Employment Rights Bill: Update following first Parliamentary Committee review

Key changes have been made to the Bill that indicate Labour plan to enact some key election pledges

Our October article Employment Rights Bill – what can employers expect? covered some headline features of the Bill following its introduction to Parliament. As outlined in the article the Bill was missing some key proposals Labour made as part of the 2024 election. 

Proposed amendments to the Bill were submitted on 27 and 28 November 2024 for consideration at the Committee Stage of the House of Commons. The Committee completed its review on 16 January 2025. The majority of the amendments were proposed by the government and all of the government amendments were approved. The latest version of the Bill incorporating the recent changes made by amendment was published on 27 January 2025.

This means the following amendments are progressing to the next stage of scrutiny.

Employment Tribunal claim periods

The government proposed an amendment to increase the time claimants have to bring all types of employment tribunal claims from three months to six months. This had been promised as part of the Labour manifesto in the 2024 election, but was missing entirely when the Bill was first introduced to Parliament.

Guaranteed Hours for Zero Hours and Low Hours Workers

Significant amends have been made  to the clause that introduces new rights for zero hours and low hours workers. The amends include new requirements for employers to:

• Provide specified information about guaranteed hours during an "initial information period" of two weeks, starting from the worker's first day of employment or the date it is reasonable to consider they could become a qualifying worker for guaranteed hours.

• Continue to provide access to this information if the worker remains employed and could potentially become a qualifying worker in any reference period.

• Notify workers if an exception to the duty to make a guaranteed hours offer applies or if a guaranteed hours offer is treated as withdrawn.

These amendments also allow workers to bring tribunal claims if these new duties are breached.

The reference period for determining whether a worker is a qualifying worker for guaranteed hours is not set out in the Bill, and will be confirmed by regulations at a later date.

Trade Union Access to Workplaces

Amendments to the Bill require trade unions to have a certificate of independence to benefit from workplace access provisions. The definition of "workplace" has been clarified to exclude any part of a workplace used as a dwelling.

Initial Period of Employment

The Bill established that unfair dismissal would become a day one right, though aspects of what amounted to a ‘fair’ dismissal under section 98(4) were proposed to be altered for an initial period of employment to give employers more flexibility to dismiss fairly, for example, during a probationary period.

The initial period of employment will be determined at a later date in regulations.

A government amendment allows the Secretary of State to specify a cap on compensatory awards for employees unfairly dismissed during the initial period of employment.

Next Steps and Comment

The Bill will now move on to the Report Stage in the House of Commons where further amendments may be considered. At this time, no dates have been set for those stages.

The manifesto pledges to increase the time for bringing Employment Tribunal claims from three months to six, as well as progression of day one unfair dismissal rights and more complex obligations on employers in areas such as agency workers and zero hours workers does suggest that Labour proposes to fulfil those pledges and move forward with plans to significantly strengthen employment rights.

This may lead to an increase  in claims brought to Tribunal, though commentary from groups like ACAS suggests they believe extending the time periods for bringing claims may in fact help settle matters that would otherwise result in a claim. If there is an increase in claims, then that is likely to stretch Employment Tribunal resources even further, resulting in longer waiting times for hearings.

The Bill promises to make some significant changes to employment law and whilst it is not certain these changes will all be enacted as they currently stand, it is worth employers keeping up to date with developments to help them plan for the future.