Workers get new rights on contracts, flexibility, sick pay and holidays

The Employment Rights Bill includes 28 new protections and reforms for workers

The government said its Employment Rights Bill is being unveiled against a backdrop of it inheriting a “battered” economy from the Conservatives, who ministers accused of presiding over “strike Britain”. More than twice as many days were lost to industrial action than France under Rishi Sunak’s premiership, said Labour, following more than two years of strikes by hundreds of thousands of workers including nurses, teachers, junior doctors, train drivers and barristers.

The existing two-year qualifying period for protections from unfair dismissal will be removed. The government will also consult on a new statutory probation period for companies’ new hires. This will allow for a proper assessment of an employee’s suitability to a role as well as reassuring employees that they have rights from day one.

The bill will bring forward 28 individual employment reforms, from ending exploitative zero hours contracts and fire and rehire practices to establishing day one rights for paternity, parental and bereavement leave for millions of workers. Statutory sick pay will also be strengthened, removing the lower earnings limit for all workers and cutting out the waiting period before sick pay kicks in.

Accompanying this will be measures to help make the workplace more compatible with people’s lives, with flexible working made the default where practical. Large employers will also be required to create action plans on addressing gender pay gaps and supporting employees through the menopause, and protections against dismissal will be strengthened for pregnant women and new mothers. This is all with the intention of keeping people in work for longer, reducing recruitment costs for employers by increasing staff retention and helping the economy grow.

A new Fair Work Agency bringing together existing enforcement bodies will also be established to enforce rights such as holiday pay and support employers looking for guidance on how to comply with the law.

Deputy Prime Minister Angela Rayner said: "This government is delivering the biggest upgrade to rights at work for a generation, boosting pay and productivity with employment laws fit for a modern economy. We’re turning the page on an economy riven with insecurity, ravaged by dire productivity and blighted by low pay.

"The UK’s out-of-date employment laws are holding our country back and failing business and workers alike. Our plans to make work pay will deliver security in work as the foundation for boosting productivity and growing our economy to make working people better off and realise our potential.

"Too many people are drawn into a race to the bottom, denied the security they need to raise a family while businesses are unable to retain the workers they need to grow. We’re raising the floor on rights at work to deliver a stronger, fairer and brighter future of work for Britain."

Labour said new analysis showed that the Tories’ “scorched-earth” approach to strikes over the last two years cost the economy £3.3 billion in lost productivity, including £1.7 billion from NHS industrial action alone. If the trend continued for another term of Conservative government, the UK would have been projected to lose 13.5 million working days, costing the economy just under £5 billion in lost productivity, said Labour.

Under Rishi Sunak’s premiership the UK lost on average just under three million working days a year to industrial action, twice as many a year as France, said Labour.

Overall since May 2010 the UK lost 9,873,000 days to strike action, while from 2016 to 2022, the number of hours lost to strikes increased more than sevenfold, with the number of stoppages in 2022 hitting a 30-year high.

In 2022, the UK had 65 times more days lost to strike than Sweden, 11 times more than Germany and twice as many as Spain, the government added.

Soon after winning the general election in July, the government resolved long-running disputes involving junior doctors and train drivers.

The government added that industrial action during the 14 years of the Conservatives cost the UK economy £3,307,455,000 in lost output and £1,207,221,075 in lost taxes for HMRC.