Gov Announces Employment Rights Bill Amendments

A number of amendments to the Employment Rights Bill are to be considered at the report stage in the House of Commons. Four consultations were launched in October 2024 in relation to:

• Strengthening statutory sick pay;
• Collective redundancy and fire and rehire;
• Creating a modern framework for industrial relations; and
• The application of zero hours contracts measures to agency workers.

The Government has now published its response to these consultations, as well as a response to a consultation undertaken by the previous Government about tackling non-compliance in the umbrella company market. A summary of the response is outlined below.

Strengthening Statutory Sick Pay (SSP)

Currently, employees who earn below the Lower Earnings Limit (LEL) are not eligible to receive SSP. The LEL is £123 per week, increasing to £125 per week in April 2025. The Bill proposes to remove this eligibility requirement and allow low earners to receive 80% of their average weekly earnings, or the current SSP rate, whichever is lower.

Collective Redundancy and Fire and Rehire

Where an employer has failed to adhere to collective redundancy requirements, affected employees can bring a claim for a protective award. The Bill proposes to double the maximum period of this award from 90 days to 180 days.

The Government has confirmed that it will not make interim relief available to employees who bring claims for protective awards or for unfair dismissal related to ‘fire and rehire.’

Creating a Modern Framework for Industrial Relations

The Bill proposes several amendments to the legislative framework governing trade unions and industrial relations, including:

• Streamlining the recognition process and strengthening protections against unfair practices;
• Allowing digital access for collective bargaining purposes;
• Abolishing the 10-year requirement for unions to ballot members on a political fund;
• Simplifying the information requirements for ballots and notices; and
• Extending the expiry of a mandate for industrial action from 6 to 12 months.

Applying Zero Hours Contract Measures to Agency Workers

The Bill proposes a right to guaranteed hours reflective of the hours worked during a reference period (anticipated to be 12 weeks). It suggests that this obligation will lie with the end user of the worker’s services, while retaining flexibility to place it on agencies or other entities in certain scenarios.

Both the end user and the agency will be responsible for issuing reasonable notice of shifts, shift cancellations, and changes to shifts. The agency will bear responsibility for any short-notice cancellation or curtailment payments, though agencies may negotiate terms to recoup such costs from the hirer when appropriate.

Tackling Non-Compliance in the Umbrella Company Market

Although no action was taken on the previous Government’s consultation, the current Government has responded and the Bill proposes to regulate umbrella companies for employment rights purposes.