Sacking a hero? How limited is the right not to be unfairly dismissed?

Posted on February 6, 2026 by Darren Newman

While we all worry about the implications of reducing the qualifying period for unfair dismissal it is perhaps worth thinking about what the right not to be unfairly dismissed actually amounts to. 

I was out with friends last night who mentioned the recently reported case of a bus driver dismissed for chasing after and ‘assaulting’ someone who has stolen a necklace from a passenger. The driver had claimed unfair dismissal and had lost despite being widely acclaimed as a hero. My friends were very much on the side of the bus driver. I made my usual noises about how the press tend to give a very one-sided view of these cases and that it was important to read the decision itself. I may also have tried to explain the range of reasonable responses test – which always goes down well on social occasions. 

I have now read the Tribunal decision and am left feeling pretty dissatisfied with it. I want to look at what the Tribunal found and the issues I have with its conclusions. But I also want to look at what the case tells us us about the law of unfair dismissal and way Tribunals approach it. 

The case is Hehir v Metroline Ltd and I am taking all of my information from the decision itself. Some facts of the case are clear and others are in dispute. I have no independent knowledge of any of them, I am just going by what the Tribunal have said. 

What happened

In June 2024 Mr Hehir was driving a bus and pulled into a bus stop. A man pushed past a female passenger who was standing by the drivers cab, pulled a necklace from her neck and ran off the bus and away up the road. Mr Hehir got out of the cab and gave chase. He recovered the necklace and returned to the bus. 

It then appears that the thief returned to the bus. There is some dispute about why he did this and exactly what happened next. The result, however, was that Mr Hehir punched him, knocking him unconscious, and then detained him for some 30 minutes while the police were called. 

Mr Hehir was subsequently arrested on suspicion of assault, but was released without charge after CCTV from the bus persuaded the police that the thief had thrown a punch at him and that he had acted in self defence. 

Metroline took a different view of the CCTV footage. Mr Hehir was suspended and an investigation was launched. After watching the footage the investigator referred the matter to a formal disciplinary hearing. There were three allegations:

  • Bringing the company into disrepute by assaulting a passenger
  • Assaulting and injuring a passenger and
  • Failing to protect his own safety and that of passengers by leaving the bus unattended and chasing an assailant 

There are two things that annoy me about the way these ‘charges’ are framed. First of all I think it is a bit much to refer to the thief as a passenger. He had been a passenger of course – but I think by the time he was punched to the ground he had very much forfeited that status. ‘Assaulting a passenger’ is an odd way to describe punching someone who had just snatched a necklace and legged it down the street. 

I also don’t like the allegation of bringing Metroline into disrepute. I think this is a term that should be used much more sparingly than it is. In this case it is inseparable from the assault allegation. We can all agree that assaulting passengers is a bad thing to do and we really don’t need to create a second allegation of gross misconduct arising from the same incident. It artificially inflates the list of charges. The risk of bringing the employer into disrepute is one of the reasons that punching passengers is not allowed.

The third allegation is obviously something that you would expect the employer to look at carefully. I can see why an employer would have rules about how to deal with incidents like this that would forbid drivers from taking matters into their own hands. We’ll come back to this point later.

The key point of dispute in the case was why Mr Hehir punched the thief. He said it was self-defence and he pointed out in the disciplinary hearing that the police had accepted that and that the case against him had been closed. The manager conducting the hearing looked at the same CCTV footage that the police had seen and reached a different conclusion. She found that the thief had returned to the bus with the ‘clear intention’ of apologising to the passenger he had stolen the necklace from – and shaking her hand (an offer she understandably declined). When he attempted to shake hands with Mr Hehir, he was pushed away. Up until then the thief had not been aggressive but he then ‘came towards’ Mr Hehir with a closed fist, but did not punch him. Mr Hehir then pushed the thief again and went on to punch him and rendering him unconscious. The manager conducting the hearing concluded that this punch was ‘intentional and unnecessary’. 

Applying the Burchell test

Now you may have an instinctive opinion about how the employer has viewed what happened. Frankly, so do I. But it is important to bear in mind what the Tribunal’s job is when deciding an unfair dismissal claim. It is not its job to decide what happened or to assess whether or not the employee is actually guilty of the misconduct alleged. The key question is whether the employer has acted reasonably and in the context of a misconduct dismissal we boil that down to a three-point test derived from the classic 1978 case of BHS v Burchell:

  • Did the employer honestly believe that the employee was guilty of the misconduct alleged? 
  • Did the employer have reasonable grounds for that belief?
  • Has the employer conducted a reasonable investigation of the allegations? 

If the answer to all three questions is yes then, provided the employer has followed a reasonable procedure and dismissal falls within the ‘range of reasonable responses’, the dismissal will be fair even if the Tribunal believes that the employee is innocent.  

In this case the key question was whether the interpretation the employer placed on the CCTV footage was a reasonable one – did it give reasonable grounds for the belief in Mr Hehir’s guilt? The fact that the police were satisfied that there was no case for him to answer is one circumstance for the employer to consider, but they are not bound by that finding. An employer might reasonably think that the police were wrong. 

So the Tribunal had to look carefully at the CCTV footage and consider not how it would interpret the events as they were captured, but whether the employer’s interpretation of them was a reasonable one. This is what the Tribunal had to say about that issue (Miss King is counsel for the claimant, Mr Hehir and Miss Caralambous is counsel for the respondent, Metroline):

61. Miss King submitted that the respondent reached a faulty interpretation of th CCTV. Miss Charalambous puts the respondent’s position on this in her closing note, especially paragraph 7. As I have noted, whilst both parties reminded methat it is not my role to decide what happened, they spent a considerable timereviewing the CCTV and cross examining on what it showed. The claimant submitted that I should find that the respondent’s interpretation of the CCTVwas flawed, the respondent that it was correct.

62. My conclusion is that the findings that the Disciplinary and Appeal Managersreached about what the CCTV showed were not faulty and were a reasonableinterpretation of the CCTV evidence. Despite extensive cross examination about the CCTV taken on a frame-by-frame basis Miss Giodric maintained her description of what she saw on the CCTV, as reflected in her disciplinary findings, and her explanation as summarised at paragraph 36 was cogent and reasonable. Mrs Dubarry spoke to the CCTV in answering cross examination and again her answers were consistent with her appeal decision and were reasonable.

And that is all we get on the subject. The tribunal is asking the right question, but I don’t feel any the wiser as to why they found that it was reasonable for the employer to differ so dramatically from the police in their interpretation of the footage. What was it the Tribunal saw in that footage that could support the employer’s interpretation? I’m not sure that this is enough to give grounds for appeal, but If I were Mr Hehir I would feel pretty aggrieved. Tribunal decisions are supposed to be detailed enough for the losing party to understand why they lost and I don’t think this decision does the job. I want more actual analysis of what we see in the footage that could lead a reasonable viewer to think that the thief approached his victim with the ‘clear intention’ of apologising and that Mr Hehir’s punch was unnecessary. 

Gross misconduct

I also have an issue with the way the Tribunal approached the third allegation – that Mr Hehir breached safety rules by going after the thief himself rather than staying in his cab and following what was called the ‘code-red’ procedure. You can see why such rules would be in place. Leaving a bus unattended, unsecured and with passengers on board is obviously something that a bus driver should not do. He knew what the proper procedure to follow was and had followed it in the past. It was brave of him to put himself at risk as he did, but an employer is entitled to instruct employees not to be brave. If they are seen to condone such behaviour that might put pressure on other drivers to behave in the same way and what would happen if one was seriously hurt as a result? I don’t think there is any escaping the fact that Mr Hehir’s behaviour warranted a disciplinary sanction of some sort. But was it fair to dismiss him for it? It was misconduct – but was it gross misconduct? 

The policy the employer relied on did not expressly say that any breach of its provisions would amount to gross misconduct. The position was that a breach might amount to gross misconduct depending on its seriousness. That seems fair enough. Here is the Tribunal’s analysis. 

68. Miss King also submitted that its failure to consider the Safety Allegation as misconduct rather than gross misconduct meant that the respondent’sinvestigation was flawed. I conclude that this submission is not supported by the facts. It is for the employer, with knowledge of its business, to make thejudgment on whether the behaviour constitutes misconduct and, if so, howsevere that misconduct is. I have reminded myself to be careful not to fall into thetrap of substitution. This employer’s policy allows safety issues to be treated aseither misconduct or gross misconduct depending on their severity and in thiscase, the respondent treated the allegations as gross misconduct and foundthem to be gross misconduct with reasons why given at the dismissal stage.

This was a claim of unfair dismissal not wrongful dismissal. In a wrongful dismissal claim – which is a claim for breach of contract – the question is whether the employee should have been given notice and the answer depends on whether they were actually guilty of gross misconduct. The Tribunal has to be make its own finding in that case of whether or not the conduct was serious enough to warrant dismissal without notice. In an unfair dismissal case the question is whether the employer was acting reasonably in concluding that there was gross misconduct for which the penalty should be dismissal.

