The Labour Party have secured a decisive victory in the general election, winning 412 seats with a majority of more than 170.

As part of their election manifesto, they committed to making significant changes to recruitment practices and employment laws across the UK.

Published in May, Labour’s New Deal for Working People (2024) focuses on enhancing employment security and workers’ rights.

They outline several key proposals aimed at improving job security and working conditions, including rewarding all workers employment rights from day one.

Now the general election has been concluded, it’s crucial that we understand what these proposals mean and how they could potentially impact recruitment strategies and operational procedures.

Unfair Dismissal Claims for Workers Becomes a Day One Right

As it stands, employees must accrue at least two years of service before they’re able to claim unfair dismissal in an employment tribunal. Under a Labour government, this would become a day one right.

This calls into question the legitimacy of probation periods, as well as meaning employers will need to carefully consider selecting the right hire. This may lead to the need for enhanced performance management processes and more clarity for both the employer and employee in terms of suitability for the role.

Sick Pay and Parental Leave Pay

From day one of their employment, workers will be able to claim core employee benefits, including statutory sick pay (SSP) and parental leave pay. Labour will strengthen statutory sick pay and parental leave and remove the lower earnings limit and current three-day waiting period, making it available to all workers. They will also remove the 26 week qualifying period for statutory parental leave pay, including maternity, which will also be a day one right.

This will impact businesses that employ low-paid, part-time workers. It’ll also mean employers will have to provide SSP for short-term absences.

Zero-hour Contracts

Zero-hour contracts will be banned, ensuring everyone will have the right to a contract that reflects their regular working hours based on a 12 week period. It’s important to note that this will not affect the ability of employers to offer fixed-term contracts, including seasonal work.

For employers, particularly those who offer seasonal hours, this means that they will need to offer workers fixed-term contracts with guaranteed hours or casual contracts where a minimum number of hours are guaranteed. If the employer cannot offer the worker the number of hours as agreed in the contract, they’ll be entitled to that pay regardless.

Minimum Wage

Labour plan to ensure that the minimum wage more accurately reflects a ‘real living wage’. They’ll achieve this by changing the Low Pay Commission’s remit so that as well as median wages and economic conditions, the minimum wage will need to account for the current cost of living and assess if it’s a wage people can effectively live on. Labour is also looking to remove the age bracket that allows under 21s to be paid lower rates, in favour of a flat rate that can be applied to all age groups.

Employment Statuses

Labour has vowed to reform the UK’s current three ways of categorising employment status, them being employees, self-employed or workers. These terms, which often cause confusion and are legally difficult to differentiate between, will be replaced with a ‘single status worker’ (The Labour Party, 2024). This will mean there are workers or the genuinely self-employed, with workers receiving the full employment rights and benefits that employees do currently, including parental leave pay and the right to request flexible working.

This proposal is still subject to consultation but will likely cause many organisations to reconsider how they categorise their workforce.

Sources

YouGov, 2024. ‘First YouGov MRP of 2024 general election shows Labour on track to beat 1997 landslide’. Available at: https://yougov.co.uk/politics/articles/49606-first-yougov-mrp-of-2024-general-election-shows-labour-on-track-to-beat-1997-landslide.

ViewHR, 2024. ‘What employment law changes may a new Labour government introduce?’. Available at: https://viewhr.co.uk/what-employment-law-changes-may-a-new-labour-government-introduce/?

The Labour Party, 2024. ‘LABOUR’S PLAN TO MAKE WORK PAY’. Available at: https://labour.org.uk/wp-content/uploads/2024/05/LABOURS-PLAN-TO-MAKE-WORK-PAY.pdf