November 2024

Employment Rights Bill: a summary of the key provisions

The Employment Rights Bill was published on 10 October 2024, ahead of the government’s self-imposed 100-day deadline. Across its 158 pages, it covers wide-ranging areas of employment relations. Some changes are dramatic, others less so. We have set out below our pick of the key provisions:

All employees will have the right to claim ordinary unfair dismissal from day one of employment. It is proposed that different rules will apply for conduct and capability dismissals during an initial period of employment (currently suggested to be the first nine months). Lower compensation may also be applicable in this period.
Statutory Sick Pay (SSP) will be payable from day one of any absence and all employees will be eligible, regardless of their earnings. The government is consulting on setting SSP for low earners as a percentage of actual earnings where their actual earnings are lower than the SSP flat rate (currently £116.75).
Employees working under zero hours or minimum hours arrangements will be entitled to receive an offer of guaranteed hours based on the hours that they usually work. They will also be entitled to reasonable notice of shifts and to payment for shifts cancelled or curtailed at short notice.
Employees will be eligible for parental leave (18 weeks unpaid leave per child) and paternity leave (up to 2 weeks of leave following the arrival of a child) from the first day of employment.
It will become automatically unfair to dismiss any employee where the reason for that dismissal is because they have refused to accept less favourable terms of employment, or because the employer wants to replace them with someone on less favourable terms. There will be a limited exception where the business is in significant financial difficulties and the employer couldn’t reasonably avoid the variation.
Employers will be liable for acts of harassment committed by third parties (for example customers, visitors or suppliers) unless they took all reasonable steps to prevent it.
The new pro-active duty to prevent sexual harassment will be expanded to make it clear that all reasonable steps need to be taken to prevent it (the current test omits the word ‘all’).
When considering whether the threshold for collective redundancy consultation has been reached (20 or more redundancies at any establishment in a 90-day period), an establishment is to be regarded as the whole business, not any individual site, branch or factory. This will bring more redundancy situations within the scope of redundancy consultation.
When considering requests for flexible working, the employer will need to state which of the 8 statutory grounds it relies upon to refuse but will also need to show that the refusal was ‘reasonable’.

It is important to note that very little is going to change overnight. Most of the provisions in the Bill will not come into force until 2026 at the earliest. It is also important to remember that not all the provisions will make it through the parliamentary and public consultation process unscathed. Some will disappear altogether. Others may look completely different by the time they hit the statute books. So, whilst it is a good idea to know what changes the Bill might signal, the first step should be to sit back, take stock, reflect and watch.

The duty to prevent sexual harassment in the workplace becomes law

On 26^th October 2024, the new pro-active duty to prevent sexual harassment in the workplace came into force. Employers are now under a legal duty to take reasonable steps to prevent sexual harassment in the workplace. The steps taken should not be limited to the risk of harassment by colleagues but should extend to third party harassment risk too.

There are two potential consequences if the duty is breached. Firstly, the Equality and Human Rights Commission can investigate non-compliance, issue unlawful act notices, require action plans to be prepared and, if the action plan is not followed, levy a potentially unlimited fine. Secondly, if an employer loses a sexual harassment claim in the tribunal, then the tribunal can uplift compensation by up to 25% if it finds that the employer failed to comply with the duty.

Employers need to look carefully at the policies and processes which they currently have in place and consider critically whether any further steps should be taken to prevent sexual harassment. To assist with this, the Equality and Human Rights Commission has published an 8-step guide to preventing sexual harassment at work which can be accessed here. The proposed steps comprise:

Developing an effective anti-harassment policy
Engaging with staff
Assessing risk and taking action to minimise risk
Putting in place clear reporting channels
Conducting training for all staff
Acting promptly if a complaint is made
Considering any specific harassment risk posed by third parties and taking steps to prevent this type of harassment
Monitoring the effectiveness of steps taken

Claimant who was called a “bald c**t” by his colleague succeeds in sex-related harassment claim

The nuts and bolts of a harassment claim under Equality Act 2010 involve each of the following:

Unwanted conduct;
related to a protected characteristic (either sex, race, age, disability, sexual orientation, religion or belief or gender reassignment) or conduct of a sexual nature;
which has the purpose or effect of violating the employee’s dignity or creating a hostile, degrading, humiliating or offensive environment.