Even allowing for that distinction, however, I think the Tribunal’s analysis falls short. It seems to suggest that the matter is entirely one for the employer to decide and does not include the caveat that the employer’s decision needs to be reasonable. There is no analysis of why Mr Hehir’s breach of the rule could reasonably be viewed by the employer as amounting to gross misconduct – what were aggravating factors that made the conduct more serious and how did the employer weigh them against the mitigating factors of the driver’s good intentions and bravery? Those issues may have been extensively discussed in the hearing – but there is no analysis of them in the decision itself. 

The limits of an unfair dismissal claim

All I have done is read the Tribunal’s decision. I wasn’t present at the hearing, I didn’t hear from the witnesses and I haven’t seen the evidence. So I am not saying that an appeal would succeed or that there would be a different outcome if the decision was overturned and sent back to a fresh Tribunal. Tribunal decisions have to be considered as a whole and should not be subjected to overly picky analysis of exactly how they have phrased particular points. All the same I think Mr Hehir has good grounds to be dissatisfied with the decision that has been handed down by the Tribunal.

But I think the wider point is just how limited the right not to be unfairly dismissed is. The employer has considerable leeway in deciding whether someone should be dismissed or not and – as this case shows – decisions that might strike many people as harsh or even extreme can be held to be fair. Unfair dismissal is a very employer-friendly right and, for all the talk of radical change, the Employment Rights Act 2025 does nothing to shift that balance. 

Posted in Uncategorized | Tagged , , , , | 2 Comments

Holiday Pay and the Fair Work Agency

Posted on January 19, 2026 by Darren Newman

One item on the list of ‘things you didn’t notice in the Employment Rights Act 2025’ is the duty to keep records relating to annual leave and holiday pay. Section 35 of the Act introduces a new Regulation 16B into the Working Time Regulations 1998 requiring an employer to keep records that are ‘adequate to show’ whether it has complied with its obligations in relation to annual leave. The form that these records take is up to the employer, but they must be kept for at least six years. Failing to keep adequate annual leave records becomes an offence. It is not yet clear when this provision will come into force – but there is no reason why it shouldn’t happen soon.

It’s not a dramatic change – but it is worth bearing mind when we look at creation of the Fair Work Agency which is expected to be set up and running this April. The Government has set a lot of store by the Fair Work Agency – but I have to confess I haven’t paid much attention to it. Oddly the Employment Rights Act itself makes no mention of it. Instead what it does is give the Secretary of State the power to enforce particular areas of employment law, allows those powers to be delegated to officials, requires the appointment of an advisory board and the publication of a three year enforcement strategy and annual reports. The Fair Work Agency will then be set up as an executive agency within the Department for Business and Trade. This means that it will have its own budget and managerial structure, but it will not be a legal entity in its own right. It will not have the independence of Acas or the Equality Commission but will carry out the labour market enforcement functions of the Secretary of State in line with Government policy. 

To an extent the agency will simply bring existing enforcement functions under one roof. The minimum wage enforcement teams currently sitting within HMRC will be transferred as will employees of the Employment Agency Standards Inspectorate – although they are already employed in the Department for Business so they won’t have to move far. The Fair Work Agency will also take over the functions of the Gangmasters and Labour Abuse Authority which the Employment Rights Act abolishes (S.148). 

None of this may seem very interesting – just an internal reorganisation of existing functions. But the Employment Rights Act also extends the enforcement powers of the Secretary of State to cover SSP and paid annual leave. That means that an employer that is not paying statutory sick pay or complying with its obligations to provide paid annual leave is subject to broadly the same regime of inspections, notices of underpayments and financial penalties that currently face employers not paying the minimum wage. If the Agency is given the resources to tackle those issues in a meaningful way then that will be an important change. 

If an employer is given a notice of underpayment in relation to an individual it will also – unless the Secretary of State provides for exceptions – be required to pay an additional financial penalty directly to the Government. The amount of the penalty is set at 200% of the amount owed to each individual covered by the notice to a maximum of £20,000 per individual. If you’re a logistics company and have wrongly assumed that your huge team of delivery drivers are not workers and so are not entitled to holiday pay, then that could prove very expensive.

And viewed in that context, the new duty to keep accurate records of paid annual leave may be significant. There is no duty on employers to keep records of Statutory Sick Pay. There used to be one, but it was revoked back in 2014. So if I were an inspector, I might struggle to audit the extent to which an employer was complying with its duties to pay SSP. When it comes to paid annual leave, however, an inspector could simply ask the employer to produce its records demonstrating compliance. If those records are not adequate then that would give good grounds for a more detailed investigation potentially leading to enforcement action. As we know, getting annual leave right is not straightforward – particularly for workers with complex working patterns or pay arrangements – so many employers may be underpaying their staff. Indeed, the Resolution Foundation has estimated that as many as 900,000 qualifying workers may be given no paid annual leave at all.  

But just how active will the Fair Work Agency be in pursuing its enforcement functions? That is the key question. There were 750 penalty notices issued in relation to the Minimum Wage in 2024/25, while the Office for National Statistics estimates that some 447,000 workers are paid less than the minimum wage. So far, Government enforcement of employment law has barely scratched the surface of non-compliance. Resources for the new agency are likely to be tight and I would be surprised if its budget allowed for any real change in the overall picture.

It might be worth double checking your annual leave records though – just to be on the safe side. 

Posted in Uncategorized | Tagged , , , , , , , , | Leave a comment

Employment Rights Act 2025 – doubling the ‘protective award’

Posted on January 5, 2026 by Darren Newman

One of the most simple and straightforward provisions of the Employment Rights Act 2025 is also one of the most consequential – at least for larger employers. Section 30 makes a change to S.189 of the Trade Union and Labour Relations (Consolidation) Act 1992 doubling the maximum level of the protective award from 90 days to 180 days.

The protective award is an odd thing in UK employment law. It is made when a Tribunal finds that an employer has failed to carry out proper consultations with employee representatives in relation to a collective redundancy exercise. There are two things about the protective award that are particularly unusual. 

The first is that it is typically a representative action. If appropriate representatives are in place – for example, a recognised trade union – and the employer fails in its duty to consult them, then the claim is brought by the representatives or the relevant trade union rather than by the individuals who are dismissed. The protective award is then made in favour of the individuals they represent and who have been made redundant – even though they themselves have not brought a claim and might not even be members of the trade union that has brought the proceedings.

The second unusual thing is that the protective award is punitive. It does not seek to compensate employees for what they have lost but to punish employers for what they have done – or rather, failed to do. 

This history of the protective award is complex, but I think it is interesting so strap in. Rules on collective redundancy consultation were first introduced by the Wilson Government in the Employment Protection Act 1975. They were designed to implement a European Directive from 1975 but in those days we had a rather vague notion of the impact of European law and the way in which the Government went about implementing the Directive would cause problems some 20 years later. 

The 1975 Act provided that an employer who was proposing to dismiss 100 or more employees had to begin consultation with any recognised trade union at least 90 days before the first dismissal took effect and an employer proposing to dismiss 10 or more employees had to begin consultations at least 60 days in advance. If fewer than 10 employees were being dismissed then the consultation simply had to begin ‘at the earliest opportunity’.

The protective award was described as an order by the Tribunal for the employer to continue paying remuneration to employees who had been dismissed or who were about to be dismissed in contravention of these requirements. The award was limited to 90 days’ pay where the consultation period was set at 90 days – and 60 days pay where the consultation period was 60 days. In cases of fewer dismissals, the maximum protective award was set at 28 days. 

Things were very different back in the 70s and it is clear that the assumption was that a union would be able to get in front of the tribunal really quickly. The protective award was designed to protect the employees from being dismissed before the consultation period was complete. Nowadays that never happens. I have never seen a case in which the protective award covered employees who were still in post. By the time they get to the Tribunal, the dismissals will have taken effect long ago.

Over the years the collective redundancy provisions were amended. Within a couple of months of the 1979 Election the Government had introduced Regulations reducing the consultation period when there were to be between 10 and 100 dismissals from 60 days to 30. The protective award in such cases was also capped at 30 days rather than 60.

The big change, however, was prompted by Europe. The UK was held to be in breach of the Collective Redundancies Directive by the European Court of Justice in 1994. The Court held among other things that UK law could not limit collective consultations to cases where there was a recognised trade union in place. The Government responded with Regulations in 1995 providing for elected representatives but also – as permitted by the Directive – introducing a threshold of 20 proposed redundancies at a single establishment before any duty to consult representatives applied.

The law was then amended by the Labour Government in 1999 abolishing the lower maximum protective award in cases where the employer proposed dismissing between 20 and 100 employees. The protective award was now capped at 90 days’ pay in all cases involving a breach of the collective consultation provisions no matter how long the consultation period was. The link between the protective award and the consultation period was further eroded in 2013 when the Coalition Government reduced the 90 day consultation period to 45 days but kept the maximum protective award at 90 days. 

