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Potential employment law change after the general election

  • United Kingdom
  • Employment law

15-11-2019

With only four weeks to go before the election and no sign, as yet, of the parties publishing their manifestos, employers are waiting for clarification about potential changes to employment law.

The recent Party conferences, together with the Conservative Government’s Queen Speech in October, give an indication of the direction of travel (depending on the election outcome) which we outline below.

Conservative Party

The Conservative Party, in comparison with other parties, has so far had relatively little to say about future employment law policy. This may be because, were they to secure a majority in Parliament and to proceed with their Brexit plans, future policy will inevitably be influenced by EU conditions upon a future trade deal. Can we therefore expect “business as usual” under a future Conservative Government?

The current Government has made several statements to the effect that it will preserve workers’ rights established under EU law. Despite these verbal assurances, the recent changes to the Withdrawal Agreement with the EU, which move any such commitment from the Agreement to the accompanying Political Declaration, have been interpreted by some as a threat to EU rights. In reality, however, a Conservative Government may not have the opportunity or the appetite to make significant changes to such workers’ rights post-Brexit but, at most and as suggested in their Party conference, will consider reducing perceived “red tape” from EU regulations.

There are nonetheless several employment-related initiatives already in the pipeline, including:

  • greater transparency over terms of engagement through compulsory written statements for workers
  • tighter controls over the tax status for workers through the extension of the IR35 rules
  • improved written information for agency workers and the scrapping of pay between assignment contracts

Longer term proposals likely to be carried forward by a Conservative Government include:

  • a new target for the national living wage of two-thirds of median earnings (£10.50 on current forecasts) and reduce the age threshold to 21, both by 2024
  • curbing the use of confidentiality and non-disclosure agreements
  • greater onus upon employers to prevent harassment
  • a right to request fixed hours
  • wider access to workplace modifications for those with health issues
  • ethnicity pay gap reporting, building on the gender pay gap regulations
  • an “Australian style” points-based immigration system, post Brexit, ending free movement from Europe and with a focus on attracting skilled immigrants and filling vacancies in the UK

Unlike the Labour Party, there seems little appetite amongst the Conservative Party to change collective labour law. Even so, the Government’s lowering of the threshold required for a request to set up information and consultation arrangements from 10% to 2% of employees may boost workers’ say in some workplaces.

Labour Party

Recent speeches by the Labour leadership have underlined their ambition to introduce significant employment law change, building upon their 2017 election manifesto. It will be interesting to see how this translates into their manifesto commitments when published. In particular, their collective and trade union proposals, if implemented, could significantly change UK employee relations. These include proposals to:

  • introduce sectoral collective bargaining by establishing councils of worker and employer representatives that “negotiate collective agreements with minimum terms, conditions and standards for the whole of the sector and guarantee a legal minimum for every employer in the sector” including pay and working hours
  • repeal the 2016 Trade Union Act. The Act introduced new industrial action ballot thresholds, tightened the supervision of picketing, provided for longer advance notice of strikes and the re-balloting of ongoing disputes
  • introduce electronic and workplace ballots
  • give trade unions the right of entry to workplaces (to organise members and to meet and represent their members) and strengthen the protection of trade unions and their representatives

In terms of broader employment law, Labour announcements over the last two months include proposals to:

  • raise the national minimum wage for all over-16s to £10 per hour in 2020
  • create a single employment status for everyone except the genuinely self-employed
  • in large companies, a third of directors should be elected by workers and a tenth of shares be owned by those workers
  • set a target of closing the gender pay gap by 2030, lower the threshold for reporting to workplaces with 50 employees and require all employers with over 250 employees to obtain government certification on gender equality or “face further auditing and fines”
  • create a new Workers Protection Agency with extensive powers to enforce workplace rights, such as powers to fine organisations that fail to: report their gender pay gap; publish action plans to reduce pay gaps; or, take satisfactory measures to close the pay gap
  • give all workers the right to work flexibly (subject to the employer providing evidence that a job is not suitable for flexible working)
  • require large employers to introduce a menopause policy and to tackle sexual harassment
  • increase statutory maternity pay from nine to twelve months
  • reduce the working week to 32 hours over ten years. The aim would be, according to Labour, to achieve this as part of the roll out collective bargaining (as opposed to an outright ban), ending the 48 hour working time opt and setting up a Working Time Commission to recommend increases to statutory holiday entitlements
  • ban unpaid internships and zero-hours contracts
  • set a maximum pay ratio of 20:1 in the public sector
  • increase protection against unfair dismissal and redundancies, with a focus on rights for pregnant women
  • maintain a “managed migration” system. Until the manifesto is published, it remains unclear whether or not this means fewer controls on immigration, as some parts of the media have reported

Liberal Democrat Party

The Liberal Democrat’s stated “primary goal” is to stop Brexit, meaning that free movement rights would be preserved. Beyond that, it appears we can expect an increased focus on family friendly policies and lifelong learning, with proposals so far encompassing:

  • large companies being required to publish their parental leave policies; shared parental leave to become a day one right; an additional four weeks of use-it-or-lose-it paternity leave
  • 35 hours per week free childcare from when their baby turns nine months old to encourage parents to return to work
  • a £10,000 grant, payable in instalments over a 30 year period, for every adult in England which would be added to a "skills wallet" used to pay for approved courses; employers could contribute funds to the wallet
  • a 20 per cent higher minimum wage for zero-hour workers at times of normal demand to compensate for the uncertainty of fluctuating working hours
  • tax incentives to encourage businesses to employ ex-offenders

We will continue to update you as the election campaign unfolds.

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