Employment Rights Bill could hinder hiring

The government has revealed its Employment Rights Bill and while promising to put a stop to unfair employment practices, it has been met with some concerns.

Replacing ‘out of date employment laws’, the Bill will ban exploitative zero-hours contracts, end ‘fire and rehire’ and ensure certain rights that will start from the worker’s first day in a new job, such as paternity and parental leave, protection from unfair dismissal and a right to bereavement leave.

Commenting on the Employment Rights Bill announcement and expressing the concerns surrounding it, Tania Bowers, Global Public Policy director at the Association of Professional Staffing Companies (APSCo), said, “As we expected, the Bill leaves areas yet to be fully fleshed out. Following our conversations with policy decision makers over the past months there are no surprises and we recognise that Government has sought to address the concerns of business particularly over the need for a probation period and we welcome the opportunity to consult.  However, the complexities of the modern workforce make it impossible to create rules and regulations with a one-size-fits-all approach.

“APSCo will be involved in the consultations in the coming months, but from our initial review of the proposals there are a number of areas we are keen to ensure are addressed. Primarily, the introduction of day one rights has the potential to hinder hiring. Risk-averse employers may look at methods of pushing the risks onto others in the supply chain, such as staffing companies, which places these businesses in a difficult position.

“We were expecting the right to guaranteed hours and a cancellation fee on zero hours in the Bill and we are pleased to note that there is going to be consultation as to how agency workers are incorporated into this legislation. It is clear that the Government has recognised the complexity of this, but the intention remains to fit agency workers into these zero hours changes. This does create some concern, particularly around who should be responsible for this, employers or recruiters.”

Tania added, “It’s important that over-legislation doesn’t disadvantage those who choose maximum flexibility in their working patterns or those that don’t want or need protection such as highly skilled contractors. Our members know that there may not be a pattern of work, or critically the ability to foresee labour demand, in key sectors such as education and healthcare, meaning establishing a guaranteed hours contract based on regular hours will be challenging.

“The recruitment and hiring outsourcing sectors are built and thrive on a flexible labour market where individuals have the confidence and ability to steer their own career paths. We support the Bill’s intention to support people into work and drive growth with a “pro-business, pro-worker” approach but the unique diversity of the UK labour market with the value delivered by professional contracting must be retained and encouraged.  The intention to move to a single status of worker, for example, is a highly complex challenge to address.

“Of course, the devil will be in the detail that we expect to be published over the period between the 2026 roll out of the Bill. As the Starmer Administration looks to improve the fortunes of the UK economy, we would advise that they pull on the knowledge and experience of those embedded in the staffing sector to ensure the Bill delivers value for all. We are encouraged by the Next Steps document outlining reforms to be implemented in the future following consultations with relevant industry representatives. This suggests that the Government is taking an informed and robust approach to what will be a significant overhaul of employment legislation.”

To find out more about contracting please contact Sophie on 01206 591 000 or email sophie.lewis@contractoumbrella.com.