UK: The impact of Parliament's prorogation on pending employment law reforms

Approved

The announcement of a General Election and consequent prorogation of Parliament on 24 May left only two days for the 'wash-up'.  Despite this, a number of employment law reforms managed to complete their progress through Parliament, although it remains uncertain when (and, to an extent, if) they will be brought into force, depending on the outcome of the General Election. (References to the Labour Party position are to that set out in its "Plan to Make Work Pay" policy document published on 24 May 2024.)

• The Paternity Leave (Bereavement) Bill, a private member's bill sponsored by Labour and given cross-party support, has been passed.  This enables regulations to be made to improve leave rights for fathers or partners where a mother, or a person with whom a child is placed or expected to be placed for adoption, dies.  The Act disapplies the usual 26 week minimum service requirement for paternity leave in this situation, with other changes left for regulations.  The Conservative government had confirmed plans to extend paternity leave from the date of the death of the mother/other parent until a year after the child’s birth or placement for adoption, and to make it available whether or not shared parental leave had already been taken.  The proposals also included providing special protection in relation to redundancy after the employee’s return to work; ‘keeping in touch’ days during the period of leave; and in cases where the child also dies, allowing the employee to remain on paternity leave for a period of time after that.  During the most recent parliamentary debate the Conservative government indicated that it aimed to bring the reforms into force in April 2025 and Labour also confirmed it would pass the necessary regulations.  Labour has also promised a review of the regime of parental rights within its first year of government and to ensure family leave rights apply from day one of employment.
• The statutory Code of Practice on Dismissal and Re-engagement (or 'fire and re-hire') was approved and comes into force on 18 July 2024. (See our post here for further details about the Code.) There is no direct claim for breach of the Code, but tribunals must take it into account where relevant and may adjust the compensation for certain tribunal claims by up to 25%, including unfair dismissal awards.  A draft Order extending this power to adjust compensation to cover protective awards for failure to inform and consult on larger scale dismissals (under the Trade Union and Labour Relations (Consolidation) Act 1992) also provides for commencement on 18 July, but has not been formally made at the time of writing.  Labour has stated that it considers the new code inadequate.  If elected, it plans to introduce 'effective remedies against abuse' and a 'strengthened code' which will only allow 'firing and rehiring' when there is genuinely no alternative and after a consultative process.  As yet there is no detail on how this would work.
• In relation to the hospitality sector, the statutory Code of Practice on Fair and Transparent Distribution of Tips was approved by the House of Lords (and had already been approved by the Commons).  Debate in the House of Lords seemed still to envisage that regulations will be made bringing this into force on 1 October 2024 along with the remaining provisions of the Employment (Allocation of Tips) Act 2023.  Labour states that it will strengthen the law to ensure hospitality workers receive their tips in full and workers decide how tips are allocated – although unclear, this may simply be a commitment to bring the 2023 Act into force.
• Regulations were made bringing the remaining provisions (section 6) of the Retained EU Law (Revocation and Reform) Act 2023 into force from 1 October 2024.  Section 6 concerns the role of the courts post-Brexit and establishes a new test to be applied by higher courts when considering whether to depart from assimilated EU or domestic case law, and a new procedure for lower courts or tribunals to refer a point of law concerning assimilated case law to a higher court to decide (as well as for UK law officers to refer a point or to intervene in proceedings).

Still on the cards (in some shape or form)

Other existing planned reforms that are likely to be implemented (although potentially subject to amendment in the event of a Labour win) include:

