The Labour Party has said that their manifesto for Government will be published and available before the election on July 4. In the meantime, we have taken a look at the party’s “Plan to Make Work Pay”, which is a reasonably detailed document outlining Labour’s strategies for economic growth and proposals that will affect workers and employees.
Among the proposals outlined in the document, the ones that grabbed our attention the most are: the abolition of the two-year qualifying period for employment rights, making flexible working a day-one right, and paying statutory sick pay (SSP) from day one of absence. We’ll explore the potential impact of each of these proposals in more details below and their potential impact on UK businesses.
Abolition of the Two-Year Qualifying Period for Employment Rights: Despite best intentions and a desire to maintain best practice whilst employing individuals, we rely quite significantly on the two-year rule when advising clients regarding dismissals. Currently, employees need to have worked for two years before they can claim unfair dismissal. Whilst we would never recommend an inappropriate dismissal, the two-year rule does provide something of a safety net against tribunal claims.
The Labour Party’s plan to abolish this qualifying period will extend immediate protection to all employees from day one. While this change is designed to enhance workers' rights, it poses significant challenges for employers. Potentially, the removal of the two-year qualifying period will mean every dismissed employee would be eligible to make a claim for unfair dismissal, potentially leading to more employment tribunals. This will necessitate more rigorous documentation and justification of employment decisions to defend against potential claims.
Businesses would need to sharpen up their HR practices an particularly during probation periods, probably making six months of probation the default as this might be the only opportunity to dismiss an underperformer. There would be no room to forgo regular meetings on a weekly, bi-weekly or monthly basis for workers on probation. Managers would need to be confident in setting strict goals and objectives and of measuring the new recruits performance against these. A structured plan for benchmarking achievement milestones to measure progress would also be a good idea.
Flexible Working as a Day-One Right: Labour’s proposal to make flexible working a right from the first day of employment reflects changing workplace dynamics and a push for greater work-life balance. Current legislation extends as far as workers being allowed to apply for flexible working from day one, which is already seen as controversial. Labour’s proposal however, could create recruitment challenges, particularly for roles that require full-time, on-site presence.
We fear that workers will be able to apply for, and be offered a full-time role, only to be able to demand a flexible working pattern from day one. Employers may then find it harder to ensure consistent team collaboration and maintain productivity levels, especially in industries where physical presence is critical. This in turn may affect the ability to meet customer demand.
There may be a need for businesses to rethink their approach to job design and employee engagement. Offering hybrid models that balance flexibility with necessary office time could be a solution, but it requires a cultural shift and investment in technology to support remote work effectively. Job roles may need to be made more flexible from the outset and interviews could become more of a negotiation exercise to determine days and hours worked and from which location.
In addition, for smaller employers who are less profitable, the provision of extra equipment and technology for multiple employees may be prohibitive.
Statutory Sick Pay (SSP) from Day One of absence: Labour’s plan to make SSP payable from the first day of absence aims to provide immediate financial support to employees who fall ill. Currently, SSP is only payable after three consecutive days of absence, easing the financial burden on employers for short-term sickness.
Introducing SSP from day one means employers would bear the cost of sick pay for even a single day’s absence. Remember, UK employers cannot reclaim SSP from the government, which could lead to increased financial strain, particularly for small businesses with tight margins. It’s a great attention grabber for voters and one that comes at zero cost to the Government because they’re not footing the bill.
There is also a concern that this policy might encourage higher absenteeism rates, with employees more likely to take short-term sick leave knowing they are financially covered from the outset. Employers would need to implement more stringent sickness monitoring and support systems to manage absenteeism effectively whilst maintaining an adherence to disability discrimination laws and being cautious of not harassing truly ill employees.
With the knowledge that some pay will come, even if it is just SSP, the temptation to “throw a sicky” after a night out or sleeping through the alarm may prove very tempting for some.
Furthermore, those businesses and organisations that offer periods of full pay for sickness absence may find further financial burden through paying for more sick days as there will be less incentive for workers to attend work. Enhanced sick pay schemes would not be able to be simply revoked. A period of consultation would be required, and the benefit is so significant, to remove it would probably need to be bought out. Affected organisations would also include many already cash-strapped councils and the NHS.
Labour’s plan to beat immigration by training UK nationals to do the jobs for which we currently employ foreign nationals deserves some applause. This is likely to be through more specific training and apprenticeships in what are considered key subjects such as the STEM topics of Science, Technology, Engineering and Maths. We hope some provision will be made for managers and leaders.
Unpaid internships are also facing the chop under Labour. Designed to give graduates the opportunity of work experience, employers also benefit from the fresh ideas and energy that interns bring. Labour will insist that interns are remunerated for their time in post, we suspect at least at the National Minimum Wage, which we think is only fair.
In all, the Labour Party’s Work Plan, which we expect to partly form their manifesto, whilst aimed at enhancing worker rights and well-being, presents several challenges for UK employers. A copy of the plan is downloadable at https://labour.org.uk/updates/stories/a-new-deal-for-working-people/
Employers will need to be ready to proactively adapt their HR practices, invest in effective management and support systems, and explore innovative ways to attract and retain talent. While these changes are aimed at creating a fairer and more supportive work environment, they necessitate careful planning and strategic adjustments from businesses to mitigate potential negative impacts.
If you want to get ahead of the curve with your policies and practices we’re here to help. Call us on 01452 331331 or email This email address is being protected from spambots. You need JavaScript enabled to view it.
