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A New Labour Government? What does that mean for Employee Rights?

The newly appointed Labour government is definitely going to cause a lot of ripples. After 14 years under a Conservative government, there is likely to be a big swing on various issues. A lot of these changes we’ve already seen, like different approaches to Gaza, or entirely scrapping policies like Rwanda.

As solicitors that represent employees all over Glasgow, we are most interested in the Labour government’s promises outlined throughout the campaign when it comes to employee rights. A lot of changes were outlined in the Labour Party’s “New Deal for Working People” green paper. Will they all be implemented? Time will tell. However, it’s important for solicitors, employees and employers to know what to expect. We’re breaking down some of the major promises in the Labour Government’s “New Deal for Working People” and what it means for employee rights.

Introduction of a “worker” status in place of “employee”

A policy that the Labour government intends to introduce that informs the rest is the introduction of “worker” status. At the moment, the UK Government recognises “employees”, “workers” and “self-employed individuals, however, each one has a different set of rights and protections. Labour’s plan is to create a single “worker” status that will combine the current “worker” and “employee” status and bring workers the same rights as employees. It should simplify the current system but also address a lot of issues in the gig economy.

This will mean a lot of work for employee rights solicitors as policies need to be reviewed and updated and workers seek to clarify their new rights.

Unfair Dismissal as a Day One Right

At the moment, the law says that employees need two years of continuous service with their employer before they can claim unfair dismissal and take further action, however, the new Labour government has made promises to protect employees and expand that protection to “workers” by reducing that qualifying period to day one of starting your job.

The argument that the Labour government has put forward is that these changes will allow employers and workers to enjoy greater job security, particularly in sectors known for high turnover, such as hospitality and retail.

There is likely to be some pushback from employers, but hopefully, it will lead to more cautious hiring decisions and more robust and documented dismissal procedures. Companies might want to revise their employment contracts and handbooks to reflect these changes and make room for increased legal costs and compensation payments.

Employers might want to look into legal advice, and solicitors should be ready to shift focus from the idea of the time served by the employee to the merits of the dismissal.

Outlawing Zero-Hour Contracts

Throughout 2022-2023, the number of people on zero-hour contracts where estimated to be between 800,000 and 1.1 million. Boosted by COVID-19 lockdowns, the practice grew in popularity among employers as employment patterns changed. These contracts allow employers to hire staff with no guarantee of work, often leaving shift workers without a shift over various weeks without any repercussions for the employer.

The Labour government is of the opinion that this is unethical, so aims to ban zero-hour contracts entirely and introduce a minimum-hours contract to protect employees. This will allow for a more stable work environment with more reliable hours and predictable income.

There is likely to be a transitional period for companies and solicitors as employees move from zero-hour to minimum-hour contracts. Employers will need to rework their workforce planning, including scheduling and staff allocation, as well as review and rewrite their current zero-hour contracts. Disputes may arise over what constitutes appropriate fixed hours based on previous work patterns. There is likely to be an increased demand for solicitors to review and update contracts to ensure compliance with the new laws introduced by the Labour government.

Strengthen Work-Life Balance

The new Labour Government appears to recognise that the office/hybrid/remote way of working isn’t going anywhere anytime soon and aims to regulate the rights of workers to create a better system for fair work-life balance.

How they aim to do this is with flexible working rights as a default from day one of employment, the right to disconnect from work communications outside of working hours, and even an interest in looking at the four-day work week, however, that is not a firm commitment as yet.

This is likely going to be the aspect that brings in the most change and disruption to companies’ systems, resulting in a lot of work for solicitors. There will be a lot of mediation needed as contracts are reworked and policies are overhauled to reflect the new regulations.

Conclusion

There is likely to be a lot of disruption to the typical workplace system if Labour gets its policies through, which will no doubt result in a lot of work for employee solicitors. New precedents will need to be established as the growing pains of these new cases act out, which will mean a lot of reviewing, updating, and mediating disputes.