Government’s Employment Rights Bill will mark ‘radical change’ in law

The government’s Employment Rights Bill, currently completing its passage through Parliament, will mark “a radical change” in the law and lead to “an awful lot of due diligence” on recruitment.

That is according to employment lawyer Rebecca Thornley-Gibson, partner at DMH Stallard, who described the decision to grant “day one unfair dismissal rights” to employees as a “headline grabbing” measure that would end probation periods for new staff.

A new ‘initial period of employment’, which includes some unfair dismissal rights, will replace probation when the Bill becomes law. Unfair dismissal rights currently only apply after two years’ employment.

More: Leading lawyer warns of ‘fundamental’ changes to employment law

Comment: Unfair dismissal from day one will become law – but not just yet

Thornley-Gibson told an Abta Travel Law Seminar in London that the new law “will create an awful lot of additional due diligence on recruitment because you have legal claims risks from day one. It will mean a lot more management training to be aware of the process.”

She noted: “The initial period of employment will allow a modified dismissal procedure. But we don’t know what the period will be – probably nine months – and dismissal during this period will have to follow a modified process.”

The Bill will create a Fair Work Agency to provide legal assistance to employees and bring claims against employers in some areas, including on holiday and sick pay and the national minimum wage, and Thornley-Gibson warned: “We’ll probably see an increase in litigation. The agency will take two to three years to set up, so there is time to get your house in order, but it will not be a blunt instrument.”

She added: “There are new proposals on record-keeping on holiday leave and holiday pay, and a failure to keep adequate records will be an offence with unlimited fines.”

The Bill will also require businesses employing staff on zero-hour or low-hour contracts “to make an offer of guaranteed hours after every ‘reference period’”, she noted. “But we don’t know what will qualify as ‘low hours’ or what a reference period will be. We think 12 weeks.”

Thornley-Gibson suggested: “If this goes in as proposed, employers probably won’t want to touch zero‑hour contracts.”

She noted the legislation is “likely to be implemented by the end of 2026” and said: “We advise businesses to wait until this is clearer before changing employment policies.”