Employment Rights Bill: What’s Changing?
An Amendment Paper on the Employment Rights Bill was published at the end of November. Key proposed changes include the following proposals from the Government:
- Extended time limits for tribunal claims: The addition of a new Schedule which will have the effect of extending the time limit for bringing all tribunal claims from 3 months to 6 months.
- More information on the ‘Initial Period of Employment’ (IPE): The draft Bill makes unfair dismissal a Day One right but leaves some wriggle room by allowing for different rules to apply during what is termed the ‘initial period of employment’ (IPE). There was nothing in the original draft Bill about how long the IPE might be, although the accompanying ‘Next Steps’ document indicated it might be 9 months. A provision is now included stating that the IPE will be not less than 3 months and not more than 9 months.
- Guaranteed hours: Various changes to the provisions relating to guaranteed hours which don’t appear to make any wholesale change to the complex way in which these provisions are currently structured.
- Shift cancellation payments: Changes to the rules on payments when shifts are cancelled, moved or curtailed at short notice, include giving the tribunal discretion on whether to make an award where an employer has failed to make a payment required in such circumstances, and further discretion as to what that payment should be, taking account of the ‘seriousness of the matter’.
- Menstrual health added to equality planning: Menstrual problems and disorders are set to become a defined aspect of “matters related to gender equality.” This means employers may need to include them in equality action plans under separate regulations.
- Trade union access clarified: Clarification that the right of trade unions to access workplaces will not extend to any workplace which is also a dwelling.
Additional changes have been proposed by MPs:
- No more gagging on harassment: A proposed clause would void any non-disclosure agreement (NDA) that tried to stop workers from reporting harassment, including sexual harassment.
- Banning substitution clauses: These clauses allow workers to send someone else to do their job. If this change passes, they’ll be off the table in employment, worker, or dependent contractor contracts.
It remains to be seen how many of these changes will ‘stick’ as the Bill continues its progress through the House of Commons. The provisions relating to extension of time limits are likely to be here to stay (given they occupy an entire Schedule and reflect one of the Government’s election pledges).
Government announces new rates for family leave pay and statutory sick pay from 6th April 2025
The statutory rates of pay applicable to the various types of family leave which can be taken, together with the amount payable as statutory sick pay, are updated on an annual basis. The new rates, which will apply from 6th April 2025, have now been published by the Government. The new rates are as follows:
| Old Rate | New Rate |
Statutory maternity pay | £184.03 per week | £187.18 per week |
Statutory paternity pay | £184.03 per week | £187.18 per week |
Statutory shared parental pay | £184.03 per week | £187.18 per week |
Statutory adoption pay | £184.03 per week | £187.18 per week |
Statutory parental bereavement pay | £184.03 per week | £187.18 per week |
Statutory sick pay | £116.75 per week | £118.75 per week |
These figures will be superseded by any higher figures which an employer might offer either on a discretionary basis or as part of a contractual obligation. The average gross weekly earnings required to qualify for the various forms of family leave pay will increase from £123.00 or more per week, to 125.00 or more per week from 6th April 2025. The figures stated are the maximum payable (under statute) per week. If an employee earns less per week than the rate stated, then they should receive the lower amount equating to their actual earnings.
Modern Slavery: Key employer obligations
Under the Modern Slavery Act 2015, UK businesses have specific obligations to help combat modern slavery. This legislation applies primarily to businesses with a turnover of £36 million or more annually. These larger companies are legally required to publish an annual statement detailing the steps they have taken to ensure that modern slavery and human trafficking are not present in their operations or supply chains.
The statement, often referred to as a Modern Slavery Statement, must be approved at the highest levels of the organisation (such as the board of directors) and must be made publicly available on the business’s website.
The Modern Slavery Act recommends that the following six areas are covered in any statement:
- Organisation structure and supply chains: Companies must outline their operations and supply chains, describing how they function and where potential vulnerabilities to modern slavery might exist.
