New Government, New Employment Laws

As part of a flurry of employment law reforms that will form part of an employment rights bill, Labour plans to introduce a day-one right to protection from unfair dismissal for all workers.

In its Plan to Make Work Pay, published ahead of the election, Labour said it would legislate to ensure employees are given “basic day-one rights”, which also include parental leave, sick pay and flexible working.

It went on to assuage employers’ concerns by stating the change to give employees greater protection from unfair dismissal “will not prevent fair dismissal, which includes dismissal for reasons of capability, conduct or redundancy, or probationary periods with fair and transparent rules and processes”.

The plan further emphasised that the government would ensure employers are able to operate probationary periods to “assess new hires”. However it added: “The changes will help to ensure that newly hired workers are not fired without reason or cause and will help drive up standards in workplaces.”

The significance of these changes should not be underestimated. If Labour proceeds with its plans to implement unfair dismissal rights for all employees from day one of employment, which seems likely, this will unquestionably be the most radical change to unfair dismissal law in over 50 years.

Although the full details of the policy have yet to be published. Notably, both the manifesto and the briefing notes to the King’s Speech state that ‘day one’ unfair dismissal will be a right for ‘all workers’, rather than merely employees, which is currently the case.

So do employers have reason to be concerned about the changes surrounding unfair dismissal? We believe it will become critical that Employers make the right hiring decisions as getting this wrong may result in a lengthy dismissal process to stay on the right side of unfair dismissal law.

Small and micro firms will be at a much higher risk of falling foul of the changes because, typically, they will have very few formal HR practices and less awareness of employment regulation.

Probationary periods and procedures will assume much greater importance, explaining. It seems employers will be expected to bring a new rigour and consistency to the concept of the probationary period to show a fair reason for dismissal from the outset.

Exactly what this will mean should become clear in the autumn. It is likely to involve the active management of clear and consistent probationary policies to assess employee performance throughout any probationary period.

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