Is the end of the 2-year Unfair Dismissal rule in sight? An overview of the new Employment Rights Bill
On 10th October 2024, the highly anticipated Employment Rights Bill was published by the government, outlining several significant reforms to be made to employment law, which are set to completely transform the current legal landscape.
It is important to note, however, that these reforms are only anticipated to take effect from 2026, as the bill makes its way through the various stages of Parliament.
The current law states that employees are required to have worked for two years before they obtain certain statutory rights, such as the right not to be unfairly dismissed.
The bill released earlier this month proposes to abolish the two-year rule, meaning that employees will be able to make a claim for Unfair Dismissal from day one of their employment.
The bill sets out that there will be an “initial period”, expected to be for 9 months, where the dismissal procedure will be less complicated and quick for employers to follow, if they wish to dismiss an employee. This is likely to include a meeting with the employee to detail performance or conduct concerns.
Restrictions on ‘fire and rehire’
The latest rules on fire and rehire were put in place in July 2024, and employers are currently able to conduct the practice.
Under the new bill proposed by the Government, employers will be significantly restricted from using their fire and rehire ability to change terms and conditions of employment. If an employer therefore dismisses an employee because the employee did not agree to an employer’s attempt to vary the terms of their employment, or due to the fact that the employer intends to hire another individual to carry out the same role but on varied terms, an employee will be entitled to claim for Automatic Unfair Dismissal.
Zero Hour Contracts
The current law does not prohibit nor prevent zero-hour contracts from being offered to employees.
It was highly anticipated that the new Employment Rights Bill would seek to ban these contracts, however, this is not the case. Instead, the bill introduces several provisions, which are presumably intended to limit the exploitative effect of Zero Hour Contracts.
Currently, employees do not have a right to have guaranteed hours. With the new bill, employers will be required to offer employees guaranteed hours of work, after the end of a ‘reference period’, which is anticipated to be 12 weeks. It is important to note that currently, these provisions do not apply to agency workers. However, the bill does include the power to extend its application to agency workers if required.
Further, employers currently do not have to provide a set notice of shifts than an employee must work. As an example, an employer could request for the employee on a Zero Hour Contract to complete a shift the next day. Under the new bill, employees will have the right to have reasonable notice of a shift they are required to work, including the time, day and how many hours they will be required to work.
Flexible Working
Employees currently have the legal right to request flexible working from day 1 from their employers. Employers can refuse the request based on at least one of the following reasons:
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The burden of additional costs
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Detrimental effect on ability to meet customer demand
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Inability to reorganize work among existing staff
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Inability to recruit additional staff
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Detrimental impact on quality
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Detrimental impact on performance
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Insufficiency of work during the proposed working periods
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Planned structural changes to the business.
Whilst a refusal to flexible working can only be made by an employer under the above reasons, their refusal does not currently have to be reasonable.
The proposed bill does not change the eight reasons that an employer can refuse a flexible working request, however, it introduces the requirement that any refusal must be reasonable, and an employer must provide written reasons of the ground for any refusal and why a refusal is considered to be reasonable.
Sexual Harassment as a Whistleblowing Disclosure
Currently, if an employee is looking to receive whistleblowing protection and have the right to make a whistleblowing claim to the Employment Tribunal, they must make a ‘qualifying disclosure’, which must fit into one of the following categories:
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That a criminal offence has been committed, is being committed or is likely to be committed
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That a person has failed, is failing or is likely to fail to comply with any legal obligation to which they are subject
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That a miscarriage of justice has occurred, is occurring or is likely to occur
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That the health or safety of any individual has been, is being or is likely to be endangered
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That the environment has been, is being or is likely to be damaged, or
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That information tending to show any matter falling within any one of the above has been, is being or is likely to be deliberately concealed
The new Employment Rights Bill proposes for a disclosure of sexual harassment to be added into the list of qualifying disclosures, as long as it is made in the public interest.
Family Rights
The Employment Rights Bill proposes to remove the current one year length of service requirement for parental leave, meaning that employees will be eligible to take parental leave from day one of their employment.
Furthermore, employees are only eligible to take paternity leave when they have been employed for at least 26 weeks (6 months), and the bill proposes to remove any length of service required to take paternity leave.
Other notable expected future changes
Whilst the Employment Rights Bill does not make mention to this, the ‘Next Steps’ document published by the government alongside the bill proposes to remove the distinction between ‘employees’ and ‘workers’, thus giving workers the same legal rights as employees.
Another notable expected reform relates to the extension of time to bring Employment Tribunal claims. Currently, most claims must be brought within three months of the act complained of, e.g. dismissal or discrimination. Whilst the bill does not make any explicit reference to this, a 6-month time limit extension has previously been discussed.
It is important to note that the bill is currently not law. It will have to navigate through both houses of Parliament, where it is likely to be heavily debated and amended. It may be, therefore, that if the bill does pass into law, at some point within the next couple of years, it may be look different than what is currently being proposed.
With offices in Leicester and Market Harborough our employment solicitors and lawyers can discuss your employment issues at any of our branches. In addition, we are a national provider of expert employment law advice and welcome a free discussion with you regarding your circumstances and potential claim.
If you believe you have a situation where you require free legal advice, please contact us on telephone 0116 212 1000 or 01858 445 480, alternatively fill in the free Contact Us form and we will get in touch as soon as possible.
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