Agency workers will be covered by new rules to end exploitative zero hours contracts, collective redundancy protections will be increased, statutory sick pay (SSP) will be extended, and umbrella companies will face stricter rules.
These changes were outlined by the government today as part of amendments to the Employment Rights Bill.
The amendments confirmed that 900,000 UK agency workers should be able to access a contract which reflects the hours they regularly work. This change to the bill has been made to stop agency work becoming a loophole where exploitative zero hours contracts can still be used. Under the rules workers must receive reasonable notice of shifts and proportionate pay when shifts are cancelled, curtailed or moved at short notice. The government said this still allows for flexibility in how employers manage their workforces.
To prevent potential abuses of collective redundancy rules, the government has increased the maximum period of the protective award from 90 days to 180 days. It has also drawn up further guidance for employers on consultation processes for collective redundancies. Employment tribunals will also be able to grant larger awards to employees where an employer fails to meet consultation requirements.
Further bill amendments included the creation of a modern framework for industrial relations to align it today’s practices. The government said: “We are ensuring industrial relations are underpinned by collaboration, proportionality, accountability, and a system that balances the interests of workers, businesses and the wider public, with further details in the consultation response.”
As trailed yesterday, SSP will be extended by making it a legal right for all workers from the first day of sickness absence. Employees off sick will be entitled to 80 percent of their average weekly earnings or the current rate of SSP, whichever is lower.
This will reduce the amount of people going to work when ill and therefore the spread of infections in the workplace, which in turn will boost productivity and benefit businesses, the government said.
The government’s amendments also add extra protections for workers employed through an umbrella company so that they have the same rights as they would when taken on directly by a recruitment agency. It warned that enforcement action would be taken against umbrella companies that do not comply.
Business secretary Jonathan Reynolds said: “Many businesses already have worker friendly practices in place and can attest to the positive impact they have on retention, productivity and job satisfaction. We want to go further and untap the UK’s full potential by attracting the best talent and giving business the confidence to hire to help the economy grow.”
Jane Gratton, deputy director of public policy at the BCC, said: “Employers will be relieved to see some amendments, at what is clearly a milestone moment for government. It has consulted business – and this is reflected in some of the decisions on the future shape of the legislation. There is much here to welcome as sensible moves that will help ensure that employment works for both the business and the individual, including the nine-month statutory probation period and the promise of a light touch approach, as well as simplifying rules on collective consultation.
“But businesses remain cautious, and it is important to continue ensuring the bill strikes the right balance. Employers will look forward to hearing, engaging with and shaping further detail. The government must continue its positive approach to engagement with firms and remain open to changes. Doing so will ensure this legislation is proportionate, affordable, and right for both firms and their employees.”
Ben Willmott, head of public policy at the CIPD, said it was “positive” to start to see more detail on some of the provisions in the bill as this will help employers plan for the future. “However, the sheer number of amendments to this legislation published by the government underlines the size and complexity of this bill for employers,” he added. “The government must ensure that, through consultation, the detail of the measures are workable and can improve workplace practices.
“Just as important, the government needs to urgently prioritise an implementation plan, working with the CIPD and other employer organisations, including a clear phased timeline, alongside support and guidance for employers.”
Commenting on the amendments that will see zero hours measures apply to agency workers, Willmott said: “It’s good that the government is allowing more time to try and find a workable solution to the challenge of applying the proposed new right for zero hours contract workers to have a guaranteed hours contract, to agency workers However, if no effective approach can be developed that works for recruiters, employers and agency staff, the government must be prepared to recognise this and exempt agency workers from these provisions.
“Agency workers play a crucial role in the UK’s temporary flexible workforce which helps employers manage peaks and troughs in demand and bring in specialist skills. Agency work also provides valuable flexibility for individuals and a route into permanent employment.
“The plan to offer zero-hours workers compensation for late notice shift cancellation will go some way towards addressing the government’s concerns about one-sided flexibility and help ensure that what’s existing good practice in many organisations becomes the norm.”
He also highlighted the plan to modernise the framework for industrial relations that will make it easier for unions to achieve recognition, access workplaces and to take industrial action, saying this will have “significant implications” for many businesses.
“We must see further consultation with employers on key aspects of these proposals to ensure they can support effective collective employment relations and partnership working between employers and trade unions, and don’t undermine workplace democracy.
“More broadly, there’s a need for the government to consider other changes to the employment relations infrastructure and institutions, including more resources for the Central Arbitration Committee and Acas. Many employers will have no experience of working with trade unions and will need support in order to develop the necessary employment relations skills and avoid disputes.”
