The UK job market is on the brink of a pretty important transformation. With the new Labour government in power, employers, HR professionals, and recruiters need to get ready for some big changes coming their way. These changes stem from Labour’s ambitious plan to overhaul Employment Law under their “Plan to Make Work Pay.”
A new dawn for employment law
On 24 May, Labour published its “Plan to Make Work Pay – A New Deal for Working People,” outlining a game plan for revamping workers’ rights. These changes will come quickly, with Labour promising to introduce an Employment Bill within their first 100 days of government. While they’ve promised full consultations, many of these reforms are extensions of the 2017 Taylor Review, showing that Labour is ready to take decisive action.
Key proposals and their impact on recruitment
1. Single Enforcement Body (Fair Work Agency)
Labour plans to introduce a Single Enforcement Body, expected to be named the Fair Work Agency. This agency will combine the functions of a few of the existing enforcement bodies to make sure workers get “faster access to justice”. It will include trade union representatives and have strong powers to inspect workplaces and enforce employment rights, such as working time or flexible working.
Impact: Employers will need to make sure they’re following all employment laws to avoid inspections and potential penalties. Recruitment practices will need to be transparent and fair from the outset.
2. Unfair dismissal rights from day one
Currently, employees must work for two years before gaining unfair dismissal rights. Labour plans to change this, granting unfair dismissal rights from day one of employment. While employers can still make use of probationary periods, these must follow fair and transparent rules.
Impact: This shift will require a more thorough hiring process and a more structured and robust probation process. Employers should make sure to address conduct and capability issues right from the start to avoid any legal headaches later.
3. Ban on exploitative zero-hours contracts
Labour aims to end “one-sided flexibility” by banning “exploitative” zero-hours contracts. Workers will have the right to contracts reflecting their regular hours, based on a 12-week reference period. Plus, workers will be entitled to reasonable notice of any shift changes and compensation if their shift gets cancelled.
Impact: Employers intending to recruit on a zero hour contract basis should consider if this will be a genuinely accurate reflection of the anticipated arrangement, and adapt to offer more predictable and secure employment terms if necessary. This may lead to changes in recruitment strategies and workforce planning, especially where flexibility is a core part of a business’ operating model – in industries such as hospitality and social care.
4. Establishing a genuine living wage
The new government is planning some big changes for the National Minimum Wage (NMW). First up, they’re going to update the Low Pay Commission’s guidelines to consider the cost of living along with median wages and the overall economy. Next, they’ll get rid of the current age bands for the NMW, which they believe are unfair. They also plan to have the Single Enforcement Body and HMRC make sure that NMW rules about travel times for workers who move between sites are followed and that contracts are up to date with the law.
Impact: Higher wages make positions more attractive, potentially leading to a larger pool of applicants, but it may also increase overall recruitment costs.
5. Single status of worker
Labour wants to make employment status simpler by ending the differing rights and status between employees and workers, to create just one worker status, and only distinguishing between workers and those who are truly self-employed.
Impact: Clear definitions will help recruiters classify workers accurately, making sure everyone gets the correct rights and protections and potentially speeding up and simplifying the recruitment process. However, there could be some cost implications for HR departments if some job roles need to be reclassified.
Challenges for employers and recruiters
- Managing compliance – With stricter enforcement and new rights, recruitment practices must carefully follow the new laws.
- Adapting to new contract types – Employers will need to rethink their use of zero-hours contracts and make sure all employment terms are fair and predictable, as well as bearing in mind the new combined worker status and any enhanced rights potentially arising from it.
- More paperwork and admin – Keeping better records and following stricter procedures will help business owners stay on the right side of these changes from the very start.
How pre-employment checks can help you get prepared
Labour’s proposed changes to Employment Law are going to have a big impact on UK recruitment, and they’ll require following the new rules extremely closely. Doing accurate pre-employment checks is crucial for meeting these legal requirements and avoiding any fines or legal troubles.
Thorough checks not only help you comply with the law but also ensure you hire the best candidates by verifying their qualifications, experience, and right to work in the UK. This leads to a more competent and reliable workforce.
By doing proper checks, you can streamline your hiring process, cut down on administrative hassles, and speed up onboarding.
If you need a helping hand with your employment checks, such as DBS Checks, Right to Work Checks, or Identity Checks, uCheck is here to help. We make background checks simple for more than 30,000 businesses, and we can help you get your pre-employment checks sorted quickly and your recruitment process that much smoother.
To find out how we can help, contact us today at info@ucheck.co.uk or call us on 0300 140 0022.