The result is that the 90 day maximum has no relationship with the duration of the consultation that the employer is required to undertake. The award is no longer even pretending to offer a period of protection during which wages are paid while consultations take place. So an employer proposing to make 20 redundancies should begin consulting representatives at least 30 days before the first dismissal occurs – but faces having to give any dismissed employees up to 90 days’ pay if it fails to do so.

Nor is the amount of the award concerned with the personal circumstances of the employees who have been dismissed. An employee who is fairly dismissed for redundancy and walks straight into a better paying job with no time spent out of work will still receive a protective award if the employer failed in its duty to consult. The Tribunal must award an amount that is just and equitable having regard to the ‘seriousness of the employer’s default’ (S.189(4)(b)) rather than any losses suffered by the employee. That means that if an employer completely disregards the duty to consult then a 90-day award is likely. If the breach is more technical than substantial then a much lower figure would be appropriate. 

So what the 2025 Act does is double the risk faced by an employer obliged to engage in collective consultations over redundancy. In large-scale redundancies the financial implications of this are significant – and they are supposed to be. P&O has a lot to answer for here. When they sacked 800 employees in 2022 without engaging in any meaningful consultation, they were making a deliberate calculation. They must have judged that the amount they would save from acting quickly would outweigh the amount they would have to spend in paying out compensation to the dismissed employees. The sight of a large employer disregarding its legal obligations because it could afford to do so made a firm and lasting impression. The doubling of the limit on protective awards is designed to change the economics of situations like that and persuade more employers to engage in consultation rather than opt-out and pay-out. It is hard to argue with the logic.

The Government has said that it will implement this increase in the protective award in April this year. There is no reason why they should not keep to that timetable. No further Regulations are needed and I don’t see any need for a consultation on the issue. It’s good that at least one provision of the Employment Rights Act 2025 is so straightforward. 

Posted in Uncategorized | Tagged , , , , , , , | Leave a comment

The Employment Rights Bill reaches the endgame

Posted on December 11, 2025 by Darren Newman

It was close – but the Employment Rights Bill failed to pass last night. The Lords voted down the Government’s proposal to scrap the compensation limit on unfair dismissal and so the process of ‘ping-pong’ must continue.

There were basically two objections to the Government’s position. The first was that this was very late in the day to insert a brand new provision into the Bill. There is no escaping that. I have never come across such a major change being introduced into a Bill at the ‘ping-pong’ stage. Compensation for unfair dismissal was not even referred to at any other stage in the passage of the Bill and it is absolutely extraordinary that such a momentous amendment should be introduced at a stage were the Lords and Commons should really just be tying up the loose ends before the Bill is passed.

The second objection was intriguing. The Government insists that the abolition of the cap on compensation was agreed in a meeting between representatives of unions and businesses. It was a way of breaking the deadlock on the qualifying period for unfair dismissal. The Government was, after all, abandoning its manifesto pledge to make unfair dismissal a day one right so it needed to show that it had got something in return?

But how clearly was this agreement understood by those who were in the room? In the Commons on Monday, Lib Dem spokesperson Sarah Olney said

The Minister will be well aware that abolishing the cap was not agreed in recent negotiations between employer groups, trade unions and the Government. Most businesses would have been happy for the cap to have been increased, but completely scrapping it, without any consultation or negotiation, has understandably left employers feeling deeply worried and facing yet another nasty surprise. 

Employment Rights Minister Kate Dearden intervened and said:

With respect, I was in the room as part of the negotiations with business representatives and trade unions, and I thank them again for the constructive dialogue and leadership that they showed throughout the numerous days of conversation. I can confirm that the compensation cap was discussed and agreed in the room, so I ask the Liberal Democrat spokesperson to reflect on her comments. I was in the room; with due respect, she was not. That is a true reflection of what was discussed and agreed.

And in responding to the Debate she said:

I know that my hon. Friends’ suggestions are well intentioned, but I stress that, as a package, our amendments reflect the agreement reached between business representatives and trade unions in a collaborative and constructive process.

Perhaps a little ambiguity there in the phrase ‘as a package’? Just how specific was this agreement?

The issue was picked up again in the House of Lords. Lord Sharpe for the Conservatives said:

The Government claim that this change reflects an agreement between business groups and trade unions but I wonder whether this is true.

Neil Carberry, chief executive of the Recruitment and Employment Confederation, was explicit. He said:

“For the employer side of the table last week ‘lifted’ did not mean ‘abolished, right now’. We agreed that the 52 week cap should go—protects ordinary workers better—as part of the deal that retained the qualifying period. We anticipated a further discussion about the future of the cash cap, too. But the decision to go for abolition, now is political”.

The Federation of Small Businesses said on Times Radio this week: “In the agreement between us as business groups and the unions, we agreed that there would be a lifting of the cap. We didn’t suggest it would be both caps abolished. So that’s broader than the agreement, and it helps a very small number of very, very rich people working for corporates”.

When those alleged to have agreed to this package say plainly that they did not agree to abolish both caps, the government rationale collapses. It is rumoured that there are minutes of these various meetings and, to clear all this up, perhaps, I ask the Minister whether that is the case and, if it is, will they place a copy of the minutes in the Library?

Responding for the Government Baroness Effra said:

I will address some of the points made. Again, coming back to the nature of it all, these were discussions between business representative organisations, trade unions and the Government. Specifically on the question of the minutes, there are Civil Service contemporaneous notes of the meetings, but they have not been shared with participants or more widely. We think that it would be impolite and inappropriate to share the meeting notes without the agreement of those who attended the meetings. The Government’s statement and update on the Employment Rights Bill, released on 27 November, and the subsequent Written Ministerial Statement laid in both Houses provide the public summary and conclusion of that meeting.

So the ‘deal’ that led to this amendment was not put in writing and no-one was given notes or minutes of the meeting that agreed it. It is easy to see how the discussion of a ‘lifting’ of a cap would be understood by some in the room as a clear commitment to abolish it altogether and by others as a rather more vague undertaking to increase the maximum amount that can be awarded. Personally I think if you lift something (like an embargo) then you remove it altogether – but I know other people take a different view.

Does anyone else have that song from Hamilton running through their head?

“No one really knows how the parties get to “Yes”
The pieces that are sacrificed in every game of chess
We just assume that it happens
But no else is in the room where it happens”

I’m not sure Lin-Manual Miranda would find the current debate worth his attention. But the Lords have a good point I think that an ambiguous deal – not put in writing – between a limited number of trade union and employer representatives is not a sound basis for one of the most significant changes in employment law that has ever been proposed.

Some have argued that the change is not that significant because the median Employment Tribunal award for unfair dismissal is well below the statutory cap – and on the most recent figures is less than £7,000. I have little patience with this argument.

Tribunal awards for unfair dismissal are rare. The median figure is based on just 650 awards. The vast majority of the thousands of potential claims for unfair dismissal that arise each year are settled before that stage is reached. One factor that aids settlement is that the statutory cap means that those who have suffered very large losses will settle and never reach the stage of the Tribunal actually making the award. If you have lost £1 million as a result of being dismissed then you will quickly settle for the maximum amount. Remove that maximum and a settlement will not be easy. Daniel Barnett has recorded a podcast explaining exactly how lifting the cap will change things and I strongly recommend listening to that if you have any notion that this reform would not have a dramatic impact.

So where now? The Government are likely to act quickly so any prediction will soon be taken over by events. Nevertheless I would expect something like an agreement to carry out a full consultation on the issue coupled with amendments that would allow the Government to remove the cap by secondary legislation. Currently, Section 15 of the Enterprise and Regulatory Reform Act 2013 prevents the Government from increasing the overall cash limit on the award beyond three times median earnings. Going by the 2025 figures I work that out as being just over £119,000 – basically, about what the limit is now.

In theory the Lords could vote down any attempt to increase the limit if that did not genuinely reflect the outcome of the consultation process. In practice they seem allergic to ‘fatal motions’ (which sounds like a horrible way to go) and prefer to simply pass a ‘motion to regret’ if they are unhappy with a statutory instrument. This means that the Government could be pretty confident that it could make the changes it thought appropriate whatever emerged from the review process. Honour would be satisfied and the Bill would (finally) pass.

This is very much the endgame now. The compensation limit is the only outstanding issue that needs to be agreed. It would be a big surprise if the Government didn’t find a way to get the Bill over the line in the next round of ping-pong. But if they want that done by Christmas they will have to move quickly.

[Update: the Guardian is reporting that the Government will make no more concessions and intends to force the Bill through. It will return to the Commons on Monday and the Lords on Tuesday. Let’s see how that goes down.]

Posted in Uncategorized | Tagged , , , , , | 1 Comment

Breaking the Deadlock on the Employment Rights Bill?

Posted on December 1, 2025 by Darren Newman

Anyone reading this will know by now that the Government has made a major concession in order to break the deadlock on the Employment Rights Bill. Almost every employment lawyer I know has been saying for ages that a six-month qualifying period is the obvious compromise to make. It is a major improvement (from a claimant perspective) on the current qualifying period of two years and it avoids all the trouble of coming up with a ‘light touch’ approach to reasonableness during the initial period of employment. 

