Employment Rights Bill: Second reading, consultation and impact assessments

The Bill had its second reading in the House of Commons on 21 October (see our earlier blog here for a summary of what it contains). The second reading was accompanied by a flurry of related documents. As a result, we now know more about the Government’s plans. 

Bill timetable

The Bill now proceeds to its committee stage where it will be scrutinised line by line. The Bill Committee is due to report to the House of Commons by 21 January 2025.

Though the exact timetable has not been set, we would expect the Bill to have completed the parliamentary process by the summer recess, which is likely to start in late July 2025.

Consultations

Four separate consultations were published on 21 October:

• Fire and re-hire/collective redundancies: this consultation explores proposals to extend the availability of interim relief, lift or remove the cap on the protective award and increase the minimum consultation period for the largest scale redundancies.
• Zero hours contracts and agency workers: the Government is consulting on how best to extend the protections in the Bill for workers on zero hours contracts to agency workers.
• Industrial relations framework: this complex paper explores a range of options to add to the measures already in the Bill. Key areas include industrial action ballots, compulsory union recognition and trade union access to the workplace.
• Statutory sick pay: this consultation explores the options for calculating the appropriate reduced rate for low earners.

These consultations close on 2 December, which the exception of the SSP consultation, which closes on 4 December.

It seems likely that the results of these consultations will feed through to amendments to the Bill as it continues to progress through Parliament. 

Impact assessments

23 different impact assessments were also published on 21 October. Each of them subjects a key measure in the Bill to a separate cost benefit analysis.

It is however the 24th document in the suite, the economic analysis and summary impact assessment, which has attracted the most attention, because it looks at the impact of the Bill as a whole. That’s the source of the figure that the monetised direct cost to businesses of all the planned measures could be as high as £4.5 billion, though that would represent less than 0.5% of total payroll costs in the UK in 2023. 

The Government calculates that the direct benefit to workers will be of a corresponding order. However, it believes there will be “significant wider benefits to society, including positive impacts on health and wellbeing, equality, competition, participation.”