Liability can only be avoided if the employer can show it took all reasonable steps to prevent harassment from occurring.

A recent Employment Appeal Tribunal reminds employers to take a broad-brush approach when considering whether conduct is related to a protected characteristic. Conduct which might not immediately appear to be related to a protected characteristic may still be so.

In Finn v British Bung Manufacturing Company, the Claimant worked in a male-dominated environment where harsh language was common. After a dispute with a colleague about machinery, the colleague insulted him by calling him a “bald c**t” and threatened violence. The Claimant was later dismissed and filed claims for unfair dismissal and sex-related harassment due to the comment about his baldness.

The Employment tribunal ruled in favour of the Claimant on the harassment claim, stating that the comment about his appearance (baldness) was personal unwanted conduct and intended to insult and create a hostile environment. The Tribunal found that baldness is more common in men, making the insult related to the Claimant’s sex.

The Respondent appealed, arguing that since baldness can affect both men and women, it should not be considered sex-related harassment. However, the Employment Appeal Tribunal dismissed the appeal, ruling that harassment does not have to be exclusive to one gender to be related to sex.

Managing personal data breaches in the workplace

Employers handle a vast amount of sensitive personal data, and under the General Data Protection Regulation (GDPR) and Data Protection Act 2018 (DPA), they are responsible for keeping it safe. This task often falls heavily on Human Resource teams, who must not only protect data but also respond effectively if a breach occurs.

What is a Personal Data Breach?

A personal data breach occurs when data is destroyed, lost, altered, or disclosed without proper authorisation. Breaches can range from simple human errors, such as sending an email to the wrong address, to more complex incidents like phishing attacks or hacking. Even verbal slips, like sharing confidential information overheard by someone else, count as breaches.

Why It Matters

Not all breaches have severe consequences, but those involving sensitive data can result in significant penalties. Organisations can face hefty fines—up to £17.5 million or 4% of global annual turnover. For example, Interserve, a construction company, was fined £4.4 million in 2022 for exposing the personal data of 113,000 employees.

Moreover, victims of breaches can pursue legal action. Manchester United, for instance, was sued after an email containing employees’ personal data was sent to casual staff, even though no fine was imposed by the ICO (Information Commissioner’s Office).

How to Manage a Breach

Act Quickly: Immediate action can help prevent a small breach from escalating. Fast responses also protect affected individuals, reducing risks like identity theft.
Get Organised: Have a breach response plan in place and assemble a team from relevant departments like IT and HR.
Contain the Breach: Identify the breach’s scope, recover data if possible, and protect sensitive information by actions such as changing passwords.
Assess the Impact: Evaluate the potential harm based on factors like the sensitivity of the data and who is affected.
Report the Breach: Notify the ICO within 72 hours if the breach poses a risk to individuals’ rights and freedoms.
Document the Incident: Regardless of whether it’s reported, keep records of the breach, its impact, and how it was handled.

Handling breaches swiftly and efficiently can limit legal, financial, and reputational damage while safeguarding affected individuals. Regular staff training and enhanced data protection measures are essential for minimising the risk of future breaches.

Bereavement leave: where are we now and where are we going?

Employees who suffer any form of bereavement currently have very limited rights to take time off work to deal with it. Much currently falls to the goodwill and understanding of employers. Employees are often forced into taking time off sick or on holiday to deal with their loss.

The legal landscape is (slowly) changing. Since April 2020, employees have had a right to parental bereavement leave. This is a right of each parent to two weeks off work at any point in the 56 weeks following the death of a child, if they die under the age of 18 or a child who is stillborn after 24 weeks’ pregnancy.

Employees have this right from the day they start their job. Unless the employer offers more generous terms, the time off is paid at the same weekly rate as statutory maternity pay. If more than one child dies, the employee is entitled to two weeks’ statutory parental bereavement leave for each child.

This law covers employees who experience the loss of a child but there remains no legal provisions in place for employees suffering wider bereavement. The recently published Employment Rights Bill aims to change this. The Bill introduces a free-standing right to bereavement leave of at least one week (and pay for that week at the same rate as statutory maternity pay). Exactly which ‘loved ones’ will be covered will be set out in regulations. The existing provision for parental bereavement leave is unchanged and will sit alongside and in addition to this new right.