But just because the compromise is obvious, that does not mean that it was always inevitable. Without the cabinet reshuffle back in September I really don’t think we would be where we are now. It appears the compromise was reached as a result of intensive talks between trade unions and representatives of the business community but not every Labour MP will be happy about it. After all, a day one right to claim unfair dismissal was an express manifesto commitment. So it makes sense that concessions had to be made on the employer side to sweeten the pill. 

Lifting the Cap

But what exactly were they? Here is what the Government press release says:

“To further strengthen these protections, the Government has committed to ensure that the unfair dismissal qualifying period can only be varied by primary legislation and that the compensation cap will be lifted. ” 

Removing the ability of further changes to the qualifying period by statutory instrument makes sense. But what really took me aback was the reference to lifting the compensation cap. Where did that come from? And what exactly is the Government proposing to do? 

At the end of last week a number of us over on LinkedIn were looking at what this might mean and exactly how the law might be changed. In this post I want to set out the options as I see them. I won’t credit the individuals over on LinkedIn who have helped me try to understand what is going on and what might be proposed – but if you follow me over there you can see who was involved in the discussion. 

But first I want to set out a bit of the history of unfair dismissal compensation.  

Compensation limits through the ages!

In the Industrial Relations Act 1971 the new right to unfair dismissal was introduced with an overall limit on compensation set at either 104 weeks’ pay or £4,160 – whichever was the lower. For a bit of context, using the Bank of England’s Inflation calculator, £4,160 comes out as the equivalent of just over £53,000 today.

The annual increase I the limit continued to fall behind inflation – and even further behind wage inflation. When Labour came to power in 1997 they increased the limit from £11,300 to £12,000 but had a more radical change in mind. The Fairness at Work White Paper in 1998 said: 

“3.5… Although many awards are well below the current limit on compensation, which the Government has recently increased, the existence of a limit prevents some individuals from being fully compensated for their loss. The likelihood of proper compensation being awarded should also encourage employers to put proper voluntary systems in place. The current cap on compensation for unfair dismissal, which has steadily fallen in real terms, provides no such incentive. The Government therefore proposes to abolish the maximum limit on such awards.”

In the event the Government was persuaded not to abolish the limit altogether – but they did increase it significantly to £50,000. They also provided for that sum to be increased in line with inflation each year. Then in 2013 the Coalition Government introduced a new limiting factor. Instead of a simple limit on compensation – and in an echo of the 1971 Act – compensation was limited to the lower of a fixed sum of £74,200 and 52 weeks’ pay. That fixed sum has since increased with inflation and is now set at £118,223. 

So that means that someone earning £50,000 – a bit above national median earnings – has their compensatory award capped at one year’s pay. Someone earning £1,000,000 a year on the other hand can only get £118,213 – just over six weeks’ pay. Poor them.

Unfair dismissal compensation can be quite unpredictable. The compensatory award is based on the employee’s financial losses arising from the dismissal. If the employee finds a new job within the year then that will likely mean that their overall loss is below 52 weeks. A Tribunal also has a wide discretion to reduce the amount awarded to reflect the possibility that the employee would have been dismissed even if the employer had behaved reasonably or because of the employee’s ‘contributory fault’. 

Nevertheless for many potential claimants the limit on compensation for ordinary unfair dismissal is a frustration and means they will recover less than the amount they have lost. There is of course no such limit on discrimination cases or in cases where the employee was dismissed for making a public interest disclosure (whistleblowing). As a result, there are undoubtedly some cases where an employee seeks to shoehorn a discrimination or whistleblowing claim into what would otherwise be a normal unfair dismissal case – though opinions vary on the extent to which that is an issue. 

Labour’s pre-election approach

When the Employment Rights Bill was published back in 2024 it did not seek to make any changes to compensation for unfair dismissal. Nor was the issue mentioned in the Labour Manifesto or “Labour’s Plan to Make Work Pay” – the policy document that the manifesto promised to implement in full. 

But the proposal that was abandoned in 1998 is still discussed in Labour circles. Back to 2022 Labour’s Employment Rights Green Paper said: 

“Caps which limit the amount of compensation that workers can receive are unfair and discourage companies from following the law. Labour will ensure that workers will receive full compensation, without statutory limits, if they suffer loss because of employers’ breaches of the law.”

That Green paper emerged from Labour’s “Power in the Workplace Taskforce” chaired by Andy Mcdonald MP who soon afterwards resigned from Keir Starmer’s Shadow Cabinet citing a lack of support for his proposals to increase the Minimum Wage. So the Green Paper did not exactly emerge from Starmer’s inner circle. But it was still published and it’s proposal on compensation  would instinctively be supported by many Labour MP’s 

Options for ‘lifting the cap’

So given that background what do we think the Government is actually proposing? There are I think, three main options.

  1. Abolish all limits on compensation for unfair dismissal
  2. Abolish (or substantially increase) the limit of 52 weeks’ pay but keep the overall limit of just over £118,000 and continue to increase it in line with inflation
  3. Increase the overall limit  by a significant, above inflation amount

I don’t know what deal has been done or indeed how specific the Government was when it made its deal to accept a six-month qualifying period. But it does seem to me that the most sensible option is to remove the 52-week limit imposed under the Coalition and revert to one overall limit that is uprated each year in line with inflation. 

Such a change would chiefly benefit workers on average (or just above average) wages. Those on low wages, without much in the way of pension entitlement, are unlikely to get anywhere near the 52 week limit if they are dismissed unfairly but not subject to any form of discrimination. 

But abolishing the limit altogether would mainly benefit those earning well above the average. It would also be disastrous for the Employment Tribunal system. Imagine an investment banker who claims unfair dismissal because he was not given an opportunity to improve his performance before being dismissed. With salary, bonus, share options and pension contributions his losses could easily run into the millions. That would be a claim worth investing in and he would be able to afford top-flight lawyers to represent him. The employer would also need to be seriously lawyered up and would put a great deal of effort into defending the case. Every issue would be litigated and much more Tribunal time would be taken up than for a normal unfair dismissal claim – crowding out claims from those who might be in much more need of the compensation they are seeking. 

I am not at all convinced that the parties in a case of that sort should have recourse to the Employment Tribunal system where there are no fees to pay and no significant cost risk if they lose. Altogether I think it would be odd if a Labour Government made a change that would mainly benefit the very highly paid (and those who represent them). 

As I write this, we don’t know what the Government’s proposal actually is. That in itself is a bit puzzling. The press release was ambiguous and we still don’t have any formal announcement clarifying the position. Perhaps there is all sorts of wrangling going on in the background. Perhaps there is a technical issue about whether it is now too late to make an amendment to the Bill that introduces a whole new topic rather than fine tune the detail of a provision that is already in there. Could it even be that talk of a deal is premature? 

We should find out very soon. The Bill returns to the Commons on 8 December and before then we should get an amendment paper indicating just what the Government is actually proposing. So far, the Bill’s website has posted 139 amendment papers since the Bill was introduced. Number 140 is going to be very interesting.    

[UPDATE: Actually I was wrong about that. Number 140 is just a single amendment from Andy McDonald MP insisting on rejecting the Lords amendment to the qualifying period. This is backed by a group of left wing MPs and will be rejected. We still need to see what amendments the Government puts forward]

Posted in Uncategorized | Tagged , , , , , , , , | 2 Comments

The Employment Rights Bill and day-one rights

Posted on October 29, 2025 by Darren Newman

The Employment Rights Bill failed to clear the final stage of its passage through Parliament last night. The House of Lords chose to insist on a number of amendments that had been rejected by the Commons meaning that the Bill must now go back to the Commons to see if they insist on rejecting the amendments that the Lords are insisting on – or whether some sort of alternative amendment (referred to as an amendment in lieu) can be made that the House of Lords could live with.  For obvious reasons, this stage of the process is known as ‘ping-pong’.

In this post I want to concentrate on the amendment concerning the unfair dismissal qualifying period – where the Lords have insisted on a six month qualifying period rather than allowing unfair dismissal to be a ‘day-one right’. It struck me, watching the debate, that the Government has got itself into a bit of a mess. 

The current position – understood by everyone with any involvement in employment law – is that in order to claim unfair dismissal an employee must have two years’ continuous service with their employer (I’m just going to ignore the lack of a qualifying period for ‘automatic’ unfair dismissals for reasons such as whistleblowing or belonging to a trade union). That requirement is found in S.108(1) of the Employment Rights Act 1996. Importantly the two year qualifying period can be amended (or scrapped) by Regulations under S.209 of that Act. So when the coalition government of 2010-2015 wanted to increase the qualifying period from one year to two years back in 2012 it did not need to get a Bill through Parliament to do that, it simply issued an Order which took effect after a single resolution in each House of Parliament. 

