The political parties’ manifestos for the General Election on 12 December 2019 have been published.
These are received against the backdrop of major employment rights changes planned to be effective from 6 April 2020. Once the election result is known we will comment on the effect the result has on changes already in the pipeline for Spring 2020.
Our comments are confined to matters raised in the manifesto and do not cover any other announcements made by the parties.
What are the three main parties’ priorities for work and employment rights?
Labour have ambitious plans to transform employment rights in the workplace so that all workers have equal rights despite their employment status. They have radical proposals to reduce working time and pay inequality. However, there is no detail around how this will work in practice.
Their main proposals include:
Equal rights for all workers
All workers to have full employment rights from day one including unfair dismissal rights, currently only available to employees with two years’ continuous employment.
All workers will have the right to request flexible working, currently only available to employees with 26 weeks’ continuous employment.
Larger companies to be compelled to hand over 10 per cent ownership of their business to employees (to include payments and dividends).
Self-employed contractors will qualify for childcare vouchers.
Family friendly rights
Extend statutory maternity pay from nine to 12 months and double paid paternity leave to four weeks as well as increase the statutory rate of paternity pay.
Statutory bereavement leave will be introduced to guarantee workers time off to grieve the loss of close family members or following a miscarriage. However, no time period is specified.
Working time and holiday
Within a decade, introduce a four-day week with no reduction in pay to tackle excessive working hours. They believe it will pay for itself with the increase in productivity.
End the right to opt-out of a maximum 48-hour week.
Set up an independent Working Time Commission to advise on reducing the maximum working week, raise minimum holiday entitlements and necessary enforcement measures.
Introduce four new bank holidays to celebrate the four patron saints’ days.
Real Living Wage
A Real Living Wage of at least £10 per hour for all workers aged 16 and over from 1 April 2020. This will be funded using savings to public finances to help small businesses manage the extra cost.
Unpaid internships will be banned.
Stronger trade unions
Trade unions to be given more power to enforce rights at work by giving them increased rights of entry to workplaces to organise, meet and represent their members. They will also introduce a new, unified Workers’ Protection Agency to enforce workplace rights, including the Real Living Wage. It will be given extensive powers to inspect workplaces, prosecute and to pursue civil proceedings on workers’ behalf.
Pay gap reporting
Close the gender pay gap by 2030 by making the state responsible for enforcing equal pay legislation.
The new Workers Protection Agency will work with HMRC to ensure that employers take equal pay seriously and there is ‘positive action’ (presumably not intended to be positive discrimination action) to close the gender pay gap. This will include requiring all employers with over 250 employees to obtain government certification on gender equality or face further auditing and fines.
The employee threshold will be reduced to 50 by the end of 2020 and they intend to extend pay-gap reporting to BAME groups and to employees with disabilities.
The policies for the Liberal Democrats focus heavily on modernising employment rights for workers in the gig economy. Notably they have not committed to increasing the National Living Wage but will review the living wage and increase flexible working rights.
Modernise employment rights in the growing gig economy
Establish a new ‘dependent contractor’ status between employment and self-employment - with rights to national minimum wage, sick pay and holiday.
Review tax and national insurance status of employees, dependent contractors and freelancers to ensure fair and comparable treatment.
Increase minimum wage for workers on zero-hour contracts by 20 per cent at times of increased demand to compensate for the uncertainty of fluctuating hours of work.
Introduce the right to request a fixed contract after 12 months for zero hour and agency workers.
Review pension rules so that those in gig economy don’t lose out.
Shift the burden of proof in employment tribunals regarding employment status from individual to employer.
Strengthen ability of unions to represent workers effectively in the modern economy, including a right of access to workplace.
Establish a new Worker Protection Enforcement Agency to protect gig economy workers with insecure jobs.
No commitment to increasing the National Living Wage but will establish an independent review to consult on how to set a genuine living wage.
Extend flexible working to all workers from the first day of employment – with a requirement for employers to advertise jobs accordingly (unless there are significant business reasons this is not possible).
The Conservatives, unlike the other parties, have less to say about the future of employment law. Whilst the government had reassured us that it plans to preserve workers’ rights under EU law, this is likely due to Brexit and the terms of any agreement which would determine the future of EU rights.
Nevertheless, the Conservatives have already committed to improving workers’ rights as recommended by the Taylor Review and changes are due to be implemented in April 2020. They include giving all workers the right to a contract on day one of their employment to include minimum employment terms. The reference period for calculating average weekly pay will change from 12 to 52 weeks, to ensure that workers are not disadvantaged when they take holiday during quieter periods.
Further changes due in April 2020 include the reform of IR35 rules which intend to create tighter controls over the tax status of so-called ‘self-employed’ contractors.
Longer-term proposals for the Conservatives recorded in their manifesto include:
National Living Wage
Increase the National Living Wage to £10.50 to ‘everyone over 21’ by 2024. Whilst not specifically stated in the manifesto we assume that it will include those aged 21, in line with current legislation.
National Skills Funds
Create a new National Skills Fund worth £3bn reserved for investment in skills, to help transform the lives of those who lack qualifications to get onto the career ladder as well as those who return to work from a career break raising a family.
Measures to protect low paid workers and the gig economy
Create an ‘enforcement body’ to crack down on any employer abusing employment law, whether by taking workers’ tips or refusing to pay them sick pay.
Ensure that workers have the right to request a more predictable contract.
Flexible working and family friendly rights
Encourage flexible working as the default unless employers have a good reason not to.
Allow parents to take extended leave for neonatal care, to support new mothers and fathers during the most vulnerable and stressful days of their lives.
Reform redundancy law so that pregnant women and new parents have increased protection.
Extend the entitlement to leave to unpaid carers.
Fund ‘more high-quality childcare’ before and after school and during holidays to help working parents.
Whilst the priorities of the parties vary, there does appear to be overlap in their policies particularly regarding flexible working and the protection of workers’ - especially those in the gig economy. The parties also agree that wages need to increase for the most vulnerable workers.
Following the election result we will keep you informed on the employment law changes to expect in 2020.
In the meantime, if you would like further information on the parties’ manifestos or to discuss any of the proposals, please speak to Jennifer Mansoor.