• the Worker Protection (Amendment of Equality Act 2010) Act 2023, which will come into force from 26 October 2024 (it does not require regulations to be commenced).  This will introduce a new proactive duty on employers to take reasonable steps to prevent sexual harassment (ie, unwanted conduct of a sexual nature) of employees in the course of employment.  The EHRC recently indicated that it intends to consult on revised technical guidance on the new duty for six weeks from 'early summer' and to publish the final guidance in September 2024, at least a month before the new duty comes into force.  Earlier drafts of the Act included provisions imposing liability for third party harassment and for the new duty to require all reasonable steps.  These were removed following opposition in the House of Lords but the Labour Party plans to reinstate them if elected.  Angela Rayner has also stated that protection against sexual harassment will be extended to interns and volunteers.
• the Conservative Government recently announced that it would introduce legislation to clarify that non-disclosure agreements (NDAs) cannot be legally enforced if they prevent victims from reporting a crime to law enforcement or a regulator or for the purposes of obtaining legal or professional advice or other victim support.  This was contained in the Victims and Prisoners Act 2024 passed during the wash-up period, but requires regulations to be brought into force. Labour says that it will update whistleblower protection for women who report sexual harassment at work;  it is unclear whether this might go as far as banning the use of NDAs in harassment cases.
• the Government aimed to bring the Workers (Predictable Terms and Conditions) Act 2023 into force in September 2024 – regulations are required to do so and we are also still waiting for the final accompanying statutory code (see our post here for more details).  The Act provides for a statutory right to request a predictable work pattern, with the employer being able to refuse for specified business reasons.  The Labour Party proposes a stronger right to have a contract reflecting hours regularly worked (over a 12 week reference period).  It has also committed to ensuring workers have the right to reasonable notice of changes in shifts and compensation for shifts cancelled or curtailed (proposals which the Conservative government consulted on in 2019, but never confirmed).  Labour may therefore choose to put forward an alternative bill, or amend the 2023 Act before bringing it into force.
• the Government also had plans to create a single enforcement body but progress had seemingly stalled.  The Labour Party has committed to deliver such a body with trade union and TUC representation, to include 'strong powers' to inspect workplaces and bring civil proceedings to uphold employment rights.
• the Neonatal Care (Leave and Pay) Act, which requires regulations to be brought into force, will provide a ‘day one’ right to neonatal care leave for employees whose baby spends at least 7 continuous days in neonatal care starting within 28 days of birth (see here for more detail).  The expected timetable under the Conservative Government was 'not before April 2025', given the number of sets of regulations required.  Labour has not commented on a possible timetable.
• possible proposals for reforms to whistleblowing laws were expected following a call for evidence ending in December 2023.  Labour has said only that it 'will strengthen protection for whistleblowers'; it may well look to match the requirements of the EU Whistleblowing Directive.

Going nowhere? 

Other proposed reforms could now fall by the wayside, depending on the result of the General Election:

• the Data Protection and Digital Information Bill (which would have made a number of changes including to rules on subject access requests) has now failed.
• no progress was made on the Conservative Party's plan to place a 3 month statutory cap on the duration of non-compete restrictive covenants in employment contracts.  Restrictive covenants are not mentioned in the Labour Party's latest policy document. 
• a response was pending on the Government's plans to introduce fees for employment tribunal claims and EAT appeals.  Labour has committed to improving the tribunal system and extending the time limit for all tribunal claims to six months; no express reference is made as to funding.  It may perhaps be hoping that costs will be kept down by planned further digitisation of the tribunals and by a potential reduction in claims which it considers could be the result of employers having higher quality guidance on their legal obligations and a longer period to resolve matters internally before a claim must be lodged.
• the Government was planning to reform the fit note process, with a call for evidence closing on 8 July.  The Labour Party has stated that it will strengthen statutory sick pay, removing the lower earnings limit and the waiting period.
• the Government launched a consultation on further changes to TUPE on 16 May, closing on 11 July 2024.  This proposed clarifying that TUPE does not apply to limb (b) workers and providing that an employment contract cannot be split between multiple transferees (reversing European caselaw).  The consultation also proposed abolishing the legal framework governing the remaining UK-based European Works Councils.  Labour seems unlikely to support these ideas – it has said it will strengthen the existing rights for workers subject to TUPE.  (Note this proposal is further to the reform already in force, applying to transfers on or after 1 July 2024, which will allow employers with no appropriate employee representatives in place to inform and consult affected employees directly where (i) they employ fewer than 50 employees in total, or (ii) there are, or are likely to be, fewer than 10 transferring employees (whatever size the employer is).)
• on 17 May it was confirmed that the Government's pay transparency pilot scheme (requiring participating employers to include information about salary in job adverts and to not ask candidates about their salary history) has been paused, with the intention of waiting to review the experience of other countries currently exploring legislative options (possibly referring to similar obligations in the EU Pay Transparency Directive).  Pay transparency is not mentioned in the Labour Party policy document, although it does commit to tackling the gender pay gap more quickly and may well want to keep pace with EU reforms.
• the Conservative Government consulted on setting minimum service levels during strike action for the education and urgent/emergency hospital services sectors, and on enabling employment businesses to supply agency workers to cover strikes.  Obviously, the Labour party's proposals in this area are very different and aimed at repealing recent union legislation and significantly strengthening trade union rights.

We will be looking at the proposals in Labour's Plan to Make Work Pay in more detail in a future post. [Update: see here.]