Labour’s 2024 manifesto was very clear. It committed the new Government to:

introducing basic rights from day one to parental leave, sick pay, and protection from unfair dismissal. 

It is important to remember in all this that the total abolition of the qualifying period for unfair dismissal is an unequivocal manifesto commitment on which all Labour MP’s stood at the last election. It cannot be abandoned lightly. 

Making this change would not need primary legislation – it could be done using the same sort of Order that was used to increase the qualifying period back in 2012. Given it was a manifesto commitment, it is difficult to see how that could be opposed in the House of Lords. 

But the Employment Rights Bill went further than just disapplying the qualifying period – it repealed S.108 altogether and removed any reference to it from S.209. This would mean that a future Government could not simply reintroduce it with an order of its own – a fresh Act of Parliament would be required. 

In order to try to reassure employers, however, the Government provided for special rules to apply during an ‘initial period of employment’. The details are to be worked out after consultation which means that the Government is currently unable to explain how this would work in practice. I think it is a needless complication. Indeed when I considered the option of something like this before the Bill was published, I said it would be an ‘abomination’ and that I would stand outside Parliament with a loudspeaker protesting about it. Please don’t hold me to that. 

Business was not however reassured and just last week the Resolution Foundation published an article entitled ‘Day One Frights’ (well done) which said that the total abolition of the qualifying period would have the potential to inhibit hiring and could be particularly damaging to younger workers looking for their first role. It really is a very cogently argued piece and is well worth reading. The conclusion was that the qualifying period should be reduced to six months. 

As it happens, that mirrors an amendment made by the House of Lords at the Report stage and which was rejected by the Commons when it considered the Lords amendments in September. When the issue came back to the Lords to be debated yesterday the Government frontbenchers really struggled to make a coherent case – it was quite painful to watch. The Resolution Foundation’s position was referred to time and again by the Opposition and the Government seemed to have no answer to it. Of course they weren’t helped by the fact that the ministerial team was new to the issue following the reshuffle back in September.

Breaking the deadlock

So what is the Government to do? It surely can’t abandon such a clear manifesto commitment? Here is my suggestion. 

Why not accept a six-month qualifying period – for now – and pledge to work towards a total abolition in the future?  That means replacing the current House of Lords amendment (which has some technical issues and which currently – and bafflingly – has the ‘initial period employment’ beginning at the end of the first six months of employment) with something much shorter and cleaner which would: 

  • Keep S.108(1) in place but specify a qualifying period of six months
  • Provide that there will be no qualifying period where the dismissal was due to a spent conviction within the meaning of the Rehabilitation of Offenders Act 1974 (this was inserted in the Bill by the House of Lords and is so obviously a good idea that it is rather surprising that it is not already in the Employment Rights Act)
  • Scrap all references in the Bill to special rules applying during an ‘initial period of employment’ and save us all a lot of needless hassle 
  • Keep the ability under S.209 of the Employment Rights Act 1996 to amend or disapply the qualifying period for unfair dismissal in the future. 

The Government could then make it clear that it still has the ambition of making unfair dismissal a day one right but that it accepts that work needs to be done to make sure that this does not deter employers from hiring and that the economic conditions need to be right. It can then ask Acas to work on guidelines for a fair way of operating probationary periods and only commit to abolishing the qualifying period altogether when there is broad consensus as to what that involves. Any future change would be made by Order and the power to reintroduce a qualifying period would be retained should it become clear that the lack of one is inhibiting growth. 

Since there would no longer be any need to spend a year working through the details of the ’initial period of employment’ the Government could also announce that the qualifying period will be reduced to 6 months in April 2026 rather than at some time in 2027 as currently planned. If they were feeling cautious, they could also phase it in with Regulations reducing the qualifying period to 12 months in the first instance. 

Taking this approach would mean that the manifesto pledge remains on the table and that tangible progress would be made towards it much more quickly than is currently envisaged by the Government’s implementation timetable. It would also be a clear win for the Government. After all they will have persuaded the Conservatives that a six month qualifying period for unfair dismissal is reasonable and will not deter employers from taking people on. Had the Bill started with a six-month qualifying period I very much doubt that they would have been prepared to accept that.  

Implementing the Employment Rights Bill is a huge task and there are a number of areas where the Government is going to struggle (I still think that the whole guaranteed hours thing is a disaster waiting to happen). Accepting – for now – a six-month qualifying period allows the Government to make a tangible improvement in workers’ rights and also provide some reassurance to the business community. I think it would be a smart move. Let’s see what happens. 

Posted in Uncategorized | Tagged , , , , , , | Leave a comment

Government consults on Pregnancy Dismissals

Posted on October 27, 2025 by Darren Newman

We all know that it is unlawful to dismiss an employee either because she is pregnant, for a reason connected with her pregnancy or because she has taken maternity leave. In fact the combination of the pregnancy and maternity provisions of the Equality Act 2010 or the unfair dismissal provisions in Regulation 20 of the Maternity and Parental Leave etc Regulations 1999 means that employees who are pregnant or have recently given birth are pretty well protected against dismissal (on paper, at least).

So why have the Government just launched a consultation on “Enhanced Dismissal Protections for Pregnant Women and New Mothers”? What problem are they seeking to address? 

Labour’s pre-manifesto policy document – ‘Labour’s Plan to Make Work Pay’ – said:

‘Labour is committed to strengthening protections for pregnant women by making it unlawful to dismiss a woman who is pregnant for six months after her return, except in specific circumstances. This will give new mothers certainty that the law is on their side.’

And that was all it said. No analysis of what the law currently is, why it is unsatisfactory or what ‘specific circumstances’ might be appropriate when considering the dismissing an employee who is currently or recently pregnant. 

The reference to ‘specific circumstances’ is interesting. Article 10 of the EU Pregnant Workers’ Directive says

“1. Member States shall take the necessary measures to prohibit the dismissal of workers, within the meaning of Article 2, during the period from the beginning of their pregnancy to the end of the maternity leave referred to in Article 8 (1), save in exceptional cases not connected with their condition which are permitted under national legislation and/or practice”

While we were in the EU there was an argument that UK law did not go far enough. It prohibited discrimination because of pregnancy but did not provide that dismissal of pregnant women was only allowed in ‘exceptional circumstances’. Is the ‘Making Work Pay’ proposal an echo of that concern? 

We are no longer bound by the Pregnant Workers Directive, but in any event it seems that our law was probably fine anyway. In 2018 the European Court of Justice ruled in Porras Guisado v Bankia SA that provided the dismissal was not connected with the pregnancy and the employer gave substantial reasons for it in writing there was no breach of the Directive. In the UK pregnant workers are indeed entitled to written reasons for dismissal (see S.92 Employment Rights Act) and if those reasons are connected with pregnancy the dismissal will be unfair.  So there is no international standard that requires dismissal only be allowed in ‘specific circumstances’   

What the Employment Rights Bill provides

When the Employment Rights Bill was published the new Government’s policy was reflected in a Regulation-making power. The Bill amends S.49D of the Employment Rights Act 1999 which is the statutory basis for the 1999 Regulations dealing with the duty to offer suitable alternative work in relation to an employee who becomes redundant during pregnancy, maternity leave or within 18 months of the birth of a child. Essentially the power to make regulations is extended so that instead of just covering redundancy they can cover any dismissal ‘during or after a protected period of pregnancy’. It pretty much gives the Minister a free reign in deciding what additional protections against dismissal should be introduced. 

But that still doesn’t answer the question: what shortcoming in the law is this consultation intended to address? Nobody sought to answer that question as the Bill went through Parliament. Indeed in Committee, Conservative shadow minister  Greg Smith said: 

“ I think this is one of the least contentious parts of the Bill, and we do not seek to oppose in any way the important protections for pregnant women and new mothers”

Which is fine – and very generous given that he could not be expected to know what these important protections will actually be. 

What the new consultation is about

The consultation that was launched last week gave the Government an opportunity to explain exactly where they think the current law is lacking and what extra protections are needed. Do they set out a clear case? Take a guess.

It seems to me that there are two possible bases for amending the law on pregnancy dimsissals. 

The first is that despite the prohibition on dismissals connected with pregnancy, there is evidence that such dismissals remain a problem and so the law needs to be changed to make it easier for claimants to assert the rights that they currently enjoy in theory but do not always benefit from in practive. 

The second is that the law is currently insufficient in that it allows for employees to be lawfully dismissed in circumstances where a dismissal should be unlawful. In other words that there is a gap in the law that needs to be filled. 

It looks as though the Government is relying on the first ground as justifying action:

“While legal protections against dismissal related to pregnancy and maternity already exist. And was strengthened in 20/23/24 to include enhanced redundancy protections. Many expectant and new mothers continue to report experiences that suggest unfair treatment persists.

This is deeply concerning and highlights the need for further action. That is why this government will put in place legislation that makes it unlawful to dismiss pregnant women, mothers on maternity leave and mothers who return to work for at least the six-month period after they return (“The protected period”) except in specific circumstances.”

