Labour’s New Employment Rights Bill

The Labour government Employment Rights Bill (“the Bill”) was laid before parliament on 10 October 2024, at more than 150 pages and containing 28 employment measures, it should not be underestimated. Hailed as “the biggest upgrade to workers’ rights in a generation,” it is a significant piece of legislation in the UK. Much of what is proposed is ambitious and will represent a marked shift from existing practices.

Its implementation is likely to have a range of implications for independent schools, particularly in terms of employment practices, the protection of employees, and compliance with new legal requirements.

However, change will take time. Its accompanying document, “Next Steps to Make Work Pay” sets out detailed plans about how Labour intend to bring the reforms into effect. The Government expects to begin consulting in 2025 and anticipates that the majority of the reforms will not impact immediately, with the majority not anticipated to come into effect until 2026, following a substantial transition period.

Below is an outline of the main issues and impact the Bill might have on independent schools.

1. Enhanced Worker Protections

The Bill is designed to strengthen workers’ rights in several areas. Independent schools, like other employers, will need to ensure compliance with these enhanced protections for their staff, including:

• Unfair dismissal protection: Currently employees must have at least two years continuous service to bring an ordinary unfair dismissal claim (save for some exceptions). It is proposed that the qualifying service requirement will be removed, and all employees will be able to claim unfair dismissal from day one.
  This will only apply to employees, not workers. However, the Government have confirmed a review of worker status in the long term. It’s anticipated that approximately nine million more employees would be able to bring claims.
• Probationary periods: It is suggested that the Bill will balance giving staff protection against unfair dismissal by allowing employers to operate probationary periods. It Is not yet clear what process will be required but the Government intends to legislate to “introduce fair and proportionate processes for dismissal” during probationary periods. It is anticipated this will include holding a meeting with the employee and, a preference of a probationary period of nine months has been indicated. The Government intends to undertake extensive consultation on this proposal.

Independent Schools will need to ensure robust recruitment procedures, allowing you to identify any issues early. It will be particularly important that Line Managers are trained to understand how probationary periods will operate and the process you are required to follow to minimise the risk f successful unfair dismissal claims.

• Fire and rehire practices: Despite controversy over this practice, the Conservative Government resisted calls for an outright ban and instead put in place a Statutory Code of Practice on dismissal and re-engagement, making clear that fire and-rehire should be a last resort.

The Bill will make it automatically unfair to dismiss an employee if the principal or fair reason for the dismissal is either:

• The employer sought to vary the employee’s contract of employment, and the employee did not agree the variation; or
• To enable the employer to re-engage the employee, or employ another person, under a varied contract to perform substantially the same duties as before.

The Bill provides an exception, if the employer can show:

• The reason for the variation was to prevent or significantly reduce financial difficulties.
• The financial difficulties were affecting the employer’s ability to carry on the business as a going concern.
• In all the circumstances the employer could not reasonably have avoided the need to make the variation.
• In determining fairness, the Tribunal must consider whether any consultation was carried out about varying the contract and if anything was offered in return for the variation.

This is likely to be a high bar for Independent Schools to meet. As drafted these provisions are likely to have extensive ramifications for employers seeking to change contractual terms or restructure. However, this is not often seen in a schools context so may not have a significant impact.

• Collective Redundancy: Currently collective consultation is required if an employer proposes to dismiss 20 or more employees as redundant in a period of 90 days or less. This number is based on “at one establishment”. The proposed changes to the rules are that the collective consultation threshold is increased so that it I s calculated across the whole business rather than a single establishment. It is also suggested that the cap on a protective award if an employer does not properly consult during collective redundancy, currently at 90 days’ gross pay, will be lifted.
  For Independent schools, this may mean collective consultation obligations are triggered more frequently placing a heavier administrative burden in terms of monitoring and record keeping. Depending on your structure and employing entities, you may need to be particularly careful should you have a group of schools and/or different businesses.
• Statutory Sick Pay (SSP): Currently only payable after the fourth day of sickness absence and if an employee meets the lower earnings threshold of at least £123 per week. It is proposed both these requirements will be removed, there will be an entitlement from day one and the Government will consult on what rate those below the threshold will receive.

This is likely to have little impact on Independent Schools as for many it is already common practice to provide contractual and/or enhanced sick pay from day one with payments over and above SSP.

• Equality Action Plans: Independent Schools with 250 or more employees will be required to produce action plans on matters relating to gender equality, including addressing their gender pay gaps and supporting employees through menopause.
  Again, this may have little impact as many Independent Schools are already taking steps to address this.

2. Family Friendly protection

Maternity protection: Additional protection is currently given to pregnant women and those returning from maternity leave or extended family leave in a redundancy situation. The Bill will strengthen protection, making it unlawful to dismiss a new mother within six months of their return to work, except in specific circumstances.

