Labour and Conservative manifesto pledges on employment law: What do they mean for employers?

At a glance

• Labour 2024 General Election manifesto launched 13 June.
• Conservative manifesto launched 11 June.
• Labour government would deliver its Plan To Make Work Pay, published on 24 May.
• Labour proposals would mean radical change to the employment law landscape.

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The Labour party launched its 2024 General Election manifesto on 13 June; coming two days after launch of the Conservative manifesto, we are now able to assess how the main parties’ respective pledges on workplace rights could affect the employment law landscape.

Labour manifesto

As heavily trailed, there are not many surprises in Labour’s manifesto. The majority of Labour’s pledges on workplace rights are set out in its ‘Plan to make work pay‘ (Plan) published on 24 May 2024. Aside from employers who breach employment law being banned from hiring workers from abroad, a commitment to establish a youth guarantee of access to training, an apprenticeship, or support to find work for all 18- to 21-year-olds, and reform of the Apprenticeship Levy, Labour’s main manifesto pledge on employment law is to implement the Plan in full, introducing legislation within 100 days.

The one employment manifesto pledge which was not highlighted in the Plan is that Labour will introduce a ‘landmark‘ Race Equality Act, to enshrine in law the full right to equal pay for Black, Asian, and other ethnic minority people, strengthen protections against dual discrimination and root out other racial inequalities.

What does the Plan mean for employers?

Billed as ‘the biggest upgrade to rights at work for a generation‘, the Plan sets out some ambitious and potentially transformative proposals across six key policy areas: Ending ‘one-sided flexibility‘; family friendly rights; fair pay; voice at work, equality at work; and rights at work.

The most radical proposal in respect of individual rights is abolishing the qualifying period for unfair dismissal rights. This would be a huge change; although the qualifying period has gone up and down depending on the party in government, it has never been less than six months. If unfair dismissal is genuinely to be made a day one right this will mean significant changes for employers in recruitment practices, use and management of probationary periods and training for managers, as well as a likely significant increase in unfair dismissal claims.

Another proposal which would be transformative but considerably more difficult to deliver is the transition to a two-part framework for employment status under which individuals are classified either as workers (encompassing those who are currently classed as employees) or self-employed. This would extend many workplace rights to a far larger class of workers. However, simplification of employment status has been discussed in detail since the Taylor Review in 2017 and is widely acknowledged to difficult to implement in practice without unintended consequences and a potential deluge of litigation.

Labour will end ‘one sided’ flexibility and ensure all jobs provide a baseline level of security and predictability, banning ‘exploitative‘ zero hours contracts and ensuring everyone has the right to have a contract that reflects the number of hours they regularly work, based on a 12-week reference period. The impact of this policy is potentially substantial but will depend on the detail.

Another headline proposal is the ‘ending’ of so-called fire and rehire. However, the Plan acknowledges that ‘It is important that businesses can restructure to remain viable, preserve their workforce and the company when there is genuinely no alternative‘ which suggests that fire and rehire will still be permissible, albeit in more restricted circumstances.

In respect of family friendly rights, the Plan commits to making flexible working the default from day one for all workers, except where it is not reasonably feasible, and to strengthen protections for pregnant women by making it unlawful to dismiss a woman within six months of her return from maternity leave except in specific circumstances.

A Labour government would also introduce a right to switch off to promote a positive work-life balance, similar to rights recently introduced in Ireland and Belgium.

The Plan also proposes changes to pay gap reporting; large firms will be required to develop, publish and implement action plans to close their gender pay gaps, and outsourced workers will be included in gender pay gap and pay ratio reporting. The publication of ethnicity and disability pay gaps will also become mandatory for employers with more than 250 staff. This will be far more complex than gender pay reporting.

The Plan also makes several proposals to strengthen enforcement of workplace rights. This includes mechanisms to raise collective grievances and a single enforcement body to enforce workers’ rights including strong powers to inspect workplaces. Under a Labour government, the deadline for bringing an employment tribunal claim will be extended to six months.

The Plan also proposes significant changes in collective rights, taking rules on lawful industrial action back to the position pre-2016, making it easier for trade unions to gain statutory recognition and introducing rights for trade unions to access workplaces.

Labour has committed to introducing legislation within 100 days of entering government. However, much of the detail will be contained in regulations and many of the proposals will require extensive consultation to implement in practice.

Conservative manifesto

The Conservative manifesto is notably light on specific employment law pledges, although it states that the UK would ‘retain the flexible and dynamic labour market that gives businesses the confidence to create jobs and invest in their workforce‘. The manifesto also pledged that the Conservative Party would never ‘introduce Labour’s package of French-style union rules‘.

The manifesto contained the following specific pledges of interest to employers:

• Employee National Insurance contributions will decrease by an additional 2p and the main rate of Class 4 self-employed National Insurance contributions would be abolished entirely by the end of the next Parliament.
• A Conservative government would create 100,000 high-quality apprenticeships in England every year by the end of the next Parliament, including flexible frameworks in the film, TV, gaming and music sectors to include work on live productions.
• The Equality Act 2010 would be amended to clarify that the protected characteristic of sex means biological sex. Legislation would also provide that an individual can only have one sex in the eyes of the law throughout the UK.
• The Conservatives would continue implementing the Strikes (Minimum Service Levels) Act 2023 and would bring forward legislation to reapply the entirety of the Trade Union Act 2016 to Wales.
• The fit note process would be overhauled so that people are not signed off sick ‘as a default‘. Under a new system, responsibility for issuing fit notes would be moved away from GPs to specialist work and health professionals. Integration with the new WorkWell service would be tested, to provide tailored support to help people stay in or return to work.
• The National Living Wage would be maintained at 2/3 of median earnings in each year of the next Parliament.