The problem however is that having identified the problem of unfair treatment persisting despite the law that is already in place, the Government assumes that the answer is to widen the law rather than look at issues of enforcement. Not only that, but the consultation is not informed by any clear idea of what circumstances justify dismissing someone during the ‘protected period’. Rather, we are being asked what the ‘specific circumstances’ under which dismissal is permitted should be. 

A new test of fairness?

The consultation basically offers up two options for considertation. Option 1 would introduce a new test of fairness that would apply to all dismissals of protected employees. This would be a stricter standard than the current test of reasonableness. 

Here is what the Government suggests under this option: 

35. Option 1: Introduce a new general test for fairness 

Under this option, employers would still be able to rely on any of the existing fair reasons for dismissal, but they would also be required to meet a new stricter standard when relying on that reason to dismiss a pregnant woman or new mother. 

Example: Employers could still be required to show a fair reason, and also show that letting someone go is, for instance, necessary to avoid serious harm to the business or other staff.

And that is it. No other discussion of ‘Option 1’ is set out in the consultation. Nowhere does the consultation expand on what ‘serious harm’ to the business might mean. And of course this is only an example of what the stricter test might be. The Government is inviting other suggestions as to what test should apply – which very open minded of them – but really serves to emphasise that the Government does not have a clear idea of what problem it is trying to solve. 

Limiting the reasons for dismissal?

There is a much more detailed discussion of Option 2 – but mainly to point out what a bad idea it is. Option 2 is expressed as narrowing the scope for dismissal or ‘removing some of the fair dismissal reasons’. This refers to what are generally known as the ‘potentially fair reasons for dismissal’ set out in S.98 of the Employment Rights Act 1996. Technically they are categories of reason rather than reasons in their own right, but don’t get me started on that point. To all intents and purposes the employer msut show that the dismissal was for one of the following reasons: 

  • Conduct
  • Capability
  • Statutory Ban
  • Redundancy 
  • SOSR (often pronounced ‘sozzrer’ this stands for ‘some other substantial reason’)

So under Option 2  one or more of the reasons on this list would not be available to an employer who had dismissed a protected employee. The Government accepts that this would lead to difficulties and gives a number of examples illustrating this. 

Let’s take conduct. The suggestion is that the law might only allow for dismissal in cases of gross misconduct rather than ordinary misconduct. Quite fairly the Government then asks about dismissals for multiple instances of ordinary misconduct. Here is the first hypothetical example it comes up with. 

“Example A. An employee repeatedly ignores safety protocols in the workplace, such as failing to wear required protective equipment. On two separate occasions, the employee receives a formal warning in line with the employer’s disciplinary policy. Shortly after receiving the second warning, the employee informs her employer that she is pregnant. During the predicted period to the employee again disregards a key safety rule and this incident results in the minor injury to a colleague. Several team members raised concerns with management, stating that the repeated behaviour is creating an unsafe work environment and affecting morale.”

Or how about this?

“Example B. A pregnant employee uses insensitive language relating to race in front of their team. A single incident of using this specific language would not usually be sufficient for dismissal, according to the employer’s policy on conduct, but it would usually merit a final written warning. A month later, while still pregnant and at work, the employee uses the same form of words again in front of a customer who complains to management.”

I think these examples neatly illustrate That carving out some sort of exception under which pregnant employees could not be dismissed for misconduct in the same way as their colleagues would be completely unworkable. Surely nobody is going to suggest that a pregnant employee should have more licence to use racist language in front of customers than someone who is not pregnant?

Issues around capability are more complex. Clearly, there are circumstances in which the fact that someone is pregnant will affect the way in which they do the job and can also affect their attendance. Issues of performance may also arise when an employee returns to work after the extended period of leave – particularly if there has been a change in the way the work is organised or performed while the employee was away. It is important to remember that to a large extent, the law already protects women in these circumstances. Pregnancy related absence cannot be taken into account when dismissing an employee for poor attendance. And where pregnancy has affected the employee’s performance in the role any dismissal would be likely to amount to discrimination as well as being automatically unfair. 

What is this all for?

The truth is I just don’t understand what the Government is trying to achieve by changing the law. Is the argument that employees who happen to be pregnant should be protected from dismissal in circumstances where the dismissal is not in any way related to their pregnancy? Or is the underlying justification for a special rule protecting pregnant employees and new mothers that while they may be protected on paper, they are not necessarily protected in practice? 

If it is the latter then surely any change in the law needs to focus on how existing rights can be enforced. I appreciate that asking for a swift and efficient Employment Tribunal system is unrealistic, but perhaps the law could do something to make it easier for dismissed employees to win their case? I can quite see that a current problem might be that an employer could make an employee redundant without giving any indication that the decision was prompted by their pregnancy or maternity leave but where the employee strongly suspects that there was a link. If we want to address that issue then maybe we should focus on the burden of proof rather than the definition of when a dismissal will be fair. 

Suppose you provided that if an employee is dismissed during the ‘protected period’ it falls to the employer to prove that pregnancy or maternity played no part in the decision to dismiss. If the employer passed that test the Tribunal could go on to consider the fairness of the dismissal in the normal way. If it could not, then the dismissal would be unfair. 

In a case of gross misconduct, passing the test should be straightforward. A Tribunal might easily be persuaded that anyone who, for example, stole money from the till would be dismissed and that the employee’s pregnancy was neither here nor there. On the other hand an employer who dismissed an employee whose output suffered in the later stages of her pregnancy might struggle to prove that her poor performance was unconnected with her condition. In cases of redundancy the Tribunal could take some persuasion that the selection of the employee had nothing to do with the fact that she was pregnant or on maternity leave.

Choosing Option 3

Of course employers already have to prove the reason for dismissal under unfair dismissal law, but I still think that placing a particular burden on employers who have dismissed a pregnant employee (or someone on leave etc) would move the dial significantly in the employee’s favour. It would go further, for example, than the convoluted burden of proof provisions in the Equality Act which could also be amended to keep the test consistent. It would also have the advantage of not interfering with the fundamental test of when the dismissal of an employee is fair, would be easy to draft and would not involve employers having to apply different rules or procedures to different employees when contemplating dismissal. 

As an added bonus, such a change would bring UK law into line with Article 8 of the International Labour Organisation’s Maternity Protection Convention (No 183) which provides:

“It shall be unlawful for an employer to terminate the employment of a woman during her pregnancy or absence on leave referred to in Articles 4 or 5 or during a period following her return to work to be prescribed by national laws or regulations, except on grounds unrelated to the pregnancy or birth of the child and its consequences or nursing. The burden of proving that the reasons for dismissal are unrelated to pregnancy or childbirth and its consequences or nursing shall rest on the employer.”

So given the choice between Option 1 and Option 2, I am going to add in Option 3 – placing the burden of proof on the employer to show that the dismissal was unrelated to pregnancy or maternity. Will making such a change solve the problem? Of course not. But the problem is not really the result of the current rights being too narrow. If employers can still dismiss employees for reasons connected with their pregnancy or maternity leave then that is a failure of the system we have developed to enforce and uphold existing rights. I don’t think anything suggested in this consultation is likely to address that. 

Posted in Uncategorized | Tagged , , , , , , , | 2 Comments

Winter is coming – waiting for Employment Rights Bill consultations

Posted on October 15, 2025 by Darren Newman

I’ve always loved autumn. Oddly it’s always felt like the start of a year to me rather than the end of one. It’s a very flexible season too – when would you say it actually gives way to winter? The end of November? Later? 

It’s worth asking because the Government has committed to consulting on a range of issues over the course of this autumn as part of its implementation programme for the Employment Rights Bill (still just a Bill at the time of writing). When the Bill becomes an Act nothing will change immediately. Some measures (mostly to do with the effective repeal of the Trade Union Act 2016) will come into force two months after Royal Assent. Other measures, however, have to be brought into force by the new Minister for Employment Rights, Kate Dearden MP. Over the summer, the Business Department published a timetable for implementing the Bill and the new Business Secretary Peter Kyle. confirmed in the Commons that the Government intends to stick to it (see Column 1208). 

Most of the key measures in the Bill are due to be brought in over the course of the next two years. Importantly many of them need further secondary legislation to be introduced in order to flesh out the sometimes sketchy details we have in the Bill itself. Before those Regulations can be introduced the Government needs to consult on what exactly they should say. 

So the timetable sets out the consultations that the Government intends to conduct and when those consultations will be launched. An awful lot of them are due ‘in the autumn’ of this year. I thought it would be worth looking at just how much the Government has committed to producing before winter sets in.

[UPDATE: 23 October 2025. Four consultations were published this morning and I plan to keep updating this post as more of them come in. See below for the details of each and links to the consultation documents. I would just note at this stage that we do not yet have consultations on the most difficult topics. The fact that as of today we still don’t have a consultation on union ballots makes me even more doubtful that we will see a change in the rules as early as next April, though I’m ready to eat my words on that if need be]

The School Staff Negotiating Body

The Bill paves the way for a negotiating body to determine the pay and conditions of school support staff across England.  This will cover academies as well as all schools run or maintained by local authorities. The basic idea is that the body will reach an agreement about terms and conditions, training or career progression and submit those agreements to the Secretary of State. If they are ratified, then Regulations will be issued which will then become incorporated into the contracts of employment of the relevant staff. 

