Labour’s proposed employment reforms: what schools should know

In anticipation of the 2024 general election, the Labour Party has set out in its green paper ‘a New Deal for Working People’ its proposed changes to employment law and employee rights.

In this article, we set out some of the key aspects of the green paper that schools should be aware of.

What would a Labour government mean for future employment law?

If elected, the Labour party pledge to:

Create a single worker status

Employment status in the UK is complex and currently has a three-tier approach. Individuals are either an employee, worker or self-employed contractor – with employees enjoying the most employment rights and protections, and self-employed contractors having the least.

One of Labour’s proposals is to create a singular ‘worker’ category for all staff, except those who are genuinely self-employed. This is to remove any ambiguity around employment status and create equality by providing all those in the single worker category the same basic rights and protections.

These basic rights are not defined, but unfair dismissal, increased statutory sick pay and parental leave are given as examples. The green paper noted that this would avoid those who currently fall within the ‘worker’ category being “exploited by unscrupulous employers.”

Although we await further details the end result is likely to be more individuals entitled to a wider range of employment rights. This would represent a significant change for schools who frequently use casual workers – such as visiting music teachers or exam invigilators where, currently, the rights of those workers are limited to paid holiday, the national minimum or living wage, and to be protected under anti-discrimination legislation.

This change could mean all workers other than the genuinely self-employed being entitled to sick pay, parental leave and unfair dismissal protections.

Give all workers ‘day one’ basic employment rights

In addition, Labour pledge to remove the qualifying periods for these basic rights so that workers – in the wider sense set out above – will benefit from their protection from day one of employment, subject to certain exceptions regarding a probationary period. This includes unfair dismissal protection which, at present, is only afforded to employees after two years’ service.

Zero-hours contracts have been a contentious subject due to their misuse by some employers. To ensure all jobs have a baseline level of security and predictability, Labour are proposing to ban such contracts and, in doing so, bring an end to the “one-sided flexibility” they believe they create.

They also promise to introduce a right for workers to request, after 12 weeks, a contract which reflects actual hours worked.

This pledge reflects changes that are already due to come into force under the Workers (Predictable Terms and Conditions) Act 2023 – which aims to achieve predictability for those on atypical contracts, but Labour’s proposals go further by potentially banning the use of zero-hours contracts altogether.

End ‘fire and rehire’ practices

Labour propose to put an end to employers being able to change terms and conditions of employment by dismissing and re-engaging staff – a practice also known as ‘fire and rehire’. This is to be achieved by enhancing information and consultation obligations and amending legislation around unfair dismissal.

This is an area of reform currently being considered by the Conservative government with the proposal to introduce a new Statutory Code of Practice and a potential compensation uplift of 25% for breach of the Code. Labour’s proposals go even further than this. Whilst it may prove difficult for Labour to implement an outright ban on ‘fire and rehire’, such a ban would impact an employer’s ability to make necessary contractual changes to maintain competitiveness.

Any change in this area will be of particular interest to those independent schools who are currently, or considering, undergoing consultation with teaching staff over a change in their contractual pension provision as a result of rising TPS costs.

Strengthen trade union rights

There is a significant focus on trade unions within the green paper, including the proposal to introduce a regulated legal framework that will give trade unions access to workplaces as well as enabling them to meet, represent and recruit members. Labour has also expressed their commitment to “remove unnecessary restrictions on trade union activity”, including the Trade Union Act 2016. The stated aim is to empower people to work through trade unions by giving unions the right to operate effectively in the workplace.

In addition, Labour wish to make changes to the trade union recognition process and have made the following proposals:

• Using secure electronic workplace ballots
• Simplifying the law around recognition by lowering the threshold and considering whether unions should automatically be entitled to statutory recognition where 50% or more workers are members
• Implementing a duty on employers to inform all new employees of their right to join a union and to inform all staff of this on a regular basis.

Enhance family friendly rights

The green paper promises to improve the position for working families by:

• Extending maternity and paternity leave – the position on adoption leave is unclear
• Introducing a new bereavement leave
• Reviewing the “failed” shared parental leave system
• Strengthening the rights of workers to respond to family emergencies with paid family and carer’s leave.

Detail on how these rights will be enhanced is yet to be provided, but if these changes come to fruition, schools will need to be ready to comply and meet any associated cost increases.

Labour have also committed to strengthening protections for pregnant staff by making it unlawful to dismiss an employee while pregnant or for six months after their return, except in specific circumstances. The current government has recently passed legislation that increases protections from redundancy for pregnant employees. However, it appears that Labour’s proposal will extend those protections beyond redundancy situations alone.

Labour also plan to allow workers the right to request flexible working from day one of employment – rather than the current 28 weeks’ service.  If elected, Labour may also take this further by changing the right to ‘request’ flexible working to simply being a ‘right’ to work flexibly.

Introduce a “right to disconnect”

Labour pledge to give workers the right to ‘switch off’ from work and not to be contacted by their employers outside of working hours. The right to disconnect is not an entirely new concept with several EU member states having already introduced it. It is not yet clear what, if any, exceptions would be made to this new right and what the consequences for breach would be.

Introduce mandatory ethnicity pay gap reporting

As far as pay transparency is concerned, Labour plans to make ethnicity pay gap reporting mandatory for employers with 250+ staff – a proposal that was scrapped by the Conservative government. Labour also intend to drive efforts to close pay gaps by forcing employers to not only report on their gender and ethnicity pay gaps, but to devise and implement plans to eradicate any such pay gaps.

Enhance the enforcement of employment rights

In the context of litigation, Labour proposes to extend the time period for bringing claims to an Employment Tribunal, albeit it remains unclear by how long. The party has also suggested that it will remove the statutory cap on compensation for claims of unfair dismissal.

What does this mean for schools?

Although this note only provides an overview of some of the proposals outlined in Labour’s green paper, it demonstrates the party’s intention with regard to employment law. In summary, the party pledges to “build an economy that works for working people”.

If implemented, these changes will amount to the largest shake up of employment rights in decades.

For now, it is important that schools are aware of the potential for significant change in several aspects of employment law. Schools should reflect upon how any such changes may impact their current working arrangements, policies and procedures. We will of course keep schools updated.