Labour’s ‘Plan to Make Work Pay’: How to Prepare Your Business

The Labour Party’s “Plan to Make Work Pay” promises significant changes to UK employment law. With these changes potentially taking effect within 100 days of Labour forming a government, businesses need to proactively prepare.

Day One Unfair Dismissal Rights: A Major Shift

One of the most impactful proposals is granting employees the right to claim unfair dismissal from day one of employment. Currently, employees need two years of service to qualify for this protection. Dismissing an employee during this time is often more straight forward and lower risk.

Labours proposed plan to offer protection against unfair dismissal from day one of employment represents a pivotal shift, ensuring greater job security for all employees immediately starting a new job.

In removing this qualifying period, all employers will need follow the statutory disciplinary rules on carrying out a fair dismissal for all staff.  The key to managing this change and minimising the increased risk of a claim to an already stretched Employment Tribunal System, would be to ensure you have the right staff from the beginning with the correct terms and conditions of employment.

If this change is imminent, what impact will it have on employers?

• Increased Compliance: Employers will need to update policies and procedures to ensure compliance with the new regulations.
• Enhanced Hiring Practices: More rigorous screening and probationary processes will become essential to make informed hiring decisions.
• Robust Probationary Periods: Structured probationary periods with regular feedback will be crucial in assessing new employees’ suitability.
• Higher Costs: Legal and administrative costs associated with managing potential disputes may increase.

While Labour intends to allow probationary periods, the specifics of how these will work alongside the new unfair dismissal rights remain unclear.

Additional Day One Rights and Key Reforms:

Labour’s proposals also extend day one rights to statutory sick pay, parental leave, and flexible working (this became a day one right on 6th April 2024 for requesting flexible working, but Labour want to take this further).

Other potential changes include:

• Extended Tribunal Time Limits: Employees would have six months (instead of three) to bring a claim before an employment tribunal.
• Unified Worker Status: A single “worker” status would be created for all employment types.
• Zero-Hours Contract Elimination: This controversial contract type may be phased out.
• Restrictions on “Fire and Rehire”: Practices of firing and rehiring employees on less favourable terms could be curtailed.

How A4G’s HR Service Can Help:

To navigate these changes and ensure compliance, A4G’s HR services can provide valuable support by:

• Creating Bespoke Contracts: Tailoring employment contracts to the specific needs of your business and the new regulations.
• Policy Review and Development: Reviewing existing policies or creating new ones to align with the updated legislation.
• Probationary Process Implementation: Designing and implementing comprehensive probationary period processes with clear objectives and feedback mechanisms.
• Performance Management Solutions: Developing tools to support fair and justified employment decisions.
• Employee Engagement Strategies: Enhancing recruitment and onboarding processes to attract and retain top talent.

Other Practical Steps to Make: 

• Comprehensive Role Definition: Clearly define and document every role within your business, distinguishing between primary and multi-person roles. Create an organisational chart illustrating reporting structures for clarity.

• Invest in Training: Implement comprehensive training programs to ensure employees understand their roles and responsibilities. Incorporate training on productivity tools like AI and automation to optimise efficiency.

• Regular Performance Reviews: Conduct documented monthly reviews with each employee to track progress, address concerns, and provide constructive feedback.

• Transparent Communication: Openly communicate company goals and expectations to foster a collaborative and informed workforce.

Don’t Delay – Prepare Now!

By proactively addressing these changes, you can minimise disruption to your business and ensure a smooth transition when the new employment laws come into effect. Partnering with A4G’s HR service can provide peace of mind and help you confidently navigate this evolving landscape.

Email enquiries@a4g-llp.co.uk or call 01474 853 856 to find out more.