There is a lot to be sorted out before this body can be up and running. Given that it applies not just to local authority schools but also academies there is the question of how employers will be represented. Unions also will have to decide who represents the workers side and that may depend to an extent on exactly which non-teaching staff the body will cover. These are all matters that will need to be covered by the consultation. I would hope that discussions have already been taking place behind the scenes so that the consultation will be able to chart a clear way forward that will command widespread agreement. 

Adult Social Care

The Bill also provides for the creation of a similar negotiating body for the Adult Social Care Sector. Here the Government has already made considerable progress and a detailed consultation about the operation of that body has already been launched and will run until 16 January. The body itself is due to come into existence in the autumn of 2027 with the first agreement being ready for ratification by April 2028. I’d say that seems doable. 

Unfair Dismissal

Day one rights for unfair dismissal is one of the key provisions in the Bill. While abolishing the two-year qualifying period is in itself straightforward, the Government has decided to complicate the issue by legislating for an ‘initial period of employment’ during which a different standard of reasonableness will apply. I have deep reservations about this but we are where we are. The qualification period is currently scheduled to remain in place until 2027 to allow the proposals for the initial period of employment to be developed and for Acas to reflect them in an amended Code of Practice. Re-drafting a key Acas Code is no small matter and so it is important that the Government starts consulting on this soon. This is a key consultation to watch out for. 

Trade Union Measures

The Government intends to consult on a range of trade union measures. Three are worth highlighting. First of all, the Bill requires an employer to give workers a statement – alongside the written statement of terms and conditions – informing them of their right to join a trade union. Regulations are needed to specify exactly how that statement should be given and what other union rights it should refer to.

A more controversial measure is the trade union right of access which will allow trade unions access to a non-unionised workplace for the purposes of meeting the workers to provide support and representation as well as seeking to recruit them to union membership. This will all be covered by a union access agreement which the union will agree with the employer or which – where no agreement is reached – will be imposed by the Central Arbitration Committee. Detailed Regulations are needed to flesh the process out and make it workable and the Government intends the new right to be in place by October 2026. There are some very large and influential employers who are going to have a problem with this so the lobbying will be fierce. 

The third measure relates to ballots for industrial action and other trade union matters. Technically the Bill does not introduce anything new here – it merely nods in the direction of Section 54 of the Employment Relations Act 2004. This allows Regulations to specify the ways in which ballots may be conducted – which would include electronic or workplace ballots. The Government’s intention is to allow industrial action ballots to be conducted either electronically or in the workplace by April 2026. To meet that deadline they really need to get moving. The Regulations governing workplace or electronic ballots will be complicated and lots of stakeholders will want to contribute to the consultation. To be honest, I really don’t see this measure coming into force by April – but we shall see.

[UPDATE 23 October 2025: Two consultations have been published.

The consultation on the Trade Union Right of Access can be found here. It seems quite straightforward – I suspect the main pushback from employers will be the very tight timescales for decided whether to agree to access and to negotiate the access agreement itself. The consultation closes on 18 December 2025 and there will be a further consultation in the Spring of 2026 on a Code of Practice. Implementation in October 2026 seems doable.

The consultation on the duty to inform employees of their trade union rights can be found here. It also closes on 18 December and the new right will be introduced in October 2026 alongside the right to access. It seems that the statement will have to be quite detailed and I suspect it will end up being a government drafted statement that employers will have to give employers with some room for the employer to fill in the details of any trade unions it recognises. Employers might not like the suggestion of having to re-issue the statement every six months, which is one of the options, but otherwise this is not a particularly onerous requirement] 

Fire and Rehire

I’m a bit puzzled by this one. If you’ve read this blog before or heard me speak about Employment Rights Bill you know that I am not a fan of the Bill’s provisions effectively banning fire and rehire – but I don’t see that there is much to consult about before the scheduled implementation date of October 2026. There is a power to make Regulations extending the definition of a ‘restricted variation’ – but no need to exercise that power before bringing the new right in. Perhaps the Government is thinking about an amendment to the Code of Practice on Dismissal and Reengagement. That will certainly need to be withdrawn, but I don’t really think we need to consult on a new one. The circumstances in which fire and rehire will be permitted are so limited that I’m not sure a code of practice will have much to say other than ‘don’t do it’. Still, I’ll be interested to see what the Government wants our help with.

Regulation of Umbrella Companies

Nothing to do with protection against the rain here. Umbrella companies act as the employer of essentially self-employed or freelance workers who are doing work – often quite specialised work – for client companies. You could see them as freelancers clubbing together to take care of tax and other issues, but they could also be operating like employment agencies. The Bill amends the Employment Agencies Act 1973 to bring them within that regularory framework. Quite what consultation is needed before this happens I don’t know. Perhaps I’m missing something. Please let me know in the comments if this is an issue close to your heart.

Bereavement Leave

We currently have a right to parental bereavement leave which gives two weeks’ leave to parents who lose a child. This is paid at the equivalent of the lower rate of SMP (currently £187.18 per week). The Bill extends this to cover bereavement more generally as well as pregnancy loss. The details of the right are to be set out in Regulations (as they currently are for parental bereavement leave)  and with a consultation this autumn the Government should be ready to implement the new right in 2027. It may seem surprising that it will take that long, but since employers can recover statutory bereavement pay from the Government via their NI contributions it is actually quite complicated to get all the various systems in place to allow for that. 

[UPDATE 23 October 2025. The government has published its consultation which you can find here. Given the limited nature of the right I don’t expect it to case much controversy – although there may be some debate about what relationship the employee needs to have to the deceased person in order to claim leave. Consultation closes on 15 January 2026]

Rights for Pregnant Workers

It really isn’t very clear what the Government has in mind here. The Bill makes an amendment to S.49D of the Employment Rights Act 1996 which allows for Regulations dealing with redundancy during or after pregnancy. This widened to cover dismissal more generally and provides for regulations that might require particular procedures to be followed or evidence to be provided before someone who is pregnant can be lawfully dismissed. This might be a radical change or it might be altogether more modest and so the consultation process will be crucial. The Government intends to consult this autumn with a view to introducing the new rights – whatever they may be –  sometime in 2027.

[UPDATE 23 October 2025. The Government has now published its consultation and you can find the full details here. The consultation leaves the question of what protections will be provided very much open and I’ll be blogging more about what it says in future posts. The consultation ends on 15 January 2026]

Ending the Exploitative Use of Zero Hours Contracts

I wish the Government luck with this one. Clause 1 of the Bill sets out the framework for employers having to offer guaranteed hours to workers on zero hours contract or whose contractual hours fall below a specified number. It is a hugely complex provision and drafting the Regulations that will be needed to make it work is a mammoth task. By my count there are about 15 things that the Minister will have to decide before the Regulations can be finalised – including who the new right will apply to, what pattern of work will trigger the duty to make an offer and how that offer will have to be framed in order to reflect the workers’s pattern of work over the reference period. If any provision of the Employment Rights Bill is going to be left on the back burner it is this one and the first key test is whether the consultation really does materialise this autumn and whether, when it does, there is any sign that the Government has thought through exactly how the new right will work.

Winter is Coming…

So that is nine sets of consultation due to be launched this autumn. As I write this one has been launched and the remaining eight are pending. My plan is to update this post as the new consultations are produced [see above!]. Perhaps they will all come out in the next week or so [some did]– or perhaps some will take longer than others [so it seems]. The new Minister has a lot on her plate – as do the civil servants who have to produce the consultations documents which will explain the proposals and their background and assess their likely impact. Spare a thought too for the policy people working in trade unions and employers’ organisations who will need to consult their members and formulate their responses within a very tight timescale. We might even have some sympathy to spare for the professional lobbyists who are facing a busy – though lucrative – autumn.  

I can’t remember a time when so many consultations of such importance were scheduled to take place in such a short period of time. If any of them slip into next year then that will have a domino effect – more consultations are already due early next year. If there is any slippage then some may start to doubt the Government’s overall commitment to implementing the Bill in full before the next election. It’s going to be fun to watch.

Posted in Uncategorized | Tagged , , , , , , | 2 Comments

Fire and rehire in local authorities

Posted on September 29, 2025 by Darren Newman

The Guardian this morning cites union concerns that the Employment Rights Bill is being watered down. It mentions specifically the ban on ‘fire and rehire’ and the ‘financial difficulties’ exception that will apply to local authorities. As the Guardian puts it:

“Under the amendments, councils will gain the ability to sack and rehire workers on worse pay and conditions if they are in financial distress – an opt-out already secured by private-sector organisations.

