Since the publication of the Employment Rights Bill (ERB) in October 2024 (which we explored here), there have been many reactions playing out in the public domain. Most of them are relatively predictable - depending on the point of view of the individual - with the General Secretary of the TUC’s letter to the FT stating that “the Employment Rights Bill is good for business”, while 92% of small employers surveyed by FSB raised concerns about the Bill.
Although details of the plans remain thin on the ground, the potential scale of the legislative changes are giving many employers much to think about.
In this update, we explore and highlight some areas that need to be watched more closely than others.
Wide scope – wide reach
The Government’s ‘Plan to Make Work Pay’ rolled out during the General Election touted changes to many significant areas of employment legislation such as ‘fire and rehire’, ‘zero hours contracts’ and ‘day one rights’ to claim unfair dismissal – yet when the ERB was published four months ago, its proposals went even wider.
We are expecting even more changes as the Bill weaves its way through Parliament. There have been concerns raised that the lack of consultation could not only lead to poor legislation but also does not give employers any idea as to the likely outcome of the changes.
Current expectations are that the Bill will gain Royal Assent towards the latter part of the year with some changes coming into effect almost immediately and others drifting into 2026.
There are predictions that businesses should focus on certain aspects of the Bill that are likely to have an impact sooner rather than later:
· Sexual harassment – the duty to prevent sexual harassment will be strengthened by the Bill, meaning that employers currently needing to take reasonable steps will be expected to take all reasonable steps.
· Whistleblowing – the Bill proposes to amend the legislation around whistleblowing to include raising (whistleblowing) of sexual harassment as a new category of protected disclosure.
· Third party harassment – an increase to the obligation on employers to prevent this as well as sexual harassment. One thing to note is that The Times front page published on 14 January took quite an alarmist view of this, while Darren Newman’s blog was, as always, significantly more analytical and pragmatic.
· Flexible working – an increased need for an employer to justify rejecting a request for flexible working from an employee.
· Collective consultations – a proposal to make the obligation to consult where 20 or more employees are to be dismissed across an organisation rather than at one location (this was what the Woolworths case was about).
· Fire and rehire – the Bill contains protection against an employer that seeks to vary the terms of a contract without agreement leading to the employee being dismissed and then rehired on different terms. This could particularly impact businesses who seek to insist on ‘return to the office’ contractual changes.
Further developments
We will continue to monitor developments on the new Bill. Should you have any questions, or want to know more about how FeMan Consulting can support your firm following these legislative changes, please contact Mike Clyne here.