Skip to content

The King’s Speech: Employment Rights Bill

Blog

abstract_people

The King’s Speech is a crucial constitutional event in UK parliamentary democracy, outlining the laws the Government intends to introduce in the parliamentary session ahead.  

On 17 July 2024, the newly formed Labour Government delivered its first King’s Speech, promising not one, but two, employment-related bills:

  • An Employment Rights Bill
  • A draft Equality (Race and Disability) Bill

Although an Employment Bill was proposed by the previous Conservative Government in 2019, it was never published and instead reforms were made in piecemeal fashion, including via a number of Private Members’ bills. 

In contrast, the new Government has reiterated its promise to introduce its Employment Rights Bill within the first one hundred days, in what is describes as “the biggest upgrade to workers’ rights in a generation”. 

Here we look at what the two proposed employment bills are intended to cover and what is likely to happen next. 

Employment Rights Bill

“My Government is committed to making work pay and will legislate to introduce a new deal for working people to ban exploitative practices and enhance employment rights.”

Alongside this commitment in the King’s Speech, the Government’s background briefing notes, published at the same time, contain more detail about the employment policies the Government intends to introduce in its Employment Rights Bill. In particular, Labour reiterates its commitment to deliver the following:

  • Ban exploitative zero-hours contracts.
  • End "fire and rehire" and "fire and replace".
  • Make parental leave, sick pay, and protection from unfair dismissal a day one right for all workers (subject to probationary periods to allow employers to assess new hires).
  • Remove the lower earnings limit and the waiting period for Statutory Sick Pay.
  • Make flexible working the default from day one for all workers.
  • Strengthen protections for new mothers, making it unlawful to dismiss a woman who has had a baby for six months after her return, other than in exceptional circumstances.
  • Establish a Fair Work Agency to strengthen enforcement of workplace rights.
  • Update trade union legislation, removing restrictions on trade union activity and simplifying the statutory recognition process.

Although there are no surprises in this list, it does confirm Labour’s intention to follow through with its Manifesto promises. The changes that are likely to have the most substantial impact on employers are unfair dismissal protection being made a day one right, the extension of that protection to workers, and flexible working being made the default. All of these represent a considerable departure from current employment practices and are likely to require employers to think carefully about their recruitment procedures and the effective management of probationary periods.

Draft Equality (Race and Disability) Bill

“Legislation on race equality will be published in draft to enshrine the full right to equal pay in law.”

The briefing notes make it clear that the Government intends to “tackle inequality for ethnic minority and disabled people” by:

  • Introducing a statutory right to equal pay for ethnic minorities and disabled people.
  • Introducing mandatory ethnicity and disability pay reporting for large employers (with more than 250 employees).

This is not the first time that ethnicity pay reporting has been proposed, with the previous Conservative Government holding a consultation on it in 2019. However, at that time, the government decided not to make ethnicity pay reporting mandatory, acknowledging the difficulties that come with it, including confidentiality, complexities in obtaining correct data and the burden on businesses. These are all issues which Labour will need to consider as part of its proposals, and the fact that this is described as a “draft” bill suggests it may be subject to consultation before it is put before Parliament. It could therefore be some time before we see it becoming law.

For more information on what ethnicity pay gap reporting might involve and what employers can do if they would like to report, see our blog Ethnicity pay gap reporting: where are we now?

Additional implications for employers

As well as the two employment bills, several other aspects of the King’s Speech will be of relevance to employers:

  • The Government intends to introduce a “genuine living wage”, including removing what it describes as “discriminatory age bands”.
  • Despite rumours about a specific AI bill, this has not been announced. Instead, the King’s Speech stated that the Government will seek to establish “appropriate legislation” to place requirements on those developing AI models. For now, therefore, this is unlikely to have an impact on the use of AI by employers and the current regulatory and legal landscape (as explained in this blog) will remain the same.

What happens next?

As so often with these types of commitments, it is the detail which will be key, and we will need to see copies of the draft legislation itself in order to fully understand what changes are being introduced, whether any exceptions might apply, and how the reforms might work in practice.

Timing-wise, the briefing note reiterates Labour’s promise that the Employment Rights Bill will be “introduced within the first one hundred days”. Depending on whether the clock starts ticking from the date Labour got into power or the date of the King’s Speech, that takes us to somewhere between 12 and 25 October 2024.

However, it is worth noting that in the UK, saying that a bill will be “introduced” refers to the process by which a proposed piece of legislation is formally presented for consideration by Parliament. It is the first step in a process which includes a number of stages, including both Houses of Parliament being given the opportunity to debate and propose amendments to the draft legislation. Only once both Houses have agreed the final content of the bill will it receive Royal Assent and become law. 

With a bill of this size, the parliamentary process is likely to take a number of months and the bill could go through various forms before it is approved. Even once a bill passes into law, there are often transition periods, updates to Code of Practice or further guidance required before it can actually take effect. As a result, any actual change is unlikely to happen until next year at the earliest. Nevertheless, it is clear that significant change is on the horizon which could have far-reaching implications for employers and employment practices. It is certainly worth keeping an eye on developments to ensure you are prepared when the time comes.

This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.

© Farrer & Co LLP, July 2024

Want to know more?

Contact us

About the authors

Amy Wren lawyer photo

Amy Wren

Senior Counsel

Amy is a Senior Counsel and Knowledge Lawyer in the employment team, providing expert technical legal support to the team and leading its know-how function. Given the fast-changing nature of employment law, Amy ensures the team is at the forefront of all legal changes and can provide the best possible advice to our clients.

Amy is a Senior Counsel and Knowledge Lawyer in the employment team, providing expert technical legal support to the team and leading its know-how function. Given the fast-changing nature of employment law, Amy ensures the team is at the forefront of all legal changes and can provide the best possible advice to our clients.

Email Amy +44 (0)20 3375 7627

Related sectors & services

Back to top