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Get in touch 0117 325 0526
Although Labour were clear that they would initiate major employment reforms, it was only as their large majority became likely that the detail of their reforms grabbed people ‘s interest. Labour have promised to introduce legislation in 100 days. Now they are forming the next Government, we summarise their planned reforms, called Labour’s plan to ‘Make Work Pay’ (previously titled ‘Labour’s New Deal’ ).
Labour’s proposals mean more rights and more security for individuals – and a likely increase in individuals seeking redress (internally and through litigation). Employers will need to adjust, particularly to the very significant abolition of the 2-year rule for unfair dismissal. They may see costs rise and, overall, some aspects of employing people are likely to feel less flexible. However, many employers who already follow good HR/People practices and hire intelligently are unlikely to suffer much.
Labour’s list of employment reforms:
Labour’s list is substantial and ambitious. It would represent a considerable shake-up of the current employment landscape:
Importantly, Labour say they will introduce enhanced enforcement of employment law by making it more effective and ensuring their proposals have teeth.
What might the consequences be?
Those employers with good HR/People and hiring practices are unlikely to feel much pain. The biggest change is likely to be the bringing forward of unfair dismissal rights to the start of employment (as opposed to these only being gained after 2 years).
The current approach of ‘trying someone out’ for the first two years will need to be a thing of the past. Recruitment practices will need to improve radically for many employers, in order to try to ensure that they hire the right people, with the right skills and attitude, and who really fit the role, from the outset. This has to mostly be a good thing, since many employers (particularly smaller ones) still have a rather ‘pot luck’ approach to recruitment, and they will not be able to afford to continue with that. Lazy or non-existent performance management will hopefully become less viable for businesses.
There are likely to be more Employment Tribunal claims in general, if the limitation period for commencing one is increased to 6 months, although we don’t predict an enormous increase.
Right to switch off
The right to switch off may prove to be the most significant reform and the one requiring the most cultural and managerial change. Many businesses (particularly the legal sector!) rely on staff working themselves to pieces in the evenings and weekends, and this may be forced to reduce. On the other hand, the notion of ‘contractual hours’ may be extended to cover evenings. It’s hard to know at this stage.
Senior managers and leaders in most sectors are going to need to reflect on their working and emailing hours and hopefully make some healthier decisions. We know too many HR professionals (especially the senior ones) who have fallen into the trap of habitually working crazy hours. At the time, it can often feel like this over-working is ‘necessary’, but we expect this legislative change is going to spark a big, reflective debate on our often insane working hours in the UK, particularly amongst those who ought to be setting a better example to others. We don’t use the word ‘insane’ flippantly. A lot of the mental health crisis in working-age adults in office-based roles is surely fuelled by long hours and an inability to stop checking their emails outside of working hours. Let us hope that some good can come here.
Unintended consequences?
As well as more rights for workers, we also predict some unintended consequences for employees, as businesses react to the above changes, tightening up on certain practices and perhaps being more reluctant to hire. We can expect a lot more debate and discussion of these down sides when legislative changes come in.
Get ready
Labour say they will not drag their heels on making changes to the employment landscape. In terms of preparation, employers are well advised to start considering the impact of the proposed changes on their workforce, their practices and their costs.
We recommend that a great starting point is to tighten up your recruitment processes, seeing what more you can do to hire the right people with the right skills into the right roles in the first place. It might be worth reflecting on your last few years’ worth of dismissals for poor performance, misconduct and ‘not being the right fit’ and see what additional lessons you can learn now. This surely has to be a worthwhile exercise.
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