- Policies in relation to slavery and human trafficking: The statement should highlight the internal policies in place to prevent and address modern slavery, such as supplier codes of conduct, ethical trading policies, and whistleblowing mechanisms.
- Due diligence processes: used to vet suppliers and job applicants.
- Risk assessment and management: Businesses need to assess where risks of modern slavery are highest, both in their direct operations and in their supply chains.
- Key performance indicators to measure effectiveness of steps being taken
- Training on modern slavery and trafficking: Employers are expected to describe the training provided to staff on modern slavery.
The House of Lords Modern Slavery Act 2015 Committee recently published a report which proposed the introduction of financial penalties for non-compliance with the requirement to publish a statement and a suggestion that the category of businesses obliged to produce a statement are widened.
Currently the Secretary of State can enforce the duty to prepare a slavery and human trafficking statement in civil proceedings by way of an injunction. If the organisation fails to comply with the injunction, it will be in contempt of a court order and will be liable to an unlimited fine.
Aside from the statutory sanctions, a failure to produce and publish a statement could lead to a damage in reputation and brand. A good example of the reputational impact of modern slavery issues can be found in the recent case of a branch of McDonald’s in Cambridgeshire, which was found to have employed 16 victims of modern slavery.
Comments about an individual’s accent can be harassment
A recent Employment Appeal Tribunal (EAT) case has highlighted that making comments about someone’s accent, such as saying it’s hard to understand, can sometimes be considered unlawful racial harassment.
In Carozzi v University of Hertfordshire, the employee (the Claimant) accused her employer (the Respondent) of several types of discrimination and harassment. Some of her claims focused on comments made about her strong Brazilian accent. Initially, the tribunal dismissed all her claims. However, the Claimant appealed, arguing that:
- Accent and Ethnic Origin: She believed the comments about her accent were connected to her ethnic origin (being Brazilian), even if those making the comments weren’t influenced by her ethnicity when they made the comments.
- Victimisation: She had claimed her employer refused to share a document (meeting notes) because they were worried she might use it to make a discrimination claim. Employees are protected from being treated less favourably because they have raised issues of potential discrimination. The tribunal had dismissed this claim on the basis that the employer would have withheld the document if they had been worried that the employee might make another legal claim (one which was not for discrimination) so there was no less favourable treatment. The Claimant argued that this was wrong.
The EAT agreed with the Claimant and allowed her appeal. Here’s why:
- Accent and race are linked
The EAT clarified that comments about someone’s accent can be ‘related to’ their ethnic origin – it doesn’t matter if the person making the comment wasn’t influenced by their ethnic origin in making the comments. - Refusing to share documents can be victimisation
If an employer refuses to share a document because they fear it might be used in a discrimination case, this could count as victimisation. The EAT said the tribunal was wrong to dismiss this claim, the real question was whether the refusal to provide the notes was influenced, at least partly, by concerns about a possible discrimination complaint.
What Does This Mean for HR?
- Train employees to be cautious and respectful about comments on accents—they can easily cross the line into harassment, especially if the accent is tied to a person’s race or nationality.
- Transparency is important. Withholding documents out of fear they might lead to legal claims could lead to victimisation complaints.
How to dismiss fairly when the working relationship breaks down
Employees who have worked for a company for over two years are protected by law against unfair dismissal. This means that if an employer wants to dismiss such an employee, they need to:
- Have a valid or ‘fair reason’ for the dismissal.
- Show that the dismissal was handled reasonably.
There are five fair reasons for dismissal, one of which is known as “some other substantial reason” (SOSR). SOSR is often used when the relationship between the employee and employer has broken down completely, making it impossible to work together.
In the recent case of Alexis v Westminster Drug Project, the employer restructured the organisation, and three roles were to be replaced by two new ones. The employees affected, including the Claimant, had to apply and interview for the new positions. The Claimant didn’t get the job. She had dyslexia and complained about the interview process, saying she should have received the questions 24 hours in advance.