• Parental and paternity Leave: Currently an employee needs 26 weeks’ service to take paternity leave and at least one years’ service to take unpaid parental leave. It is proposed that this will become a day one right and other restrictions may be removed.
• Bereavement Leave: Currently a day one right but only covers a biological parent or those with parental responsibility. It is proposed that this will be extended to create a right to leave to a ‘relevant person.’ It is not yet clear what or who this may cover and is likely to be consulted on.
• Review: It is proposed that there will also be a full review of the parental leave system and carer’s leave.
  Independent Schools will need to accommodate these extended rights. You may now see such rights being exercised more regularly and have to consider how best to accommodate this and provide cover.

3. Right to Request Flexible Working

Following changes made from 6 April 2024, flexible working is currently a day one right and up to two requests can be made per year. Under the Bill, the Government suggest flexible working will become the ‘default’ position, not just a right to request. The eight statutory reasons to refuse a request will remain but there will be an added obligation on employers to demonstrate that it is “reasonable for the employer to refuse the request on those grounds”. This does not change the process but may impact schools in several ways:

• Increased Demand for Flexible Working: Teachers and staff may increasingly request flexible working arrangements, such as remote teaching, part-time hours, or adjusted schedules. Independent schools will need to ensure their policies and practices support such requests while maintaining operational needs.
• Managing Operational Impact: Schools will need to balance flexible working arrangements with maintaining quality of education and ensuring that staffing levels are sufficient to cover all required duties. This could require more strategic planning and investment in staff management.

4. Zero-Hours Contracts

Currently Independent Schools can agree to enter a contractual relationship with no minimum hours and without the obligation to offer or accept work, typically seen in contracts with invigilators or sports coaches.

The Government committed to “banning exploitative zero-hours contracts”. Whilst not going that far, the provisions in the Bill are detailed and complicated but in summary what’s proposed is:

A duty to offer qualifying workers a guaranteed-hours contract based on the hours they have been undertaking an ‘initial reference period and each subsequent reference period’. This will apply to both zero hours and ‘low’ guaranteed hours. The reference period is likely to be 12 weeks.

Workers will have the right to reasonable notice if they are required to work a shift, or if a shift is cancelled or changed. Compensation will be payable for any shifts cancelled or curtailed at short notice. There is not currently information on what will amount to ‘reasonable’ notice or ‘proportionate’ compensation.

Specific detail about how this will operate will be subject to consultation and secondary legislation. What is clear is that it is likely to introduce stricter regulations around zero-hours contracts and limit their use which may have a substantial impact on independent schools depending how often you sue these types of contacts.

Many independent schools rely on flexible staffing arrangements, such as zero-hours contracts for part-time teachers, support staff and others. Key impacts include:

• Clarification of Terms: Schools will need to provide clearer terms in zero-hours contracts, ensuring that staff understand their rights, including any guarantee of work, the right to reject shifts, and the circumstances under which the contract can be terminated.
• Potential Restrictions: There may be limitations on the use of zero-hours contracts for workers who work regular hours over a sustained period. Schools may need to offer permanent contracts or find ways to adjust staffing arrangements.
• Audits: It would be advisable to start auditing now how you engage workers and whether they may fall under this type of engagement so you can assess how many workers may be impacted.

5. Trade Unions/ Strike Action

The Bill will remove restrictions on trade union activity, introduce a process for requesting access to the workplace and require written particulars to include a statement that workers have a right to join a trade union.
Currently employees are protected against dismissal for taking part in strike action. The Bill proposes that employees will be protected from any detriment imposed on the grounds they have participated ins trike action.

6. School Support Staff Negotiating Body (SSSNB)

A specific body will be created to negotiate on behalf of support staff within schools and academies
The SSSNB will consist of representatives from employers, unions, and an independent chairperson. They will ensure that support staff receive fair pay and access to training and career advancement opportunities. The exact remit and creation of the SSSNB need to be further defined through secondary legislation once this bill is passed.

This will not directly impact on independent schools but may result in a call for a similar body to be created and or recognised representing staff in Independent Schools.

Conclusion

With the Employment Rights Bill introducing potentially far-reaching changes, Independent schools will need to update or overhaul their internal policies and Handbooks
HR staff and school leaders will need to receive training on the new requirements of the Bill to ensure consistent application and compliance with the law.

The Bill will likely have significant consequences for independent schools, requiring careful attention to staff contracts, pay practices, flexible working arrangements, redundancy procedures, and the treatment of zero-hours workers. Schools will need to prepare for these changes by updating their policies, providing training for staff, and possibly increasing their legal and HR support to ensure compliance, however, it is currently difficult to do this as much of the detail is missing and/or subject to consultation.

To book an appointment or to discuss this further, please contact Louise Brenlund at [email protected] at 01732 375325.

This article is for general information only and does not constitute legal or professional advice. Please note the law may have changed since this article was published. We do not accept responsibility or liability for any actions taken based on the information in this article.