As autumn gives way to the chill of winter, we find ourselves in warmer conversations about a topic that's heating up the employment landscape – the Employment Rights Bill. Last week, we hosted an engaging webinar that attracted a lot of interest from our clients, illuminating the many facets of this monumental piece of legislation.
While the Employment Rights Bill could easily fill several hours of discussion, on the latest episode of The Employment Law Podcast, John and Alan hone in on two pivotal consultations. Let’s dive in.
Digging deeper into the consultation process
In our webinar, we zeroed in on two key consultation papers that are critical for understanding the upcoming changes. The first centres around collective redundancy and the contentious practice known as fire and rehire. The second consultation is all about the implications of zero-hour contracts, especially as they relate to agency workers.
There’s a wave of change on the horizon, with the government aiming to tighten the reins on zero-hour contracts rather than imposing an outright ban. Part of this discussion involves whether these new regulations should apply to agency workers too—a decision that remains up in the air.
What is collective consultation?
So, what does collective consultation actually entail? It’s a crucial aspect, especially when companies are forced to make cuts.
If an employer plans to lay off 20 or more employees within a 90-day window, they must embark on a collective consultation process with employee representatives or trade unions. This engagement must last a minimum of 30 days before any dismissals can take place. And if they’re looking to make over 99 redundancies, that period stretches to at least 45 days.
Currently, failure to comply with these rules means employers could face hefty penalties, capped at 90 days’ pay per affected employee.
The proposals ahead
Now, here’s where it gets really interesting. The ongoing consultation is toying with the idea of doubling the maximum penalty from 90 to 180 days’ pay! To add more fuel to the fire, there’s also a proposal to eliminate the cap altogether, allowing tribunal judges to determine compensation based on the situation at hand.
The prospect of this kind of punitive measure raises pressing questions: How will businesses adapt? What effects will this have on their operations and workforce morale?
The balancing act
We explored this topic further during our webinar, and John made a pivotal observation—the government seems to be facing a tough dilemma: how to balance safeguarding worker rights without stifling business growth. With chatter about redundancies due to budget cuts, employers are caught between societal expectations and fiscal realities.
The potential for doubling protective awards or completely removing caps could feel like an added weight on many businesses, particularly the smaller ones that are already grappling with their own financial challenges.
Eyes on the future
With the consultation period wrapping up in a couple of weeks, now is the time for businesses to stay attuned to these developments. The Employment Rights Bill is more than just a set of regulations; it's a transformative legislation that could change the entire workforce landscape.
As we navigate through these significant changes, it’s essential for both employers and employees to engage in ongoing dialogue and stay informed. The implications of the Employment Rights Bill are profound, and how we respond will shape the future of work in the UK.
For further information on all the consultations and how to have your say, have a look at our blog post here Employment Rights Bill - Government consultations
In summary, the Employment Rights Bill is positioned to usher in substantial shifts in how we understand employee rights. The discussions are just beginning, and we’re excited to keep our audience updated on what lies ahead. Stay tuned for more insights, and don’t forget to sign up to our mailing list.