After raising a grievance and appealing the outcome unsuccessfully, she began sending numerous emails to the decision-makers. This behaviour led the employer to call a meeting to discuss whether she could continue in her role. The employer concluded that the relationship had broken down beyond repair and dismissed her with notice for SOSR. The Claimant then brought an unfair dismissal claim.
The tribunal rejected her claim, and the Employment Appeal Tribunal (EAT) agreed. The EAT found that:
- Relationship breakdown justified dismissal
The employer had reasonable grounds to decide that trust and confidence had been lost, and the relationship had reached a point of no return. In such cases, dismissal is a reasonable step. - Length of service may not matter
The Claimant argued that her long service should have been considered, but the EAT explained that length of service only matters if it is relevant to the decision. Here, the dismissal was due to the breakdown of the relationship, so her service length wasn’t a factor. - No need to consider alternatives
Once the relationship was irreparably damaged, the employer didn’t need to explore alternative options to dismissal.
HR can take the following points from this case:
- If trust and confidence are completely lost in the employment relationship, dismissal may be justified under SOSR.
- Employers should document clear evidence of the breakdown and the steps they took to assess the situation.
- Length of service is not always a required consideration—only if it is relevant in some way to the dismissal decision.
- Unlike dismissals for capability or misconduct, employers don’t need to jump through additional steps or explore alternatives when they have clear evidence the relationship has broken down.
Government plans to extend ban on non-compliant employers hiring overseas workers
Employers who want to hire workers from outside the UK must generally have a sponsor licence. This includes hiring workers from the EU, Iceland, Liechtenstein, Norway, and Switzerland, who arrived in the UK after 31 December 2020. A sponsor licence ensures the employer can legally employ overseas workers.
What happens if employers break visa rules?
The Home Office can revoke a sponsor licence if an employer repeatedly breaks visa rules. This can cause serious problems for businesses that depend on overseas workers. If a licence is revoked:
- The employer cannot legally hire overseas workers anymore.
- Sponsored workers already employed will lose their visa. They usually have 60 days to find a new sponsor or leave the UK, unless they have less time left on their current visa.
Currently, there is no right to appeal a revoked licence. Employers must wait a “cooling-off” period of 12 months before they can reapply for a sponsor licence.
New proposed rules
The Government has proposed stricter rules to hold employers accountable and prevent worker exploitation:
- Longer cooling-off period
Employers whose licences are revoked will now have to wait two years instead of 12 months before they can reapply. - Stricter compliance with employment laws
Employers must comply with employment rules, such as paying the national minimum wage. Breaking these laws could lead to their sponsor licence being revoked. - Ban on charging workers for visa sponsorship costs
Employers will no longer be allowed to charge workers for the costs of their visa sponsorship, including certificates of sponsorship and sponsor licence fees. This rule aims to stop exploitation, particularly of care workers, who sometimes end up in debt to their employers.
These changes are a wake-up call for employers who rely heavily on overseas labour. Ensuring compliance is more important than ever to avoid significant business disruption and losing access to overseas labour.
And finally, AI applications such as ChatGPT have, over the last 12 months or so, become an important tool in improving business efficiency. However, a recent tribunal judgment indicates that it is not just employers who are taking advantage of AI. It was recently credited with encouraging a serial litigant in a disability discrimination claim against a prospective employer. In Mallon v West Midlands Growth Company, the Respondent failed in its attempt to get the Claimant’s disability discrimination case struck-out on the basis that the Claimant was a serial litigant. According to the Respondent, the Claimant would be “unrealistic in applying for roles for which he [had] no relevant experience”. Since 2019, the Claimant had applied for roughly 4,600 jobs and initiated over 60 legal claims.
The Claimant admitted he used an AI tool to analyse his email trails with prospective employers. He uploaded his correspondence to the technology, which, in the case against West Midlands Growth Company, allegedly revealed the company’s poor communication and that failure to accommodate his requests could amount to an Equality Act 2010breach.
Hopefully, this serial job applicant story is an exceptional case. However, as AI technology continues to develop and becomes more accessible, more people will use AI tools to analyse the behaviour of their employers or prospective employers.