In my last post I looked at the new measures Labour is proposing in the field of trade union law. In this post I am going to look at individual employment rights, with proposals on discrimination and family-based rights coming next.

It is the proposals on individual rights that have attracted the most press scrutiny – and frankly it is the area where I think civil servants will have their work cut out for them to come up with coherent legislation that will achieve the policy goals that Labour is setting out. So in this area it is important to look not just at what Labour says it is going to do, but also think about what they may actually end up doing given the difficulties that some of their proposals might encounter. 

I’m going to take their proposals in the order they are given in their latest policy document “Labour’s plans to make work pay”.

Zero hours contracts

So this is a tricky one. In a recent post I suggested that Labour’s policy was shifting on this issue and that does seem to be confirmed by the new document. Here is what Labour says it policy now is:

Labour will end ‘one sided’ flexibility and ensure all jobs provide a baseline level of security and predictability, banning exploitative zero hours contracts and ensuring everyone has the right to have a contract that reflects the number of hours they regularly work, based on a twelve-week reference period

There is a lot to unpack there. But note the work that the word ‘exploitative’ is doing in that paragraph. You could, if you wanted to, read that to mean that zero hours contracts are exploitative and so Labour will ban them. But I think in context what is really meant is that Labour will seek to ban those zero hours contracts that are exploitative. Non exploitative zero hours contracts will remain lawful. 

How do we tell the difference between exploitative and non-exploitative zero hours contracts? Perhaps the clue is in the reference to ‘one sided’ flexibility. That refers to a situation where the employer does not guarantee that any hours will be provided but the worker is obliged to be available for any work that is offered. That situation would strike most people as unfair. Back in 2016 I wrote about the “availability provision” that was introduced in New Zealand. Perhaps Labour is thinking about introducing something similar here?

The idea of basing a worker’s guaranteed hours on their working pattern over a twelve week reference period strikes me as fraught with difficulty. Will that be a rolling requirement? Will employers have to keep adjusting contracts for employees to reflect their most recent working patterns? The document talks about having the ‘right’ to such a contract. Does that mean it will be based on some sort of right to request – perhaps using the right to request predictable hours created by the Workers (Predictable Terms and Conditions) Act 2023? Presumably there will be exceptions where there are good reasons why the work done in the previous 12 weeks will no longer be available? And how do you prevent employers from taking care to ensure that workers are not given regular hours in order to avoid having to formalise that working pattern in a contract? Could the new right just create an incentive to keep a worker’s hours as unpredictable as possible?

I don’t expect all of these questions to be answered in a general election campaign. The new document commits a Labour Government to a full process of consultation on the details and implementation of its proposals. Here is just one area where there will be a lot of work to do in coming up with workable – and meaningful – legislation.

Fire and rehire

Here is another area where it is easy to set out a policy, but much harder to frame workable legislation that achieves it. Here is Labour’s position:

Labour will end the scourges of ‘fire and rehire’ and ‘fire and replace’ that leave working people at the mercy of bullying threats. We will reform the law to provide effective remedies against abuse and replace the inadequate statutory code brought in by the Government, with a strengthened code of practice. Ending fire and rehire means workers can be safe in the knowledge that terms and conditions negotiated in good faith can’t be ripped up under threat of dismissal.

Hand on heart, I’m not sure I understand what is being proposed here. The Code of Practice being referred to (which will come into force during the election campaign) is indeed pretty tame. A stronger code stressing that dismissal for refusing to agree new terms and conditions would only be fair when the business is at genuine risk if the changes are not made and all other alternatives have been explored would be one way of shifting the dial and making it harder for employers to justify going down that route. Some time ago Alan Bogg of University of Bristol wrote about how a policy aimed at ending fire and rehire could be translated into legislation. It’s a really good explanation of the legal options available.

My problem with the proposal is that unless you also make it harder to make employees redundant, I don’t see how you can ban “fire and rehire” without creating an incentive for employers to go down the redundancy route. The real problem here is that the ‘range of reasonable responses’ test makes it difficult for Tribunals to rule that business decisions made by employers are unreasonable with the result that unfair dismissal has effectively become a law about how an employee is dismissed rather than why (discuss). Without fundamentally changing the way in which Tribunals decide whether or not all dismissals are fair or unfair I think it is difficult to come up with a coherent set of proposals focussing purely on fire and rehire. Obviously this is something we are going to come back to (if the polls are right). 

Day one rights

This has been a theme of Labour’s employment law policy for some time. Here is what they say: 

Our New Deal will include basic individual rights for day one for all workers, ending the current arbitrary system that leaves workers waiting up to two years to access basic rights of protection against unfair dismissal, parental leave and sick pay.

That is a very badly written paragraph which on a first reading makes it sound like Labour aims to protect workers against sick pay. What it means, however, is that the qualifying period for unfair dismissal and parental leave will be abolished. There isn’t a qualifying period for Statutory Sick Pay but Labour says elsewhere that they will remove the three day ‘waiting period’ before SSP is payable. 

There is currently a one year qualifying period for parental leave. It is quite a complex right giving parents a right to take up to 18 weeks’ leave – at the rate of no more than four weeks’ a year – for each child over the course of their childhood. But since the leave is unpaid, there is relatively little take up. I doubt many people will get excited about the removal of the qualifying period. 

As for unfair dismissal however, the abolition of the qualifying period will be a huge deal. I wrote about Labour’s proposal in September last year and took the view that eventually Labour would settle on a six-month qualifying period. I don’t think that is still an option for them – they are clearly committed to scrapping the qualifying period altogether. 

The abolition of the qualifying period for unfair dismissal can be done quickly with just a statutory instrument. But Labour does seem to want to add provisions into the Act around probationary periods. They say that they “will ensure” that employers can operate fair and transparent probationary periods which suggests that they won’t simply be leaving it to Tribunals to work out when it is fair to dismiss an employee for failing to pass probation. Exactly how those provisions are drafted and the extent to which the employer will have to justify a decision not to confirm an employee in post will be one of the key issues that employers will want to be consulted on by a new Labour Government. 

Single status of worker

Labour says that it will “move towards” a single status of worker and “transition towards a simpler two-part framework” that distinguishes between those in employment and those who are genuinely self-employed. This would be a huge structural change to the way in which employment law works and there is a clear suggestion here that Labour is in no hurry to move this forward. I think it ultimately makes sense to have a law under which everyone who is ’employed’ has the same rights. But that would make the boundary between those who are employed and those who are not particularly important. If everyone who currently counts as a ‘worker’ had the right to claim unfair dismissal and redundancy, would that affect how Tribunal’s view arrangements that were finely balanced? It would also seem very odd if workers who now qualified for full employment rights continued to be taxed as self employed. On balance I doubt this will form part of Labour’s first big bill on employment rights – but it is clearly an issue that we will return to at some point. Let’s just park this idea for now. 

Overview

While Labour’s proposals on trade unions and industrial relations – though controversial – seem largely straightforward to me, their policies on individual employment rights will need a lot of work before they can reach the statute book. “This new document “Labour’s Plan to Make Work Pay” emphasises their commitment to engaging with all stakeholders in consultation before finalising their proposals, and this will take time. I suspect that what we might see is a Bill dealing with trade union issues brought forward quite quickly in the first session of Parliament while other issues are deferred to later. There is surely too much being proposed here for the Business Department (whatever it is called under a Labour Government) to get it all through in one go. If Labour is elected I think we will be looking at employment law changes spread out across their first term.

We still aren’t done. In my next post I’ll look at what labour is proposing in relation to discrimination law and family-related rights.