The Employment Rights Bill: Government introduces significant amendments

UPDATE: The government has now accepted the below updates, as outline in this article.

The Government has tabled a number of significant amendments to the Employment Rights Bill (the Bill).

The amendments to the Bill stem from multiple consultations covering zero-hours contracts, agency workers, collective redundancy, trade unions, and statutory sick pay.

Key amendments to the Bill are set out below.

Guaranteed hours for agency workers

The Government has confirmed that it is tabling amendments to the Bill to set out the framework for agency workers regarding zero-hours contract. This is one of the most notable amendments, which will implement a requirement for agency workers to be offered guaranteed hours based on a reference period (expected to be 12 weeks). The end user of the worker’s services will typically bear this responsibility, although other entities (including agencies) may also be accountable in certain cases.

Employers and agencies will also need to provide reasonable notice for shift changes, cancellations, and adjustments.

Agencies and hirers will remain free to negotiate terms which may allow these costs to be recouped from the hirer where the hirer is responsible for the change.

Stronger collective consultation protections/fire and rehire

An amendment to the Bill proposes doubling the maximum protective award for failing to collectively consult during redundancies from 90 to 180 days.

Additionally, the Government intends to consult further on strengthening the collective redundancy framework and on updating the Code of Practice on ‘fire and rehire’ practices to provide stronger protections for employees who refuse contract variations.

The Government has decided against making interim relief available to employees who bring claims for the protective awards or who make an unfair dismissal claim in a ‘fire and rehire’ scenario.

Changes to trade union and industrial relations rules

Employers should also prepare for changes in trade union regulations, including:

• Strengthened protections against unfair practices during union recognition.
• Simplification of industrial action ballot requirements.
• Extension of the validity of a union’s industrial action mandate from six to 12 months.
• Providing for digital access rights to the workplace for trade union representatives.

Statutory Sick Pay (SSP) reforms

All employees will be eligible for SSP under the Bill, regardless of earnings, but lower earners may receive less than the standard rate. The Government has now introduced an amendment that workers will receive either 80% of their average weekly earnings or the current SSP rate, whichever is lower.

Regulating umbrella companies

A consultation on ‘Tackling non-compliance in the umbrella company market’ ran from June to August 2023 but no follow-up action was taken. The Government has tabled an amendment to allow umbrella companies to be regulated for the purposes of employment rights. The Government plans to introduce specific measures to align the rights of workers employed through umbrella companies with those of directly employed staff.

What this means for employers

The amendments will be considered at the House of Commons report stage, which is scheduled to take place next week. If the amendments are incorporated into the Bill, details of how the measures will work in practice will be implemented via secondary legislation.

Employers should stay informed as the Bill progresses through Parliament and, in due course, proactively update their policies and procedures to align with these upcoming changes.