Election special - overview of the new employment rights promised by Labour and Conservative parties
- 18 May 2017
As the election race gathers pace, both main parties have been keen to portray themselves as the friend of the average worker. The rights of employees, unions and the self-employed have been given a central place in both parties' plans, and employers will be watching the result keenly.
The Conservatives announced on Monday an 11-point plan to introduce a range of new measures. Mrs May then quickly added point 12, in the shape of ethnicity pay gap reporting. On Tuesday, Labour's manifesto upped the ante with 20 proposals for employees, and a range of other ideas aimed at the gig economy. The full Conservative manifesto has promised yet further new initiatives. Alongside the NHS, Brexit, education and tax, employment appears to be a key battleground for June.
The parties' headline employment plans are:
- Qualifying periods: Labour have proposed giving all employees the same rights from day one. Whether that means all employees would have unfair dismissal rights immediately is unclear - if that is the intention, that would be a very significant reform.
- Zero hours contracts: Labour propose an outright ban on zero hours contracts, plus a new right for those who work regular hours to a contract reflecting those hours.
- Collective bargaining: Labour have suggested the Trade Union Act 2016 should be repealed and that sectoral collective bargaining should become the norm.
- Public holidays: Labour have proposed four new bank holidays, one for each of the national saint's days.
- Pay: Both parties have pledged to increase the national minimum wage. The Conservatives have promised an increase in the NMW to 60% of median earnings until 2020 and then by the rate of median earnings thereafter. Labour has said it would increase the NMW to the level of the Living Wage (the gap at present is £7.50 v £8.45, or £9.75 in London). There have also been commitments from both sides on executive pay. Labour have also announced they would introduce a maximum pay ratio of 20:1 in the public sector and for all companies tendering for public sector contracts. The Conservatives say they would tighten the rules of shareholder control of executive remuneration, and oblige listed companies to publish their pay ratios.
- Pay gap reporting: The Conservatives have announced they would replicate the gender pay gap reporting regime to oblige employers to publish pay data broken down by ethnicity. The manifesto uses the phrase 'ask employers to publish', so it may be that the planned regime will be voluntary rather than mandatory. Labour have suggested amending the gender pay gap reporting regime to introduce a civil enforcement mechanism.
- Employment Tribunal fees: Labour have pledged to abolish the fee regime introduced in 2013.
- Family-friendly leave: The Conservatives have announced they would introduce a new right to time off to care for sick relatives and a right to time away from work on the death of a child. Labour say they would increase statutory paternity leave from two weeks to four and strengthen the rights of women from being unfairly made redundant.
- Corporate governance: The Conservatives remain committed to some form of worker representation on boards and say they will legislate for employees to be given the same access to company information as shareholders. The options for listed companies will be a director appointed by workers, a formal employee advisory council, or a designated non-executive director with responsibility for employee representation. Labour, on the other hand, will require all takeover proposals to include a plan dealing with employees and pensioners
- Employment status and the gig economy: Employed workers operating in the gig economy ought to have. Labour also suggest they will legislate so that all workers are assumed to be employees unless the putative employer can demonstrate the contrary.
At present, all of these ideas appear at an early stage of development and many would need to be analysed in detail in order to form a sensible view on their merit and likely effect in practice. For employment lawyers and HR teams, these are interesting times.
AUTHOR(S): Seán Lavin, Matthew RamseySubscribe to updates