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What the UK General Election 2024 could mean for employment law

woman-placing-ballot-box General Election 2024 employment law

As we approach the General Election on 4 July 2024, all the main political parties have laid out their manifestos. They each present vastly different proposals for employment law reform. This article outlines the key headline proposals from the five major parties in England and analyses their potential impact on your business and employment practices. 

 

Conservative Party

The Conservative Party manifesto is fairly quiet on employment law, with no radial reform to the current law in place. This may not surprise many given the party has governed for 14 years. In the main, the approach focuses on supporting businesses and workplace flexibility. The key proposals include: 

  • National Insurance cut: A reduction to 6% by April 2027, with a longer-term goal of abolishing it when ‘it is affordable to do so’.   
  • National Service model: Mandatory scheme for all 18-year-olds to ‘give young people the skills and opportunities they need to succeed’. 
  • Apprenticeship expansion: To create ‘100,000 high-quality apprenticeships – by curbing rip-off university degrees. 
  • Fit note process overhaul: Shifting the responsibility for issuing fit notes from GPs to specialist work and health professionals. 
  • A change to sex discrimination legislation: Clarifying that the protected characteristic of sex in the Equality Act means biological sex. 

Conservative Manifesto 2024 (conservatives.com) 

These manifesto pledges are unlikely to significantly alter your current employment practices. Although, you should prepare to update sickness policies in line with the new fit note process. 

 

Labour Party

The manifesto of the Labour Party is based on ‘Labour’s Plan to Make Work Pay’ which promises to deliver a new deal for working people. The Labour Party has placed much emphasis on workers’ rights, fairness and job security. The headlines are: 

  • Ban on zero hours contracts: Ensuring everyone has the right to a contract that reflects actual hours worked. 
  • End to ‘fire and rehire’: Prohibiting the practice where an employee is dismissed and then re-engaged on new terms and conditions. 
  • Basic day one rights: Including parental leave, sick pay entitlement, and protection against unfair dismissal. At present the right to not be unfairly dismissed in most cases requires 2 years continuous employment. 
  • Simplified employment status: Moving to a ‘simpler two-part framework for employment status’, replacing the current three-tier classification. 
  • Enhanced redundancy rights: To strengthen redundancy rights and protections by ensuring the right to redundancy consultation is determined by the number of people impacted across the business rather than in one workplace. 
  • Flexible working: The party pledge to ‘adapt and build on this baseline to ensure flexibility is a genuine default. 
  • Maternity discrimination: Making it unlawful to dismiss a person who is pregnant for six months after their return. 
  • Living wage: Adjusting the minimum wage to take into account the cost of living. There would also be a removal of the age bands to ensure every adult worker benefits. 
  • Trade Union empowerment: Labour will update trade union legislation, so it is ‘fit for a modern economy, removing unnecessary restrictions on trade union activity and ensuring industrial relations are based around good faith negotiation and bargaining. 
  • Menopause action plans: Requiring large employers with more than 250 employees to produce Menopause Action Plans.  
  • Extended tribunal time limits: Increasing the time limit to bring claims from three to six months. 

My plan for change – The Labour Party 

These dramatic changes will require you to review and possibly overhaul your employment practices, especially concerning probation periods, zero-hours contracts, and redundancy procedures. We would suggest that you consider your current probationary period documentation and look to adopt a new and more extensive probationary period policy.  Any new policy could enhance your ability to manage situations where employees do not perform as expected in the initial stages of their employment, compared to what was anticipated during the interview process. 

 

Liberal Democrats 

The Liberal Democrats’ manifesto, ‘For a Fair Deal’ aims to balance workers’ rights with business needs. Key proposals include: 

  • Dependent contractor status: A new employment status that would sit in between that of an employee and self-employed person with rights to minimum wage, sick pay, and holiday entitlement. There will also be a shift to the burden of proof in employment tribunals regarding employment status from individual to employer.  
  • Higher minimum wage for zero-hour workers: A 20% higher wage during normal demand periods. 
  • Parental leave expansion: Making it a day-one right, extending to adoptive parents, kinship carers, and self-employed parents. Paternity leave pay would be increased to 90% of earnings with a cap for higher earners. 
  • Increased statutory pay: Doubling statutory maternity pay and shared parental leave to £350 per week. 
  • Caring as a protected characteristic: Make caring a protected characteristic under the Equality Act 2010 and requiring employers to make reasonable adjustments to enable employees with caring responsibility to provide care. 
  • Statutory sick pay reform: Aligning it with the National Minimum Wage and extending it to lower earners earning less than £123 per week. 

For a Fair Deal – Liberal Democrats Manifesto 2024 – Liberal Democrats (libdems.org.uk) 

Should the Liberal Democrats get into power, you’ll need to review your parental leave and sickness policies. If you operate in an industry where zero-hour working is common, adjust pay scales to comply with these changes. 

 

Green Party 

The Green Party focuses on fairer employment and sustainability. The headlines are: 

  • Charter of workers’ rights: Repealing current trade union legislation and ensuring all employers recognize trade unions. 
  • Increased minimum wage: Raising it to £15 an hour with no age restrictions, offset by reduced National Insurance for small businesses. 
  • Equal employment rights: Extending rights to gig economy workers and those on zero-hours contracts. 
  • Four-ray workweek: Proposing a shorter workweek. There is no detail as to how this would work or whether this would apply to all workers. 

Our 2024 General Election Manifesto – Green Party 

These plans are likely to have a greater impact on businesses using freelancers and zero-hour employees and would require significant adjustments to wage structures. We also recommend that you review your current trade union practices should The Green Party win. 

 

Reform UK

The manifesto of the Reform UK Party labelled ‘Our Contract with You’ is low key with respect to reform to employment law. The headlines are: 

  • Abolish IR35 rules: Simplifying tax regulations for contractors. 
  • Higher income tax starting point: Raising it to £20,000 per year. 
  • Benefit reforms: All job seekers and those fit to work will be mandated to find employment within 4 months or accept a job after 2 offers. Otherwise, benefits will be withdrawn. 
  • Scrapping EU regulations: Repealing over 6,700 retained EU laws including many employment laws still based on EU regulations. 
  • Replacing the Equality Act: Reform UK will ‘scrap Diversity, Equality and Inclusion (DE&I) rules that have lowered standards and reduced economic productivity’. 

Reform_UK_Our_Contract_with_You.pdf (nationbuilder.com) 

Given that Reform UK are fairly silent on employment law reform, it is difficult to predict the impact a Reform UK victory would have. We do not know what will replace the repealed EU derived employment law or the Equality Act, so it is hard to make any predictions at this stage. Certain industries may profit more than others with regards to the benefit reforms (for example the hospitality industry) as it is likely those moving back into work will look for flexible and/or fixed hour work. 

 

Conclusion

With the current polling showing that we will almost certainly have a new Labour Government, significant employment law reforms are on the horizon. These changes promise an interesting and challenging employment landscape. You should stay informed and prepare to adapt to these potential changes.  

For expert advice and assistance in navigating these upcoming changes, contact Alex May, our employment law specialist.

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