Ministers will push ahead with strengthening union and workers’ rights in key areas such as unfair dismissal, zero hour contracts and sick pay, despite having pledged to take on board concerns from businesses.
More than 200 new amendments to the government’s flagship employment rights bill are due to be published on Tuesday, fleshing out the details of some of those policies that are designed to tilt the balance of power from bosses to workers.
Employers are concerned that the sweeping package — including lowering the bar to strike action and a crackdown on practices such as zero-hours contracts and “fire and rehire” — will drive up costs on top of the increases in taxes and minimum wage rates they already face from April.
The government said last month that business leaders were “pushing at an open door” in their attempts to soften some elements of the legislation.
Jonathan Reynolds, business secretary, said the bill was “a core part of our mission to grow the economy” by tackling low pay, poor working conditions and poor job security, and that the government was “committed to working with all stakeholders on how best to put these measures into practice”.
However, his statement did not point to any substantive change to the measures in the bill that employers are most concerned about, including the introduction of so-called day one protection against unfair dismissal, a near-ban on the use of “fire and rehire” tactics, and a sweeping upgrade of union rights.
Instead, several changes to the bill will strengthen workers’ rights further.
A set of amendments will clamp down on “union-busting” tactics used by big employers to stave off unions’ bids to win collective bargaining rights.
These will include a ban on employers “flooding” workforces to try to dilute union membership ahead of union recognition ballots — such as by bringing in large numbers of workers on temporary contracts beforehand.
Separate amendments will shorten the notice period unions need to give before staging strike action, and double the period over which strikes can continue until they need to renew their mandate through a fresh ballot, from the current six month limit to a year.
Paul Nowak, general secretary of the Trades Union Congress, the union umbrella body, said the “common sense reforms” would prevent employers using “egregious tactics” to stop workers having a voice.
But Jane Gratton, deputy director for public policy at the British Chambers of Commerce, said the changes were “a concern to business”, adding that it was in no one’s interests to have “a situation where it is easier and faster to end up with strike action”.
Tina McKenzie, policy chair of the Federation of Small Businesses, said ministers had “missed an opportunity to intervene and help businesses cope”.
The chief concerns for small businesses were still “the threat of being taken to court as soon as they take a risk hiring someone, the affordability of proposals on sick pay, and the sheer unworkability of other parts of this mass of complex new rules”, she added.
Sick pay for the lowest-paid workers will be set at a higher rate than previously expected, at 80 per cent of normal earnings, and there will be clearer rights to bereavement leave for parents suffering a miscarriage.
The amendments will also increase penalties for companies that breach rules on collective redundancy consultations, to a maximum of 180 days of workers’ pay, up from 90 days at present. However, the government has held back from making the penalties unlimited — an option it consulted on.
Businesses have also won changes to provisions that could have left big companies in constant consultation when they were planning redundancies across a number of sites. The government said its amendments meant they would need to consult when laying off more than 20 workers at one site or when making a certain proportion of their overall workforce redundant.
Gratton said it was also a relief that the government had confirmed employers would be able to hire people on probation for nine months without falling foul of new rules on unfair dismissal. The government confirmed the commitment and said ministers would consult on how this process would work.
The government has also left scope for further consultation on how the so-called ban on zero-hour contracts will apply to agency workers. Ministers believe it is essential to include them, to avoid employers sidestepping their obligations by hiring temps. But business groups are worried the change will undermine their ability to call on a flexible workforce.
Reynolds said the amendments would allow flexibility on whether agencies or end users were responsible for offering workers guaranteed hours, and precisely how they were compensated for shifts cancelled at short notice.
People working through so-called umbrella companies will be treated in the same way as those taken on directly by a recruitment agency — a change recruitment agencies had been seeking, to avoid being undercut.
Another amendment will give greater powers to a Fair Work Agency, or FWA, to crack down on poor practices, with powers to carry out investigations and bring civil cases against rogue employers at employment tribunals, as well as to issue civil penalties — including fines — to employers breaching pay-related rights.
These changes are likely to be welcomed by business groups, who want enforcement strengthened to ensure a level playing field, and say civil actions can be quicker and less costly than long tribunal cases.