the uncertainty of zero-hours contracts.
- Enhancing Trade Union Rights: Simplifying the process for union recognition and making it easier for industrial action, potentially repealing the Trade Union Act 2016.
- Race Equality Act: Focusing on equal pay for ethnic minorities, protecting against “dual discrimination,” and addressing other racial inequalities.
- Employment Tribunal Time Limits: Extending the time limit to six months from the current three months.
- Menopause Support: Mandating employers with more than 250 employees to have a “Menopause Action Plan.”
- Introducing a Four-Day Work Week: One of the parties biggest sponsors would like to see the introduction of a four-day work week for all workers.
- Flexible Working Rights: Making flexible working the default option for all jobs, with employers required to justify any rejection of such requests.
➡️ Conservative Party
The Conservative Party’s manifesto focuses on flexibility and business support including:
- Fit Notes: Overhauling the fit note system to involve specialist work and health professionals rather than GPs.
- Apprenticeships and Skills Training: Expanding apprenticeship schemes and investing in skills training, including 100,000 high-quality apprenticeships by reducing university fees.
- Mandatory National Service: The source of much discussion in the media, the party propose a mandatory ‘National Service’ for 18-year-olds to help them develop life skills.
- Cutting National Insurance: Reducing National Insurance to 6% with the long-term goal of eventually abolishing it, especially for self-employed individuals by the end of the next parliament.
- Protected Characteristic of Sex: The Conservatives propose to introduce a law clarifying that the protected characteristic of sex in the Equality Act 2010 means biological sex and so an individual can only have one sex in the eyes of the law.
➡️ Liberal Democrats
The Liberal Democrats emphasise a balanced approach to workers’ rights and business flexibility:
- Increasing National Minimum Wage: Proposing a 20% increase for zero-hour contract workers during ‘normal demand’ periods and scrapping the lower apprentice rate.
- Introducing New Protected Characteristics: Adding “caring” and “care experience” as protected characteristics.
- Doubling Maternity and Paternity Pay: Increasing pay to £350 per week and making parental leave and pay a day one right.
- Supporting Small Businesses: Offering grants and tax incentives to help small businesses adapt to new regulations.
- Encouraging Employee Ownership: Promoting policies that support employee ownership schemes.
- Improving Statutory Sick Pay (SSP): Introducing SSP from day one and removing the lower earnings limit.
➡️ Green Party
The Green Party focuses on sustainability and fair employment practices:
- Living Wage Increase: Proposing a significant increase in the minimum wage to £15 per hour, with small business costs offset by reduced National Insurance payments.
- Strengthening Workers’ Rights: Enhancing protections for gig economy workers, ensuring fair pay and benefits.
- Trade Unions: Strengthening trade unions by repealing anti-union legislation and introducing a new law with the “right to strike” at its core.
- Four-Day Working Week: Moving towards a four-day working week.
- Court System Reform: Investing £2.5bn to repair and renew the crumbling court system.
➡️ Reform UK
Reform UK’s manifesto is relatively light on employment law proposals but includes:
- Scrapping 6,700 Laws: Removing laws that they believe hinder business productivity, including some employment laws.
- Equality Act 2010: Proposing to scrap the Equality Act as it currently stands, arguing that it mandates positive action that is economically damaging.
- Abolishing IR35: Supporting sole traders by abolishing the IR35 tax regulation.
- First 100 Days Pledges including increasing Personal Allowance by raising it to £20,000 and a Two Strike Rule for Jobseeker, in which they must find employment within four months or accept one of two job offers, or risk having benefits withdrawn.
What Employers Should Do Now
- Stay Informed: Keep up-to-date with policy proposals from all major parties. Understanding potential changes will help in preparing for them.
- Review Contracts and Policies: Ensure employment contracts and workplace policies are adaptable to new laws.
- Engage in Dialogue: Participate in industry groups or chambers of commerce to voice concerns and stay updated on advocacy efforts.
- Employee Communication: Keep employees informed about potential changes and their implications.
What Job Seekers Need to Know
- Understand Your Rights: Stay informed about employment rights and potential changes.
- Skill Development: Focus on acquiring new skills that are in demand, providing better job security and opportunities regardless of legislative changes.
- Be Flexible: Prepare to adapt to new employment conditions, whether it’s through flexible working arrangements or changes in job security laws.
The upcoming UK general election is set to be a pivotal event with significant implications for employment law. By staying informed and proactive, both employers and job seekers can navigate these potential changes with confidence and readiness. The landscape of work is ever-evolving, and those who adapt swiftly will find themselves well-placed in the post-election environment.