Whilst most of the Bill’s provisions are unlikely to take effect until 2026, the introduction of bereavement leave is likely to happen sooner rather than later. The government’s Next Steps policy paper states that this change will come in ‘immediately’. Given the time it will take for the Bill to make its way through Parliament, it’s likely to be Spring 2025 at the earliest before the law changes.

Handling disciplinary hearings where the employee goes off sick

The Acas Code of Practice on disciplinary and grievance procedures says disciplinary processes should proceed ‘without delay’ – but what can employers do if delay is caused by an employee going off sick? The sickness may be unrelated to the disciplinary process. However, it can be a tactical deployment to ‘buy time’. It should also be borne in mind that employees may genuinely become unwell owing to the stress and anxiety caused by the process itself. Recent research by Worknest found that the leading cause of a protracted disciplinary process was an employee taking sick leave due to stress and anxiety, with almost a quarter (23%) of employers questioned citing this as the most common cause of delays.

In these sorts of cases, employers have the unenviable job of balancing a requirement to proceed without ‘delay’ with the fact that, as the Employment Appeal Tribunal emphasised in William Hicks & Partners v Nadal, it will only be reasonable for a disciplinary hearing to go ahead in an employee’s absence in exceptional cases. If a disciplinary hearing takes place resulting in dismissal, and the employee was not in attendance, the employer could face claims for unfair dismissal and, if the employee is disabled, disability discrimination.

It is a delicate balancing act, but employers should be aware that the disciplinary process does not have to be indefinitely paused in cases of sickness absence. They should let their employees know this. The matter might be ‘on pause’ but it is not going away.

Here are some practical tips to bear in mind if employee sickness is delaying a disciplinary process:

Consider making a referral to occupational health or obtaining other medical advice to confirm whether the employee is fit to attend a meeting. In some cases, an employee may not be fit to work in their specific role but may be fit enough to attend a disciplinary meeting. A doctor may also advise that it would help the employee not to delay proceedings.
If the business has a discretionary sick pay policy – consider whether payment of SSP only (rather than full pay) might encourage the employee’s sickness to abate more quickly. Be careful to make sure that the exercise of discretion is not vulnerable to a complaint of discrimination – but if the policy is genuinely discretionary, then this tactic should be given serious consideration. You might want to incorporate the position into your disciplinary policy so the position is clear: employees facing disciplinary action will receive SSP only during any period of sickness absence occurring during the investigation or disciplinary process.
Be considerate of the employee’s welfare and consider any potential adjustments that could be made to get the process moving. Off-site meetings, home visits, a wider choice of companions, the use of written representations or video conferencing should all be on the table. If you can, ask a medical professional for guidance on adjustments. This will give objectivity to your actions.

Government launches consultation on appropriate level of Statutory Sick Pay (SPP) for low earners

SSP is the payment made to employees when they are absent from work due to sickness. Currently, SSP is not paid during the first 3 days of any absence. These are known as ‘waiting days’. If an absence continues after the ‘waiting days’, then SSP is generally paid to employees at a flat rate (currently £116.75 per week) for up to 28 weeks of absence. There is an exception where an employee earns less than the ‘lower earnings limit’ (currently £123 per week). Employees earning less than the lower earnings limit do not receive any SSP payments at all during sickness absence.

All this is due to change. The government proposes to pay SSP from the first day of any absence and to remove the lower earnings limit requirement. There is obviously a risk of abuse if employees who earn less than the current flat rate for SSP when they are actually at work are entitled to a higher amount (the SSP flat rate) when they are off sick. To get around this, for those with weekly earnings lower than the flat rate for SSP (currently £116.75 per week), the Bill proposes to set SSP payments as a ‘prescribed percentage of the employee’s normal weekly earnings’.

The government has launched a consultation seeking views on what that percentage replacement rate should be. The consultation paper outlines some illustrative examples that set out the broad costs for employers and potential impacts on low earners of different percentage rates. The examples range from 60% of earnings, which is the lowest rate that the government’s internal modelling suggests would not leave employees worse off, to 80% of earnings, as proposed in the 2019 Health is Everyone’s Business consultation.

Any change is unlikely to come into effect until Spring 2025 at the earliest.

Practical Perspectives