Labour’s employment reforms won’t become law for two years as government seeks to reassure business
Major employment reforms promised by Labour will not become law for at least two years, as the government seeks compromise between unions and businesses on measures intended to strengthen workers rights without hindering economic growth.
The Employment Rights Bill, introduced into parliament on Thursday, includes 28 measures, many of which will be subject to extended consultation, while more than 30 other pledges have no clear timetable for delivery.
The major package of reforms includes granting workers protection from unfair dismissal from the first day of their employment, ending the existing two-year qualifying period.
The measure will be accompanied by a statutory probation period of up to nine months for new hires, during which staff can be dismissed under a “lighter touch” process.
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The consultation required means officials do not expect the measures to reach the statute book until autumn 2026 at the earliest.
Other measures in the bill include:
• The right to statutory sick pay from the first day of illness, ending the current three day waiting period, and removing the lower earnings limit
• Day-one rights to paid and unpaid paternity leave. Currently fathers have to be employed for 26 or 52 weeks respectively to receive the benefits, and there will be a new statutory right to bereavement leave
• The right to flexible working. Where employers say no they will have to demonstrate the decision is reasonable against eight criteria
• A ban on “exploitative zero hours contracts”. Workers on zero or short-hours contracts will have to be offered a contract based on the hours worked in a 12 week reference period, receive notice of shift patterns and entitlement to payment for short-notice cancellation
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Among the measures excluded from the Bill is the introduction of a single category of worker, a measure long-promised by Labour and seen by unions as crucial to ending exploitation and inequality in the gig economy.
Currently there are broadly three categories; employee, worker and self-employed, with many gig-economy providers such as food delivery and ride-hailing apps classifying workers as self-employed, denying them access to sick pay and other benefits.
The “right to switch off”, which would have prevented employers contacting staff outside working hours, has also been left out, and will instead be subject to an agreed code of conduct.
The bill and delayed timetable for other reforms has already been the subject of extended debate and consultation between the new government, unions and business groups wary of the additional cost arising from the reforms.
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Despite a programme and timetable that may disappoint some in the union movement, ministers believe it strikes the right balance between improving the lot of workers, and incentivising the economic growth on which its wider programme relies.
Deputy Prime Minister Angela Rayner said: “This government is delivering the biggest upgrade to rights at work for a generation, boosting pay and productivity with employment laws fit for a modern economy. We’re turning the page on an economy riven with insecurity, ravaged by dire productivity and blighted by low pay.”
Jonathan Reynolds, the business secretary, said: “The best employers know that employees are more productive when they are happy at work. That is why it’s vital to give employers the flexibility they need to grow whilst ending unscrupulous and unfair practices.”