The bill is due to gain royal assent in the next few weeks, though hundreds of amendments tabled in the House of Lords, mostly to delay or weaken the legislation, remain to be considered.”

First of all – and I hate to be picky – there are not hundreds of amendments that remain to be considered. There are about thirty. Almost half of those are consequential on the Lords proposing a six month qualifying period for unfair dismissal. There is no sign that the Government is going to give way on any of them and they have already been rejected by the Commons. The idea that there are hundreds of outstanding amendments that may dealy or weaken the legislation is nonsense. 

But my main point is that the financial difficulties exception for local government is not as wide as the report suggests. It is not an ‘opt-out’. The financial difficulties exception allows an employer to avoid a finding of automatically unfair dismissal if it forces through a ‘restricted variation’ to a contract that was necessary in order to avoid an imminent threat to its ability to carry on the business as a going concern. Describing it as an opt-out does not do justice to the seriousness of the situation that the employer – and its workforce – must be facing.

When the Bill was published many pointed out that it was difficult to see how the exception could apply to local authorities because while they may become insolvent, they will not cease to operate as a going concern.

So the Government introduced an amendment that specifically defined the circumstances in which a council could rely on the financial difficulties exception. But under that amendment it is not enough for a council to merely be in ‘financial distress’ as the Guardian says. The financial difficulties faced by the Council must be so severe that the Secretary of State has concluded that the council is no longer fulfilling its obligations as a best value authority and has therefore issued directions under S.15(5) or (6) of the Local Government Act 1999. This is a relatively rare occurrence, though we have seen recent examples in Birmingham, Liverpool, Warrington, Northamptonshire, Woking and Slough (apologies to any councils I’ve missed!). Depending on the circumstances these directions can involve the appointment of Commissioners to oversee council spending but can also include measures related to organisational structure or workforce management.

The Employment Rights Bill says that it will not be automatically unfair to dismiss an employee for refusing to agree to a ‘restricted variation’ of contract if the Direction specifies that one of the reasons for it is that the council is ‘undergoing financial difficulties’ and contains provisions that relate to the council’s financial management or governance.

Not every direction will meet that requirement – but many will. Certainly the question of financial sustainability seems to be a key feature of most if not all of the directions that I have read. 

The key point however is that the exception will only apply once the Direction has been made. It cannot apply to variations that are necessary to avoid such a Direction. The Direction must be in force on the date of the dismissal (New s.104I(8)(a) ERA 96). 

So a council cannot say ‘well, we need to make this contractual change because if we don’t we will effectively be insolvent and the Secretary of State will send in Commissioners to control our spending’. They cannot make a contractual change to avoid financial disaster. The disaster has to be allowed to happen, the Secretary of State must intervene – and only then can the council look at changing terms and conditions to address its financial difficulties. 

That does not strike me as much of a ‘watering down’ of the provision.

I’ve been arguing all year that the ban on fire and rehire is going to have unintended consequences because measures that most people would see as perfectly sensible will be deemed to be automatically unfair. The extension of the financial difficulties exception to local authorities does not alleviate that problem – it illustrates it. 

Posted in Uncategorized | Tagged , , , , | Leave a comment

The Reshuffle and the Employment Rights Bill

Posted on September 9, 2025 by Darren Newman

The cabinet reshuffle on Friday may well have major implications for the Employment Rights Bill. Of course, Angela Rayner was a key advocate for the Bill – but her departure alone would not have made me think that there was anything afoot. When I saw, however, that the Minister for Employment Rights, Justin Madders, had also left the Government I was quite taken aback. If the Prime Minister was happy with the way the Bill was progressing why would he dismiss the minister most directly involved in shepherding it through Parliament just as it reached its final stages? Is this an indication that the Government is open to a fresh approach?

The Bill will pass

I’m afraid those hoping for an explicit Government U-turn are going to be disappointed. The Bill is still going to pass.

First of all, the Bill has nearly finished it’s passage through Parliament. The Commons are due to consider the Lords amendments on 15 September. We are well past the point when the Government can introduce new changes. The only question is whether the Lords amendments should be accepted or not. 

Most will be – after all, the majority of them were made by the Government. Significant technical changes that make my eyes glaze over were made to the provisions on guaranteed hours. There were also some significant policy changes – the ban on fire and rehire was also changed significantly as I explained here All of these changed will obviously be accepted by the Commons where the Government has a large majority. 

The Commons will, however, reject the amendments made by the Opposition parties in the Lords. These range from introducing a six-month qualifying period for unfair dismissal to a new clause specifying that children can be employed on heritage railways. Some of these changes directly contradict the Government’s manifesto commitments and others are not really intended to become part of the Bill. 

Opposition amendments don’t stand up

For example, one amendment inserts the words ‘if requested by an employee’ at the beginning of the provisions on the duty to offer guaranteed hours. The amendment gave the Lords the opportunity to debate what should trigger an offer from the employer but it obviously can’t remain the Bill. How should the request be made? When should it be made? Why does the request need to come from an ‘employee’ when the right applies to ‘workers’? Does the employee who makes the request have to be the same worker who qualifies for the offer? Does the employee have to be employed by the employer in question or can anyone who happens to be employed by someone make a general request to all employers?  The amendment does not answer any of these questions because it was not intended as a serious revision of the law, but a jumping off point for a debate. I suspect the Opposition were quite surprised when it was passed.

Another amendment seeks to widen the right to be accompanied at disciplinary and grievance hearings to include representatives of ‘professional bodies’ specified by Regulations. Again we can have a debate about who an employer would have to accept as a companion, but the amendment would allow the Government to designate commercial organisations that would then be able to charge workers to have one of their lawyers represent them at disciplinary and grievance hearings. It would be a recipe for disaster and on reflection I am sure that anyone can see that. 

And then we get the qualifying period for unfair dismissal. I would be quite happy to see this set at six months. In fact I think that should have been the policy from the start and if I had my way that change would already have been made. Instead, the Government’s plan is to keep the qualifying period at two years until at least 2027. Putting that aside however the amendment keeps the ‘initial period of employment’ provisions that are supposed to coincide with a probationary period and provides that it starts only after the first six months of continuous service has ended. It’s nonsense. And, by the way, the amendment does not prevent a Government going on to abolish the qualifying period altogether by Regulation  once the Bill is in force. 

These amendments are debating points – they are not serious and they are not going to remain in the Bill (although I am on the fence about heritage railways). The Commons will reject them on the 15 September and the Lords will not – if they have any sense of propriety – insist on them. I wouldn’t rule out them throwing the Bill back to the Commons once just to make sure the Bill can’t’t have Royal Assent before the Labour Party Conference, but the Bill will get passed and the Government will not accept Opposition amendments that run counter to its manifesto commitments.

Passing the Bill is the easy bit

Some of the Bill comes into force automatically, two months after Royal Assent. Those issues are mainly concerned with the effective repeal of the Trade Union Act 2016 and there is no going back on that commitment. But the bulk of the Bill has to be implemented measure by measure – often following detailed consultation and requiring complex Regulations. If the new Ministers in charge are less enthusiastic about the Bill than Angela Rayner and Justin Madders were, then it is in the implementation that the impact of that will be felt. 

The current roadmap for implementation envisages a raft of consultations being launched this autumn. The Government proposes to consult on reinstating the School Staff Negotiating Body and setting up a Fair Pay Agreement in Adult Social Care. We also expect consultations on electronic industrial action ballots, day one rights for unfair dismissal; ‘ending the exploitative use of zero hours contracts’; fire and rehire; bereavement leave and rights for pregnant workers.

To be honest, I was sceptical that the Government would manage to put so many detailed consultations out so quickly even when the Minister most committed to be Bill would be the one overseeing them. With a new minister for Employment Rights (identity tbc at the time of writing) it is easy to see this timetable slipping. I would be frankly astonished if, for example, electronic balloting was introduced in April 2026 as the current roadmap promises.

I also doubt that political decisions will be the same post re-shuffle. For example, when the Bill was going through the Commons I wrote about what Justin Madders had said concerning the threshold at which the duty to offer guaranteed hours would kick in. This is a crucial policy decision that will largely determine how big an impact the new right will have. If it only applied to workers guaranteed less two hours a week then it would be largely symbolic. If it applied to those who are guaranteed 24 hours or more a week then that would be a huge issue. This is a political decision and Justin Madders indicated that he favoured a threshold towards the higher end. That decision will now be made by his replacement. If I were lobbying for employers I would detect an opportunity here.  

There are many other policy decisions that will need to be made over the next two years as individual measures are either implemented or kicked into the long grass. Replacing all of the Ministers responsible for making those decisions must be an indication that the Government is at least open to suggestions. What is in the Bill itself cannot be altered – but when and how the Bill will be implemented was always going to be the key issue. Don’t expect any Ministerial announcements denouncing the Bill or explicitly abandoning any of its provisions. Instead expect to see a gradual slipping in the timetable and more openness to business concerns when it comes to the detail.

Posted in Uncategorized | Tagged | 4 Comments