The UK government is moving forward with a significant expansion of protections for workers as part of its Employment Rights Bill. One of the key provisions in this legislation is a ban on zero-hour contracts for agency workers, a change that will impact approximately one million workers across various industries. The bill includes around 250 amendments, and while the proposal is seen as a positive step by many unions, there are concerns about the lack of clarity in certain aspects of the law.
Agency Workers to Receive Compensation for Last-Minute Cancellations
Under the new bill, agency workers who are on zero-hour contracts will be entitled to compensation if their employers cancel or alter their shifts at short notice. However, the amendment does not specify what qualifies as “short notice,” leaving room for interpretation. Currently, zero-hour contracts have been a controversial aspect of the UK labor market, as they provide no guarantee of hours worked, leading to unpredictable income and job insecurity for many workers.
The new provisions will apply to a wide range of agency workers, including those employed in industries such as hospitality, warehousing, and healthcare, particularly the NHS. The law’s extension aims to prevent unfair treatment by ensuring that workers are compensated if employers make sudden changes to their work schedules without adequate warning.
Guaranteed Minimum Weekly Hours for Agency Workers
The bill also proposes that businesses must provide agency workers with contracts that guarantee a minimum number of weekly working hours. This minimum will be based on the worker’s average hours worked over a set period. However, the government has yet to decide whether to use a 12-week reference period or a longer duration. This change aims to give agency workers more stability and financial security by ensuring they are not left without work or pay for extended periods.
While unions have largely welcomed these changes, there are concerns about the potential impact on the flexibility that zero-hour contracts provide. The Recruitment and Employment Confederation (REC), which represents recruitment agencies, has expressed concerns that the new rules could restrict workers’ ability to choose flexible working arrangements. Some agency workers prefer the ability to work variable hours, and the REC has cautioned against restricting this flexibility in the name of worker protection.
Unions Advocate for Stronger Worker Protections
Unions, particularly the Trades Union Congress (TUC), have long argued that agency workers should be included in the zero-hour contract ban. Paul Novak, the General Secretary of the TUC, commended the government’s decision to extend the ban to agency workers, calling it an important step in closing what he described as a “loophole” that allowed some employers to exploit workers by relying on agency staff. Novak emphasized that agency workers make up a large portion of the zero-hour workforce and require stronger protections to prevent unfair treatment.
However, the REC’s Deputy Chief Executive, Kate Shoesmith, voiced concerns that the new regulations could undermine the flexibility that many agency workers value. Shoesmith pointed out that many people opt for agency work because it offers the freedom to choose when and where they work. She stressed that while protections are important, the government should be careful not to strip workers of the very flexibility that makes agency work appealing to some.
The REC has committed to ongoing discussions with the government to ensure that the legislation strikes a balance between protecting workers and maintaining the flexibility that some workers desire. It remains to be seen how the government will address these concerns in the final version of the bill.
Other Employment Rights Reforms
In addition to expanding protections for agency workers, the Employment Rights Bill includes several other significant reforms that will impact workers across the UK. One of the key changes involves increasing penalties for employers who engage in “fire and rehire” tactics, which have been criticized for unfairly dismissing employees and rehiring them on less favorable terms. Under the new bill, businesses that engage in these practices will face a penalty of 180 days’ wages per affected worker, double the previous penalty of 90 days.
The bill also includes provisions to extend sick pay coverage to workers earning under £123 per week. These low-income workers will now be entitled to receive 80% of their average weekly earnings or the statutory sick pay rate of £116.75 per week, whichever is lower, from the first day of illness. Currently, statutory sick pay is only available to employees who are ill for three consecutive days.
Other changes in the bill include adjustments to trade union regulations. Workers will now be required to provide employers with 10 days’ notice before striking, instead of the previous 14-day notice period. Additionally, the government will be granted the authority to lower the minimum workforce percentage required for union recognition ballots, although it remains unclear what the new threshold will be.
Concerns from Business Groups
Despite the government’s assurances that these changes will benefit both workers and businesses, several business groups have raised concerns about the potential financial burden of the proposed amendments. Martin McTague, the National Chair of the Federation of Small Businesses (FSB), expressed concern that small businesses may struggle to absorb the costs associated with the new laws. He revealed that two-thirds of small businesses are reluctant to hire new employees due to the proposed regulations, and a third of small businesses are considering reducing their workforce.
McTague also criticized the government for failing to provide adequate support to small businesses in funding sick pay and adjusting dismissal rights. He warned that these changes could negatively affect economic growth, particularly if small businesses are not given the resources and assistance they need to implement the new rules effectively.
Conclusion
The UK government’s proposed amendments to the Employment Rights Bill represent a significant shift in labor protections for agency workers and other employees. While unions have largely welcomed the changes, concerns remain about the potential impact on flexibility for workers and the financial burden on small businesses. The government will need to carefully consider these concerns as it moves forward with the legislation.
These changes are part of a broader effort to improve workers’ rights and create a fairer, more modern economy. However, the lack of clarity in some areas of the bill, such as the definition of “short notice” and the potential impact on business flexibility, has left some questions unanswered. The government has pledged to continue working with stakeholders to refine the bill before it is passed into law.
For more updates on the Employment Rights Bill and other important labor reforms, visit Wallstreet Storys.
